As a property investor, one of the crucial decisions you’ll face is whether to hire a professional property manager or manage your investment property yourself. While self-management might seem like a cost-effective option, it’s essential to understand the complexities involved before making your choice.
Let’s explore both options to help you make an informed decision.
The Benefits of Hiring a Property Management Agency
Professional property management agencies offer a range of valuable services that can save you time, stress, and potentially money in the long run. Here are six key tasks they handle:
- Finding the Right Tenant: Agencies conduct thorough background checks, reference checks, and interviews to ensure only the best tenants are considered for your property.
- Day-to-Day Tenant Management: From addressing noise complaints to discussing rent increases, property managers handle the daily interactions with tenants.
- Property Maintenance and Upkeep: Agencies coordinate repairs, liaise with tenants and tradespeople, and handle all aspects of property maintenance.
- Rent Collection and Financial Management: With specialized software and systems, agencies track rent payments and quickly address any non-payment issues.
- Regular Property Inspections: Managers conduct and document thorough inspections to ensure tenants are adhering to the lease agreement.
- Legal Compliance: Property managers stay up-to-date with relevant laws and regulations, helping you avoid potential legal pitfalls.
The Challenges of Self-Management
While managing your own property can seem appealing, it comes with significant responsibilities and potential risks. Here are some crucial questions to consider:
- Are you well-versed in the Residential Tenancies Act and other relevant legislation?
- Do you understand your legal obligations as a landlord?
- Can you effectively screen tenants without access to professional databases?
- Are you familiar with the proper procedures for handling bond money and rental arrears?
- Can you represent yourself effectively in court if a dispute arises?
Self-management requires a significant investment of time and effort to acquire the necessary knowledge and skills. Without proper understanding, you risk making costly mistakes that could lead to financial losses or legal troubles.
Making Your Decision
Ultimately, the choice between hiring a property manager and self-managing depends on your individual circumstances, including your time availability, legal knowledge, and willingness to handle tenant-related issues.
If you have the time, inclination, and commitment to learn about property management regulations and best practices, self-management can be a viable option. However, if you value your time and peace of mind, or if you own multiple properties, professional management might be the better choice.
Remember, your investment property is a valuable asset. Ensuring it’s managed effectively and in compliance with all regulations is crucial for long-term success and profitability. It’s also worth noting that rental management fees are tax-deductible.
Carefully weigh your options, consider your personal circumstances, and choose the approach that best aligns with your investment goals and lifestyle.
