When leasing your property be sure to read the fine print
More and more Australians are having their investment properties professionally managed. They do this in an attempt to mitigate the risk of damage and being left short-changed by future tenants. Depending on your location and the agent, a property manager will charge a commission of anywhere between 5.5% and 12%. Usually the first train of thought for most landlords is to find the manager with the lowest commission and go with them, it is an investment after all.
But what most people don’t look into is the fine print, the extra fees and charges associated with managing your investment. Fees such as marketing, letting fees, re-letting fees, statement fees, tribunal fees and more. These fees make a huge difference to your balance sheet at the end of the year.The re – letting fee alone can be as little as $20 through to 2 weeks rent, and if your tenants are paying the national average of $486 per week for a 3 bedroom house, that’s as much as $972 per year per tenancy.
So when choosing between two property managers for your investment property leasing at the national average, one is 8.8% and the other 7.7%, and you were thinking the difference is too much, the actual difference in commission is just $277.99 per year or $5.35 per week. By just looking at the commission rate and choosing “the cheaper property manager” you could very well be picking the agent that is far more expensive come tax time.
Looking to lease your investment property? Contact peakagent.com.au and let us do the legwork when finding you the best property manager and the best deal.