Should investors feel the need to manage their property managers? Property investor Mark Frew checks his rental statements religiously, especially after some negative experiences with his PMs.
Speaking on RPM’s sister title Smart Property Investment’s podcast, The SPI Show, investor Mr Frew says he uses PMs on all the properties in his 18-property portfolio. However, he’s quick to add that he always checks the reports provided by them after he was burned early in his investment journey.
“Within the first month of getting my third property they [the PM] had to do some carpet cleaning. It was going to cost $160, but when I got my rental statement they had charged me $160 one month and $106 the next month,” he recalled.
“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’.”
Mr Frew isn’t sure if he would have been credited had he not found the error, but he does know he would not have found out if he had not checked his rental statements. Since noticing the discrepancy, he has been even more stringent in his checks, which led to him noticing another issue with one of his investments in Queensland.
“I got a statement from up in Queensland which said the council rates were $1,700. I thought that was high so I rang them,” he said.
Mr Frew said the PM he dealt with commended him on checking his statements. The PM then informed him they had forgotten to pay the last bill which was being combined with the current bill, which explained the high council rates.
“I was going to lose my temper and I thought ‘losing your temper is not going to do anything’, so I just said, ‘Can you just make sure the next time you don’t forget?’” he related.
It wasn’t long before Mr Frew had another issue with the PM in question, this time on property repairs.
“I got a statement. They had gone in to fix the toilet of the property. [The statement] said, ‘If you didn’t know we were going in to do that, please give us a call’ so I gave them a call and said, ‘I don’t remember you ringing me to tell me that we need to fix the toilet’.”
While the PM was apologetic, Mr Frew said the incident made him reconsider using them for his property in the long term.
Mr Frew said one of his priorities in the first six months of purchasing a property was to learn how to read the rental statements, something he has found invaluable in his dealings with PMs.
“I remember the first six months, the rental statements came in and I couldn’t read them. I had no idea what it meant, then I rang the property manager and said, ‘Can I come in and can you explain to me what the rental statement means?’ She was lovely. She went through and she explained everything in detail. 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 I’ve found.”