As a property investor looking for the right property manager in Newcastle, you are flooded with options. Knowing how to find the right property manager amongst the sea of corporate real estate agencies, semi-online services and genuine property management specialists is difficult.
Much of the challenge comes from the fact that most property management businesses tell you the same things. Do these points sound familiar?
- "We look after your property as if it was our own"
- "We'll always call you back"
- "We look after landlords and tenants alike"
Unfortunately, claims such as these can be difficult to substantiate. You only experience how well a company manages your investment, how attentive they are to your needs and the needs of your tenants ongoing after you have chosen them as your managing agent.
Additionally, we believe that claims such as these are simply committing to the basics. Claims such as "we always call you back" and "we look after your property as if it was our own" are not unique selling points for a property management business. They are simply the way business should be getting done.
A property investor needs to experience the service of an agency directly before they can determine whether these comments are true representations of how the property management company does business, or just nice marketing statements.
Research Shows Most Real Estate Agents Are Terrible At Property Management
By way of background, it is important to consider that real estate agencies are notoriously poor at providing property management services to landlords. The consistent high turnover of property management staff, lack of motivation and lack of experience of property managers in Australia is not just anecdotal, it is backed by research.
Just some of the findings from Rockend and Elite Agent's 2018 Voice of Australian Property Management Report, a nationwide survey of 1,034 property management professionals, revealed:
As the report concludes, "When employees are disillusioned and unhappy it impacts training costs, onboarding and loss of business knowledge resulting in a poorer service to owners and tenants as teams constantly struggle to be on top of their workloads".
Of course, this suggests that there is a low likelihood of finding a quality, long-term professional property manager to look after your investment when you speak with your local agency.
So, what can you do in your research prior to selecting an agent to manage your property?
6 Steps to Find The Best Property Management Company In Newcastle
1. Consider businesses solely focused on property management
Rental property management is often an "add on" to a broader agency offering. The sales team is often given "rock star" status and their achievements heralded across company websites and social media.
When researching options, consider publicly and behind the scenes how much attention is given to property management. Are there enthusiastic, knowledgeable and experienced staff dedicated to property management and available to speak with you any time you call?
Even businesses which once defined themselves as "property management only" have expanded to offer services such as buyers agency services and investment advice. These are not bad things of course, however they can dilute the focus of the business. Focus is valuable.
2. See how dedicated each business is to education and advice
Once you've shortlisted a number of businesses focusing on property management in Newcastle, consider their approach as a business to offering education and advice.
Do these agencies freely offer information to help guide and inform investors? Some agencies claim to offer advice and helpful resources for landlords, however put this information behind a wall, requiring contact details and an email address before allowing access.
We recommend choosing an agency which freely and publicly offers information to help investors in the region. If expert knowledge is given away freely, imagine the level of service provided to those who choose to engage the agency.
3. Call each property management company
Next, call each of the property management businesses you still have on your list. In making this contact, pay attention to the following:
a) Do you have a direct line to a property management expert, or simply a reception number? If you need to leave a message and wait for a call back, do not wait for any more than 24 hours at the very most. If you as an investor - the lifeblood of their business - are unable to rouse enough interest from a company to have your call returned the same day, what low level of attentiveness will you expect once you are "converted" to a client on their books?
b) How responsive are they to the call? Are they eager to talk about your investment and your goals, or are they simply fielding a call quickly before getting back to other matters?
c) Is the person you speak with the person you will build a long-term relationship with? Or is this a business development manager who will "sell you in" to the business before passing you to other team member/s once your business is secured?
d) Does the person appear to be enjoying their job? Often, an individual will start in an agency on reception or in a junior property management role with a view to progressing to the sales department once they are more experienced. If this has not happened as expected, job satisfaction and client satisfaction can plummet.
e) After making several calls, who do you feel most comfortable with? Who seems the most professional, the most responsive, the most interested, the most genuine? These are all traits required in a quality property manager.
4. Ask how long the property manager has been working in the industry
Currently, it is possible for a junior to complete their Certificate of Registration online within a week or two and be managing your investment property soon after. You only need to take a look at the Team pages on real estate agency websites to see that property management departments tend to have a very young age skew.
Age isn't strictly the problem. Limited experience is. Many property management officers in landlord and tenant facing roles are simply ill-equipped. Many younger staff would have no experience in home or investment property purchase, and would have limited connection to the real-life needs of investors and tenants.
A property manager needs to be able to add value to a conversation with a landlord around trends in rental return or adequate insurance, while at the same time being able to appropriately manage tenant issues such as relationship breakdown or sudden unemployment.
Experience counts. Simple.
5. Consider what the business offers you as an investor
Next, research how each business operates. Beyond the basic claims made in most marketing materials, find out what you can enjoy as an investor should you choose their particular business.
What we do for our landlords is clearly detailed on our website and we are only a phone call, SMS or email away for any questions investors may have.
6. Don't make a decision based on fees
We encourage investors not to make a decision on their choice of property management company based on fees. That said, we are one of very few Newcastle property management businesses who offer transparency around our property management fee structure.
In short, the difference in management fees between agencies makes a relatively small difference to cash flow for the investor. Even still, these fees are tax deductible. There are far more valuable aspects to consider which will differentiate between the offerings of various companies, as outlined earlier in this article.
Changing Property Managers in Newcastle Does Not Require an Awkward Conversation!
Landlords often continue with their current property management company even when they are not satisfied. The primary reasons for this are:
Great news - none of these is the case! As long as you adhere to the notice period required in your Exclusive Management Agency Agreement (usually 30 days, though sometimes 60 or 90 days), you are free to change agents at any time. Even if a tenant is in the middle of a fixed term lease period, you can change property managers without issue.
Plus you don't need to have a difficult conversation with your current agency. In fact, you only need to give notice in writing - and we've got a downloadable change of property management letter template right here.
If you are seeking focused, experienced, transparent and professional property management in Newcastle, contact us now. We'd love to meet you and discuss your investment.
Carnelian Property Management Newcastle NSW
We are a family-owned and run Newcastle real estate agent offering expert property management across Newcastle and Lake Macquarie.