Managing your own Investment Property may save you a few dollars but is it really worth the risk. For those of you who are considering renting their property privately consider the following risks.
1. Sourcing Tenants – Professional Property Managers have instant access to a pool of potential tenants. As a DIY Landlord there are a limited number of places you can find a prospective tenant.
2. Placing the right Tenant – Although this sounds like an easy task, many DIY property managers get it wrong. Many of the people who look for private ads generally don’t have the best rental history and know that private landlords often don’t check out their past as thoroughly as agents do.” Choosing the wrong tenant can lead to many expensive problems down the track, such as not paying rent on time or a tenant trashing your property, which can be both time consuming and expensive to fix.
3. Knowing the relevant laws – Every state has different rules on owner and tenant rights, and as a DIY property manager you need to make sure you learn the relevant legislation and ensure that you do everything ‘by the book’. The law guides everything from how much notice you give the tenant for a rent increase, to sending out a tribunal notice, to how often you can inspect your property. Property investors engage agents because they are experts in their field. A good agent will know all of the relevant legislation and practice it. As a DIY landlord, you need to make sure you do the same.
4 Failing to protect your assets and income – It’s not only important to know the relevant laws, but it’s also vital that you look at ways to protect yourself and your asset. For example, professional Property Managers make sure that before any tenant moves into a property they do a thorough written condition report and take lots of detailed photos of each room. This ensures that they don’t have any disputes over the condition of the property at the start and at the end of the tenancy. Many DIY landlords don’t do this and then have to pay for any damage caused, because they have no proof.”