If you’re a busy landlord looking to alleviate some of the workload in managing your investments, then a property management company is a sensible option.
The key questions when looking for a property manager are:
- What does a property manager do?
- How much are property management fees?
- Where to find a good property manager?
What does a property manager do?
The duties of a property management company can fall into 4 buckets
- Tenant and occupancy
- Facilities management
- Legal & Admin
First & foremost, the property manager must be able to find you tenants for your rental property.
Right Move is the market leader, receiving 127.5 million visits per month. Zoopla says its websites (including Prime Location) and mobile apps attract over 50 million visits per month.
Once the marketing is done, then the job of a property manager is to manage inquiries and ensure potential tenant questions are answered quickly.
Tenants move quickly and look at multiple property options, so a property managers ability to quickly respond to questions is vital.
This increases the importance of property manager opening times. If questions are coming in from tenants over the weekend when the property manager is closed, that could mean the tenant ends up elsewhere.
The property manager will then need to be adept at turning the tenant’s interest into a tenancy. This will include showcasing the property benefits and how amazing it would be to live in the property.
Tenant and occupancy
Once a tenant is secured & wants to move into the property, the property manager will need to ensure all the checks and prerequisites are in place.
The tenant will need to have background checks done on their credit & reference history and sometimes immigration status (no landlord wants a tenant who has a bad history of paying people back on time!).
To finalise the occupancy, the property manager must handle the tenancy agreements, deposits & rent collection.
A tenancy agreement is a contractual document between the tenant and property manager, detailing the terms of the agreement. This covers exit terms, notice periods, rent amounts, payment schedules etc.
It’s important to note, that some agreements, depending on the complexity of the arrangements can be created bespoke to the tenancy. However a majority are based on a template used across multiple tenants and properties.
Once the agreement is in place, a deposit must be taken to secure the property & protect the landlord against early exits & damages.
When a property management company (or landlord) is taking a deposit for a tenancy, they need to protect it in a government authorised scheme to meet legal obligations.
The DPS is one method of doing so. A deposit protect service acts as a custodian for deposits, helps with disputes and assists repayments between property managers, landlords & tenants.
Rent collections are a big part of a property managers duties. Whether the arrangement is a scheduled electronic payment or a door to door cash exchange, this activity needs to be tracked properly.
Missed payments need to be followed up on, including the issuing of late payment fees.
A property manager needs to ensure the property is safe & secure for tenants.
Safety checks need to be in place, proving the property is ready for occupancy. These checks include, but are not restricted to;
- All appliances, chimneys, flues and pipework need to be in good working order
- An annual gas safety check need to be performed
- Provide an Energy Performance Certificate for new tenants
- All fittings and appliances (light switches and wiring, kettles and toasters etc) are in working order
It is prudent to keep a record of all checks for at least two years
Additional facility management work includes ensuring any major property issues are fixed within good time. Broken windows, locks & doors need to be fixed. Property managers usually have a good network of contacts to fix issues quickly.
Landlords should note, that ball park costs for potential damages should be agreed beforehand to ensure both parties are happy with potential costs.
Legal & Administration
The property manager will also stay on top of documentation. It is easy to forget when a tenancy expires, when certain property insurances end and when new regulations hit the market.
In 2019 a ban on tenancy fees was implemented. This restricted the type of fees property manages & landlords can inflict on tenants.
Property managers will need to stay on top of these types of market changes and adjust their policies and operations accordingly.
How much are property management fees?
When getting a property manager, one critical factor is the price. Property manager charges vary, some determine a fixed fee while others charge a % of the rental income.
Generally a property manager will charge between 9-15% of the monthly rental income.
Landlords must check terms & conditions to ensure all the services required are within the agreed price.
Add on services, not included in some of the basic property manager charges, can decrease a landlords rental income significantly. Therefore examining the services precisely on offer are essential before deciding on a property manager.
In addition, property managers often have promotional offers that a landlord can use to reduce their costs. Often if more than one property is given to the property manager or the rent is over a certain amount, discounts are available.
Where To Find A Property Manager?
Rent Round is the best place to find your property manager.
Landlords can enter their postcode and the type of services needed from a property manager, then Rent Round finds rated property managers near the landlord’s property.
Landlords can quickly view property manager fees, types of services offered, ratings, number of years in the industry and the regulatory schemes the property manager abides by.
Simplifying the process even further, the landlord can then choose which property manager they want a quote from. Following which, the property manager will be in touch with further details.
Rent Round is completely free for all landlords, always!