Owning a rental property is becoming more complicated. Over the last few years there have been a myriad of compliance changes, largely aimed at making the tenant’s journey more pleasant but this also served to create some doubt and uncertainly with property owners. We’ve heard that some landlords question whether owning a rental property is still worthwhile, especially from landlords whose properties are not compliant.
The new rules (Link to previous article) are not all straight forward as was covered in our past 2 articles.
Having your property managed by professionals is an obvious choice for those that are about to throw up their hands in frustration or those that are close to resignation.
The truth is that employing a property manager is likely to take the pain of managing your properties towards a gain.
1. Knowledge of other rentals in the area
Private landlords may not be up to date with rental prices in the area and may miss out by not charging enough. They may also want to avoid a conversation about adjusting rents to the going rate. While that may be entirely OK if the financial return from the rent is not the major consideration. We come across landlords that place more emphasis on having good, reliable and long-term tenants than maximising rent. Both can however be achieved.
2. Tenant Selection
Signing up new tenants is a risky time for any landlord. What you decide here may have a lasting impact on your tenancy. Some tenants can bring along some unexpected and unpleasant baggage. The only time a private landlords gets “to know” a new tenant is during the “open home” – hardly sufficiently long to make a meaningful choice.
There’s a good chance that a property management company will have some previous knowledge of tenant behaviour, or will have done a thorough tenant selection process that can minimise risk.
Frequently, property management companies can fill tenancies with applicants from their own database, where a history has already been established.
A tenant can make or break the enjoyment of a rental property, an in our opinion, thorough tenant selection is one of the most important criteria of owning a rental property.
The rules of compliance have changed significantly and frequently over the past few years, mostly with an emphasis on making tenants more comfortable. The vast majority of landlords and property management companies will be happy about that. At Metro NZ we like to treat our tenants as though they are our “guests”. The result is that our landlords are largely unaffected by the new compliance rules, given that we’ve always worked towards making them feel at home. We are all in favour of mandating these rules and hope that it will improve the negative image that landlords frequently have to endure due to the few “bad apples” amongst them.
4. Rent Collection
Property management companies usually have excellent systems in place to monitor and manage the collection of rent and to manage the tenancy bond.
It’s important that any rent arrears get addressed early and in the right way and a property management company is usually in a better position to do that than a private landlord.
5. Managing other parties
Good property management companies have a ready list of parties that they work with: trades people, financial and legal experts, contractors and the like are easier with work with if there is an established relationship.
If instead, since you’re a DIY person, you plan to do some of the work yourself, then there’s a good chance that some of your weekends are dedicated to maintaining your properties. With a property management company, you can claim back your weekends.
Most private landlords want to be close to their rental properties. That can severely limit their property portfolio, if they can only purchase in the area they live. Many property management companies, including Metro NZ Properties, have services in many location in New Zealand and even overseas.
Owning a rental property should be an enjoyable experience, not only on the day that you reap the rewards from divesting. All investment property owners know that property ownership comes with considerable risk, time investment and hard work. Property management companies can take some of the risks and work out of owning a property and turn it into a positive experience all around.
For more information call Frank or Zsuzsanna at Metro NZ Properties. 09 985 5706