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Rental Property Management rates

By mickey - 26 April 2012 27

Hello fellow rioters.

This query is for those investors/landlords who lease out their properties through a property management agency. What are the common rates and charges going around at the moment.

Is it worth going through a property management agent or is it better renting out by yourself? Any advice/suggestions is much appreciated.

What’s Your opinion?


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27 Responses to
Rental Property Management rates
1
DeskMonkey 2:14 pm
26 Apr 12
#

Most agency fees are anywhere from 10 – 12% (but possibly higher). If you have a portfolio of properties (more than 1) that you are bringing in, you can negotiate your fees down considering the amount of business you are bringing in. If you have a house to sell or are looking at buying another one I would also try negotiating the fees down.
Unless you’ve had experience as a property manager I would recommend that you go through an agent for your first time. Your agent will (should) lodge a bond, create a comprehensive inventory, provide you with plenty of information about how they work and be in touch with you throughout the whole process. Generally agencies charge two weeks rent to find a tenant and this covers administration fees and advertising – something you can save on if you were confident enough to do yourself.
If you feel confident in searching for, interviewing and arranging leases for your own property/ies I would recommend looking up the Tenancy Advice sites in your state (http://www.tenantsact.org.au/) (http://www.tenants.org.au/) as it provides extremely useful information and checklists on how things should be done.
You will have heard many scary stories about agencies in Canberra, and to find the best match with you, I would ask your friends/family/work people on their experiences and interview each person that is recommended to you. You need to be comfortable with this person because they will be looking after one of (if not THE) biggest asset you’ll have.
Start with local owners before you go the big guns. I have found the smaller Canberra based companies care more about you and customer service than your money.
Also look for experience. Someone who has lived in Canberra all their lives and has worked in real estate for a long time with give you honest truth about rental markets and what to expect. Newer people are more interested in getting your property on the books for commission.
Best of luck!

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2
DeskMonkey 2:22 pm
26 Apr 12
#

Sorry – Websites for landlords:
NSW – (http://www.fairtrading.nsw.gov.au/Tenants_and_home_owners/Being_a_landlord.html)
ACT – I couldn’t find a site specific for landlords but the Tribunal Court website had some good information. (http://www.acat.act.gov.au/residential_tenancy/residential_tenancy)

If you have the time I’d suggest reading both sides of the story so you know what is to be expected from both parties (should you manage the property yourself.)

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3
mickey 3:52 pm
26 Apr 12
#

DeskMonkey said :

Sorry – Websites for landlords:
NSW – (http://www.fairtrading.nsw.gov.au/Tenants_and_home_owners/Being_a_landlord.html)
ACT – I couldn’t find a site specific for landlords but the Tribunal Court website had some good information. (http://www.acat.act.gov.au/residential_tenancy/residential_tenancy)

If you have the time I’d suggest reading both sides of the story so you know what is to be expected from both parties (should you manage the property yourself.)

Thanks heaps for taking the time to advise. This is going to be my 1st investment property so I do want to rent out through an agent. I have heard good things about a couple of different agencies, so I will be talking to them in the next week or so. Additionally, I will try to negotiate with the agency that I am buying the property through, they should be able to give me a good deal if I rent out through them as well? Atleast that is the hope!

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4
VYBerlinaV8_is_back 4:02 pm
26 Apr 12
#

Definitely use an agent – call other investors for referrals.

I pay from 6.6% to 8.5% depending on the the agent.

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5
gp 9:52 pm
26 Apr 12
#

We have 3 with one agency @ 7% + GST each, and used this as a ‘match it’ with another agency for our other 2 properties.

Seeing as the management fees themselves are tax deductible, Mrs GP and I would strongly recommend going through a property manager. Having a professional distance between tenant and ourselves is an aspect we like, and we don’t like having the 2am calls about needing a plumber. :-)

Also the accounting and paperwork management provided by a good agency is a godsend at tax time.

