Why this investor chooses to ‘manage the managers’ for his properties

Find out why, busy as he is as an academic, Mark makes time to “manage the managers” for his properties:

How did you learn to manage your property manager?

Mark Frew: I have property managers who manage the properties. What I do is I manage the managers. That was good advice from the Right Property Group. They said that it’s good that you’ve got the property managers, but it’s good that you manage the managers, which is very true. I remember the first six months having the first property and then the rental statements came in, I couldn’t read them. I had no idea what it meant. After that six months, I actually rang the property manager and said, “Look, can I come in and can you explain to me what the rental statement means?” She was lovely. She went through and she explained in all details, all six months. From then on, I knew how to read all of them and I’d make sure I’d do it because you’d be amazed the number of mistakes they make. It is just outrageous.

Why did you decide to use this strategy?

Mark Frew: When I got my third property, or fourth property, I’ll never forget within the first month they had to do some carpet cleaning. It was going to cost $160. So I got my rental statement, and I religiously go through all my rental statements and put them on a spreadsheet. It takes me about an hour, an hour and a half to do all of this. I check all the rental statements and I’ll never forget the first one. They charged me $160 dollars one month, and $106 the next month. I rang them and said, “Is that a mistake?” And they went, “We’ve made a mistake and we’ve realised that we’ll credit to you next month.” Then they said to me, “You’re amazing because people don’t check their statements.”

Did it ever happen again throughout your property investment journey?

Mark Frew: A second one was just recently. I got a statement from up in Queensland. They had council rates and it was like $1,700. I thought, “What?” So I rang them, and again they said, “Oh you’re amazing, you check your rates. Look, what actually happened was we actually forgot to pay the last quarterly, so we’ve put the two together.” I was going to lose my temper and I thought “Losing your temper is not going to do anything.” So I just said, “Okay, look, can you just make sure the next time you don’t forget?”

Same agent, only a couple of days ago, I got a statement, they had gone in to fix the toilet of the property. “If you didn’t know we were going in to do that, please give them a call.” I gave them a call and said, “I don’t remember you ringing me to tell me that we need to fix the toilet.” And the lady was all apologetic, and again I was going to lose my temper but I thought “No, I’ll just take it cool.” I just said, “Look, could you please make sure that next time you let me know that you are going in to do these things.”

So the Mark Frew system is just something that you’ve created yourself that works for you?

Mark Frew: Yeah and no. The spreadsheet is something that, again, Right Property Group suggested. They suggested two things – they suggested having a Liebig folders and a spreadsheet. It was Kate from Rock Property Group, she sent that spreadsheet over to me and it just works fantastic, so every month I do it for all my owned properties.

When I first started doing it, strangely when I had five or six properties, it used to take me about three or four hours, but I’ve worked out how to do it so I can do it within an hour. One of the reasons why it took me so long is because I used to print them out, and I thought “Nah, that’s a waste of time.”

So, what I do (now) is I’ve got two computers, I got my normal desktop computer, and I’ve got my laptop with my email open, and I go through and just put it on a spreadsheet for each month. Anything that looks untoward gets turned around to my other computer and I send an email straight away saying, “Can you please explain this?”

It sounds like the Google of your property portfolio.

Mark Frew: It helps you to know where things are. If you ask me, “Have you paid the insurance for this property?” I probably couldn’t tell you, but I could get the folders and it’s there. The other advantage of it, too – I mean, I do it every month. So for 12 months you do it, and when it gets to the 12 months, just email it to my tax consultant, and because he’s got all the spreadsheets there, that makes his job easy. It makes my job and his job easy, okay. I’ve had to be strict, I’ve had to be disciplined every month to it.

I hear people talk all the time about being disciplined with money, but I don’t hear people being disciplined with time, and you do have to put a bit of time, so I’ve got to put time aside – “this time is for doing my property.”

Do you enjoy this process?

Mark Frew: No, it's a bit of a chore, but I know I have to do it. It's like a necessity, and Sunday nights, it's the night I iron my clothes, polish my shoes, prepare my lessons for the week, so it goes into “Okay, that is my Sunday preparation."

What is your advice to budding investors?

Mark Frew: I’m glad I did it right from the beginning ... When you have two or three, you can trial and error, too. You’ve got ample time to go, “Oh, does this work? Does this work? Does this work?” By the time you get to 10, it’s going to be a bit of a monster. You just streamline it – so this works, this works better, this works better.

If I can, I’ll go out and have a look, and see how things are going. The thing is, I’m not a very manual person. I’m not very good with my hands but if it’s close by, I’ll go and have a look. Some of the traders are really, really nice. You can ask, “What are you doing? Just so I can get my head around it.

Tune in to Mark Frew’s episode in The Smart Property Investment Show to know more about how you can keep your investment portfolio organised and how property investment can buffer you during career uncertainty.