Property management with an agent

Regarding the tenant selection process, agents generally have more ready access information on potential tenants, such as defaulting tenant databases which provide rental history and other tenant information, e.g. if a tenant caused damage to a property or vacated without cleaning. Tenants with past defaults who are listed on a database often seek out private investors for this reason.

Also, an agent meets many prospective tenants from which to choose the best for your property. Their experience usually allows them to ask the right questions as well as being able to "read between the lines" in relation to the answers.

The lease and condition report can be the most important documents in the entire process and using an LJ Hooker agent to find you a tenant and prepare the initial paperwork for you puts you in the best position for a secure tenancy.

There are many advantages to using an agent rather than managing as an owner, including:

• Private owners are bound by the same legislative requirements when dealing with tenants as apply to agents, so an owner needs to be fully conversant with these ever-changing legal requirements.
• As an intermediary between the property owner and the tenant, the agent can often prevent ill feeling over repairs or rental arrears.
• Management fees paid to an agent are tax deductible.
• A private investor needs to honestly consider if they have the detailed knowledge required to handle the variety of legal paperwork and scenarios, e.g. serve notices if the rent is unpaid; if action has to be taken to obtain vacant possession; to corrently complete leases; to handle neighbour complaints, etc., and to consider if they will have the time and disposition to investigate and follow the requirements of each when the time comes.
• Disputes over late or non payment of rent can be very difficult and emotional when the communication is directly between the owner and the tenant. Agents can often diffuse these difficult situations.
• Professional real estate agents are usually able to negotiate more attractive rates with tradespeople. They also generally have more "influence" with tradespeople due to the volume of work they give the tradesperson. This influence can be very handy when something has to be attended to urgently or after hours.
• Agents are always in touch with current market conditions and rental prices and are able to negotiate the best rent with a tenant.
• Agents naturally attract a greater number of tenants due to a brand name, reputation, location, media advertising, Internet presence and advertising profile. On the other hand, a private investor may need to spend additional funds advertising to find a tenant.
• If properties are damaged and it is necessary for an owner to appear before a Tribunal you will benefit from having an experienced agent handle the matter on your behalf and/or by your side. A lack of experience can result in unsatisfactory outcomes and extra expense if you have to seek legal assistance from a solicitor.
• Generally speaking, quality landlord protection insurance policies are not available to private investors.