For what it’s worth, Luton in Dickson has been good for us for some years now.

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6
DanielK 10:48 pm
26 Apr 12
#

Have been renting out two or more properties for most of the last20 years.

First up tried the agency who sold me the investment property – not good service, particularly as I was OS at the time. Next time tried a “property management specialist” at a lower rate – constant problems of poor oversight and poor response to concerns.

Tried using the agency from which we bought our next property (Blackshaws in Manuka), but theirs was the highest rate!

Now we use Brightpartners in Manuka and we arein seventh heaven. Minimum fuss, high net monthly rental return and everything sorted out by the prop. Manager. Saving 1 or 2 percent in commission is a false economy when the agency often calls out the maintenance contractors for any little problem rather than assessing the most cost-efficient way of responding to A tenants request. A little thought can end up meeting/exceeding the tenants needs, permanently improving the property and minimizing tenant turnover and it’s associated costs and angsts

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7
Darkfalz 11:38 pm
26 Apr 12
#

If you have good tenants who are interested in staying long term, it’s better to rent directly. If you have a higher turnover place or don’t want to have to deal with potentially bad tenants, better to have an agent do it for you.

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8
mickey 8:53 am
27 Apr 12
#

Darkfalz said :

If you have good tenants who are interested in staying long term, it’s better to rent directly. If you have a higher turnover place or don’t want to have to deal with potentially bad tenants, better to have an agent do it for you.

I will be renting out a unit, so there should be low maintenance but I am still apprehensive in doing this myself. Maybe I can rent directly once I have observed and gained some knowledge and experience in how the system works.

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9
Kurrajong 9:41 am
27 Apr 12
#

I don’t know where you get the 8-12% from; way too high.

Typical Canberra agent fee is 7 to 7.5% + $5 per month admin fee. If they want to charge more, then negotiate. If you are going to pay the rates and other invoices yourself then they cant justify a high fee. Paying bills is not hard, but selecting the right tenant requires expertise.

Ask for a short list of prospective tenants and be included in the decision making process. They should not deliver one tenant already signed up to you (which some do!).

I know of others who pay well less than 7% if they let more than one property.

Everything is negotiable.

Best to operate your first property through a reliable agent. Big is not necessarily best. Experience counts.

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10
Endrey 10:21 am
27 Apr 12
#

I politely request that you stop buying all of the houses using what should be your tax to make my life as a renter more difficult.

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11
am307 12:47 pm
27 Apr 12
#

Darkfalz said :

If you have good tenants who are interested in staying long term, it’s better to rent directly. If you have a higher turnover place or don’t want to have to deal with potentially bad tenants, better to have an agent do it for you.

I agree Darkfalz, I have been renting the same property for over 10 years initially as the other half of a couple and now I am a single parent, looking after the home, with no dilemmas, I am renting through an agency , the rent goes up every year, I know the owners of the property but they are not interested in privately renting to me…frustrating and disappointing as I am not intending to go anywhere.

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12
watto23 1:46 pm
27 Apr 12
#

Endrey said :

I politely request that you stop buying all of the houses using what should be your tax to make my life as a renter more difficult.

Its not that simple.

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13
DeskMonkey 2:20 pm
27 Apr 12
#

mickey said :

I will be renting out a unit, so there should be low maintenance but I am still apprehensive in doing this myself. Maybe I can rent directly once I have observed and gained some knowledge and experience in how the system works.

keep in mind that Body Corporate applies to Units and some townhouses, Agents can also arrange payments for this on your behalf.

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14
ghughes 2:58 pm
27 Apr 12
#

In any other town, we would be embarrassed to air these ‘cost of living pressures’ in a public forum.

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15
mickey 3:18 pm
27 Apr 12
#

ghughes said :

In any other town, we would be embarrassed to air these ‘cost of living pressures’ in a public forum.

That is why we choose to live in the best town in the country.

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