Spending up to three hours a day dealing with problematic landlords will eat away at business profits, according to Leading Property Managers of Australia director Bob Walters.
“As a property manager, dealing with problem landlords is part of the job, but if you find yourself spending up to three hours a day dealing with the same client, all profits made from their business will be completely swallowed up,” he said.
With reference to Sydney, Mr Walters said average property management fees are approximately $1,400 a year, which breaks down to approximately $27 a week.
In order to make a profit from a ‘problem’ landlord, agents may need to negotiate higher fees with their client to combat the large amount time and resources spent dealing with their concerns.
“If you find your client is being unreasonable and taking up a lot of your time, most agents will attempt to negotiate with them and assure the client they are a professional that can handle the matter in an effective manner,” he said.
“In dealing with my business, I have assessed our client base and identified the clients that continually take up several hours of our time. From there I will negotiate higher fees with my client and in some cases will terminate the contract if an agreement cannot be made.”
These comments were in response to a recent Real Estate Business straw poll of 238 respondents where three in four agents (74.8 per cent) believed up 10 per cent of their property management business was made up of ‘problem’ landlords.
REIWA property management network co-chairwoman Jenni Wood told Real Estate Business, agents need to thoroughly inspect the property and landlord prior to taking the listing.
“The problem is a lot of agents spend a lot of time assessing a tenant during the induction stage, however spend little time assessing the landlord,” Ms Wood said.
“If 10 per cent of your property management business is made up of trouble clients, agents will easily be spending up to 40 per cent of their time resolving these problems.”