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Newcastle Property Management - A Shocking Real Example Of A Landlord's Experience With Another Agency

20/2/2019

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bad property management experience - unhappy landlord

This article serves as a sad reminder that things are not always as promised when you select a Newcastle property manager to look after your investment. We have recently taken on management of a property for a landlord who continues to be astonished by the shocking service provided by their previously-selected agent.

We've since had desperate tenants walk into our office in the hope that there is still life in an application they previously submitted to the outgoing agency.

The quick summary of this more detailed article is:

DO NOT SETTLE FOR A SERVICE YOU ARE NOT HAPPY WITH OR AN AGENT YOU ARE NOT CONFIDENT IN.

As an investor in the Newcastle or Lake Macquarie area, you should not feel nervous or concerned. These feelings are not a "normal" part of owning an investment property in this area. If your gut is telling you something just isn't right, take action. There are far better agents who will provide you peace of mind and open communication.

So why are many property managers so bad at their job?

Research Shows Most Real Estate Agents Are Terrible At Property Management

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:

54% of property managers have less than 2 years experience
63% of property managers do not enjoy their career, yet they choose not to leave
Only 1 in 4 property managers feels positively about their career
43% of those working in the industry believe their next role will be outside property management
30% of property managers are expecting to move to a sales role, seeing property management as a training ground to progress
Out of 6 options, retaining staff was ranked the lowest priority by agency principals

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".

So, what happened in our recent landlord's experience with another agency? Prepare to be amazed...

The Messy Situation - A Landlord Has Concerns About Their Newcastle Property Manager

A long-term investor we work with had passed our details on to a friend, who had mentioned they were not sure about the service they were getting from their local property manager. We gave this concerned investor a call.

The reason for the concern was that the investor had a well-priced, beautifully presented, large home in a sought-after suburb - which had been advertised for lease for 2 months without any success. In fact, hearing about this experience was one of the catalysts for the article "How Long Should It Take To Find A Tenant For My Rental Property?".

Not only was the property vacant for this extended period of time, the landlord was needing to contact the agent for updates on progress. The landlord even needed to remind the agent to set open inspection times.

Perhaps worse still, the landlord discussed whether the asking rent should be decreased to increase the chances of finding a tenant more quickly, but was advised that the agent didn't want to drop the rent as it helped to filter out undesirable tenants. So, the rent stayed as advertised and the property remained vacant.

The Change - The Landlord Makes A Decision To Leave Their Poor-Performing Agent

After an initial conversation with the landlord, we reviewed the asking rent for the property, and confirmed it seemed to be well-priced for the market. There must have been more to the reason the property wasn't moving...

Tired of the poor communication and lack of professionalism from the other agent, the landlord gave notice to their previous agent. The agent waived the notice period and opted to immediately resign management of the property. The process from this point went as follows:

9:30am - the landlord signed a new management agreement with ourselves
10:00am - we attended the property for the first time and took photos for a new listing
12:00pm - a new listing (new photos and description) for the property was posted live to Realestate.com.au and Domain.com.au.

Within the next hour, several calls were received from high quality tenants interested in the property.

Continued Fallout - The Previous Agent Was Not Even Doing The Bare Basics

As interested tenants continued to call about and apply for the property, the holes in the service provided by the previous agent appeared bigger and bigger.

We had several quality applicants ask if they could submit to us the same application they had sent to the previous agent. Wait. What?! That's right. Several quality applications had been submitted to the previous agent, but the agent had seemingly done nothing at all with them.

In discussions with the owner of the property, we confirmed that they had never been sent any of the applications we were receiving - which had previously been sent to their agent.

To put that in financial terms, due to poor performance of the previous agent the landlord missed out on collecting approximately $5,000 in rent. The house simply sat vacant, advertised, and receiving quality applications. And nothing was done by the agent to fill the property.

This is just mind boggling.

The Moral Of the Story For Investors Looking For A Property Manager In Newcastle

Repeating what we stated at the start of the article:
DO NOT SETTLE FOR A SERVICE YOU ARE NOT HAPPY WITH OR AN AGENT YOU ARE NOT CONFIDENT IN.

It is not normal to be consistently concerned about the state of your investment property or the level of service you are being provided.

If you're not sure where to start in considering your options to find an alternative property manager, we recommend contacting us now or spending time reading this article on the 6 Steps to Find The Best Property Management Company In Newcastle.