With capital growth being a seven to ten year strategy, investors in the current property market should be aiming to maximise their annual rental returns, and using a professional property manager is one way to ensure that, according to the Real Estate Institute (REI).
A key component of both the investment property selection and the on-going management of the investment's return is the investor's choice of an experienced property manager, said REINSW President, Rowen Kelly.
"Property management is no longer just collecting the rent. It's a comprehensive management service which can only be provided by a professionally trained property manager. Using an experienced property manager to help you select and manage a property will maximise both your annual investment yield and your eventual capital gain", said Mr. Kelly.
"When assessing investment property opportunities, it is essential that you do your homework and seek professional advice."
Mr. Kelly said when choosing a property manager you need to select someone who knows the law and is confident in applying the law.
"You need to choose a property manager who will pay attention to the finer details and continually strive to maximise the return on your investment.
"Continuing professional education, ongoing training programs and seminars are also important for a property manager to keep abreast of changing legislation and market conditions.
Mr. Kelly said key questions you should ask prospective property managers include how long they have been a property manager, how will they assist in maximising your return and optimising capital growth, how many properties do they manage, what formal training have they undertaken, how do they communicate with their lessors (owners) - i.e. regular newsletters, what is their policy on managing arrears and regular inspections, when will you receive your rent money and how often do they carry out fair market rent reviews?
"Other questions you should ask include when will you receive your rental income and how often do they carry out fair market rent reviews", he added.
Mr. Kelly said that if a prospective property manager answers yes to these questions and can produce the evidence required, then you are dealing with a real estate professional.
"Using a property checklist is a good start to choosing a suitable property investment area with strong demand for rental properties. Potential investors should ask an experienced property manager questions such as whether neighbouring areas are experiencing strong demand for rental properties."
