A false economy made by many first time investors is to manage their own properties.
Blogger: Rory O'Rourke, O’Rourke Realty Investments
Tenant selection is critical for anyone buying an investment property because selecting a bad tenant can result in unpaid rent or damage to the investment property.
To avoid problems associated with tenant selection it is worthwhile engaging the services of a professional property management company. Below are ten reasons landlords should use the professional services of an experienced property management company rather than managing the property themselves.
1. Do you possess a thorough understanding and knowledge of The Residential Tenancies Act in order to maintain a fair and professional relationship with your tenant? Recent changes to the ACT have important implications for landlords.The tenant may sue you if you conduct yourself outside the Residential Tenancies Act!
2. Do you realise that as a private lessor you do not have access to tenancy default databases? Some of the good agencies will have also bought a national tenancy database which is crucial with the number of tenants moving to Western Australia for work. Therefore, tenants listed on these databases are forced to rent privately?
3. Have you lodged your tenants’ Bond money in accordance with the Residential Tenancies Act requirements and within the required timeframe? If not, you may be liable for a heavy penalty.
4. Do you have the time to conduct detailed property inspection reports to ensure that the investment property is well maintained?
5. Do you know the right procedure when dealing with rental payment arrears? Have the correct notices been issued with the required excess days in the calculation of notice period? If not, your advices may be totally invalid and you will have to start the procedure all over.
6. Do you have a concise knowledge of The Residential Tenancies Act to effectively represent in Court? The procedure must be precise. If you are ill prepared with non compliant documentation, invalid notice periods or lack of evidence, justice may not fall on your side. Minor mistakes may cost you dearly!
7. Could you successfully terminate your tenancy and recover possession of your property without the need to go to Court? Do you know the correct procedure, the right notices to issue and the correct time frames? Is your negotiation skill and knowledge of the Act sufficient to mediate a successful resolution and outcome?
8. Could you complete a valid Property Condition Report with enough detail to stand up in the Magistrates Court if necessary? If it is not a precise record then it may have little or no value if needed for evidence.
9. Do you know the correct procedure when the tenant has absconded and abandoned goods remain at the property? The Residential Tenancies Act has a range of procedures that must be followed when goods are left at the property.
10. The services of a professional property management company are tax deductible. If you have several investment properties, this services is particularly invaluable.