Property managers know their value and why investors should use them, but if you understand more about self-managers and the mistakes they make, you may be able to attract more landlords.
Private landlords have an incredible ability to under-price their properties, says industry expert, real estate coach and auctioneer Tom Panos.
“This is because they develop a relationship with their tenant. And then their tenant starts ringing them up and they become good friends, and then they feel like they have this obligation to not to raise the rent too much,” Mr Panos said.
“I see so many properties that I auction on a Saturday that are up to $200 under-rented, and the owner says they are good people and I didn’t want to upset them.”
But Mr Panos said carrying a good tenant simply because they pay the rent is a mistake, because only paying on time is not enough to make them a quality tenant.
Lisa Indge, managing director and founder of property management firm Let’s Rent, said she doesn’t manage her properties. Instead, she has her team do it.
“It allows them to negotiate rent increases without an emotional factor coming in, which I have certainly experienced in the past,” Ms Indge said.
She said keeping yourself emotionally separate from your properties is better for landlords, PMs and tenants.
“You need that barrier between yourself and the tenant, not just for yourself but the tenant reacts quite differently to another party compared to the owner of the property.”
However, not everyone agrees, with investor Julian Lancey saying everybody should manage their own property.
“If you’re capable of doing that, physically capable and smart enough, and have the time and have the skills then you should,” he told The Smart Property Investment Show podcast.
Mr Lancey said he uses apps to help him market and collect rent for his investments.