Does your property manager need to be local?
Modern technology has allowed for many changes to occur in most industries, real estate and particularly rentals or property management is no different, and in fact has probably benefitted greater than many other industries.
The days of property management being an "add on" to a sales office are gone, and this has occurred for a variety of reasons, including: technology, more complex legislative requirements, and change in mindset of tenants (although this can primarily be attributed to technology).
Let's look at these reasons individually:
1. Technology: with the adoption of internet advertising and increasingly the end of local paper advertising for rental properties, prospective tenants are no longer calling into real estate offices to find out what properties are available, and no longer is it a practice that prospective tenants will collect keys from an office to go and inspect a property unaccompanied (if ever you come across an agent that still allows prospective tenants to collect keys and inspect a property unaccompanied immediately cross them off your list), internet marketing has led to greater use of "Open for Inspections" by property managers with tenants scanning the popular websites to check for inspection times and then arriving at the property at the set time, often this is the first an agent has heard from this person. Expensive, high profile offices are no longer required to advertise properties and attract potential tenants, instead quality internet advertising is the main requirement. Once leased, tenants are now making their rental payments through a variety of methods, Direct Debit, B-Pay, various rental card programs, internet banking, or directly deposit at the agents bank, they no longer need to go into an agents office to pay the rent. So with advancements in technology location of the property manager is no longer an important factor in either leasing the property, collection of rent, or ongoing management. What is important is the agents acceptance of a property location and their preparedness to travel to the location to conduct inspections, whether they be prospective tenant inspections, condition report inspections or routine inspections.
2. Complex legislative requirements: whilst I have mentioned legislative requirements above, I will save a more in-depth discussion on this for a future post, for now, I will just comment that it is important that your property manager (this includes the property manager, and the business owners) understands the business of property management in detail, the associated risks, and how to best service both landlords and tenants to achieve the best possible outcomes. Property management and real estate sales are vastly different businesses, and need to be treated as such. I am not saying sales and property management can not exist in the same office, but if they do, you need directors that understand both aspects of the business in detail.
3. Change in tenant mindset: In years gone by tenants relied on local paper advertising, and rental lists collected from offices to find a home to rent, once they found a home, they were required to pay rent at the real state agents office as their was no internet banking, b-pay, direct debit etc, instead it was cash or cheque direct to the agent. Technology has changed this, and it has led to a change in mindset of both agents and tenants, it is becoming rare for tenants to now visit an office, when they do need to communicate with the agent they will ring or email, and all other functions can be undertaken without visiting an expensive high profile real estate office.
So what do these changes mean to you as you consider appointing an agent to manage your property? You now have more choice, there continues to be property management businesses associated with sales offices, but also you have stand alone property management offices, home based property managers and mobile property managers. Which of these is best? the answer is that no business model will necessarily provide a better service than the other, it is the person managing your property that is the most important factor, and the level of knowledge, expertise and service that they contribute. Location should no longer be a factor to a landlord in making their decision of who to appoint, yes agents will place limits on the distance they are prepared to travel, but a well managed and setup agent will be able to provide you with an exceptional service whether they are located 50 metres, 2 kilometres or 200 kilometres from your property. Choose your agent on the basis of knowledge, expertise and service, who do you trust to achieve the best outcomes for your investment, and if this means an agent that is not "local" to your property then go for it, appoint the best manager, not the closest manager.