If you are considering managing your first property, there is a list of pros and cons to think about. The first question is, "Is it worth your time?" This is what property managers do; they oversee up to 120 properties and are dedicated to ensuring everything is done correctly. They have the education to handle problems and know the necessary steps if the tenancy tribunal needs to be involved.

Until you look behind the scenes, property management seems low-input. Don't be fooled, though; it's anything but simple. A great property manager's sole aim is to work for you. They take the time to not only find your best tenant/s but also undertake in-depth background checks, media checks, reference checks, credit checks, and up to 15 other checks, depending on what each check reveals. Additionally, they show the property to potential tenants, get tenancy agreements signed, and lodge your bond, so you don't incur penalties for late bond lodgement.

Once a tenant is in place, or if a property is handed to a property manager, they chase rent payments and deal with maintenance that needs to be done. They advise both the tenant and the landlord on who is responsible for each repair. Property managers handle disbursements, take out the money needed for repairs, and pay the contractors, with the balance paid to the owner. They email/call tenants to arrange inspections and follow up on anything that needs rectification. If your tenants don't believe they are responsible for dealing with mold in the shower, the property manager addresses this. They will go as far as getting a tenancy tribunal order to ensure your property is cared for and always keep it completely impartial.

If you are thinking about being a real estate investor, you have two options: either self-manage or hire a professional property manager. There is no right or wrong way, but if you decide to self-manage and find yourself in a situation you don't know how to handle, there are companies that provide advice.

The Pros of being a self-manager:

The best part of being a self-manager is saving the fees that a property manager charges.
You may feel like you have more control over what happens with your property. There is no middle person.
You might feel like, "If you want something done well, do it yourself."
You might feel like you will look after your property better since you own it.
The Pros of having a property manager:

A property manager has experience; they know how to handle situations legally and civilly. They act as the middle person, and personal feelings don't get involved when keeping your property safe. This results in less stress for you; you don't have to follow up on unpaid rent, etc.
They know their field, look out for your best interest, understand the market, and can advise on how much you can rent your property out per week.
You have time to enjoy your investment instead of stressing over it.
You don't have to think about the property manager wanting more work; it's in their best interest to find the best tenant/s that applied to rent your property. They usually give you a shortlist of applicants for you to choose from and do all the homework to recommend the best applicant.
A property manager will likely get a better rate for maintenance; they know who does a good job and who might cut corners to save money. They manage many properties and know the best person for the job.
It is a tax-deductible expense.
The cons of self-management:
The question is, how much is your time worth? It may take more time than you think.
You need to prove you do regular inspections for insurance purposes; if you cannot, some insurances may not pay out in the event of a claim. You need to arrange repairs and follow up.
You need to stay current with property legislation; this will help you handle situations lawfully. Handling a situation incorrectly may have legal implications.
You will not have all the tools that property managers have at their disposal; you may ask too much or not enough for rent. The cons of property managers:
No matter how big the company, there is a chance your manager will not be looking after your 'best interest.'
You could hand over your property to an incompetent property manager. Your property manager could be overcharging you for repairs.
The point of having a property manager was to take the stress away, but your property manager is taking their percentage out of your rent and may not be adding value with advice.
It's an extra cost.
If you get a manager like this, you can move to another manager. It's really that simple; a property manager should be taking the stress out of your life while keeping your investment safe. Here at YLPM, we believe in keeping your costs down but providing you with A+ service. We do not charge for inspections, administration, maintenance, account fees. We have a flat rate of 8.5% +GST, no hidden charges. So, you know what you are going to pay regardless of how much work your tenant/property takes.

Want to self-manage your property?

Managing your property:

So, you want to manage your property? Did you know that a property manager is tax-deductible? It provides you with protection against legislative changes, an independent third party to address damage and repairs, and most insurance companies require proof of inspections; a property manager can provide this. A property manager arranges for repairs with experienced tradesmen, ensuring you are not overcharged, and the repairs are completed quickly and cost-effectively. However, if you are set on managing your property, look into finding a letting service that can help with vetting tenants before giving you a shortlist. The tenants would have undergone a full background, credit, media check and provide a Tenancy Application along with a tenancy Agreement. Why is it important to find your best tenant?

This is important for a few reasons; one being they may have a history of leaving other properties in poor conditions. Do they like to have parties? Did you know under the Resource Management Act 1991 you can be issued an abatement notice lodged against your property if your tenants continually breach noise regulations? Many Councils work on a 3-strike rule, where if your property receives 3 Excessive Noise Direction 'ENDS' issued within a two-year period, they may issue an abatement notice on your property. This means, every time they have a party that is deemed excessive, the tenant as well as the landowner will get a $500 infringement fine, in addition to being lodged on your property file potentially impacting future sales value.

When you're receiving $400 a week in rent but they are getting both of you infringed, you can do the math. When you have a proper agreement, you can breach them under the Residential Tenancy Act 1986 s.40.2.c. Now you will not know about the parties until it is too late and the local council is looking at escalating the matter. If you remove the tenant and explain to the council that you were not aware this was a problem and indicate