Cheap is not always cheerful
Many agencies are offering cut-price property management fees and some investors are being tempted. But be warned; choosing a property manager based on the lowest fees comes with risks and, for many, may end up being a costly mistake.
Property management is an important part of keeping your investment property safe and secure, so it pays to choose your property manager carefully. But with a number of agencies trying to lure investors with ultra cheap management rates, some investors are basing their decision on fees alone, which could end up proving costly.
When it comes to property management, as with a lot of things in life, you often get what you pay for. While a very low management rate may seem attractive, most investors soon learn that it costs them more in the long run.
Agencies that offer discount rates usually use these rates as bait to attract new business, then sting investors with many extra and overpriced services. Once you add these additional items into the mix, the cheap rate isn’t so cheap anymore and owners end up paying the same price for a budget agency than they would have with a superior one. Worse still, if owners don’t opt for the extra services, such as regular inspections, the condition of the property may suffer.
Agencies that offer cheap rates have to make many sacrifices to make the business profitable. One area where this is often apparent is in the number of properties serviced by each property manager. Property managers in these agencies are often inundated looking after hundreds of properties and are too busy to properly service any individual property. This leads to high staff turnover.
The other area sacrificed is in staff training. With profitability wafer-thin, these agencies cannot provide their staff with the ongoing training and education needed to keep them up-to-date with legislation and changing market conditions. This too can contribute to higher staff turnover and the staff’s lack of knowledge can leave owners out of pocket.
At the end of the day, it is not feasible to expect a high quality service with all the necessary inclusions for next to nothing. Owners need to ask themselves, are we willing to risk the security and performance of one of our most valuable assets for the sake of potentially saving a couple of hundred dollars a year?
Here at Momentum Wealth, we strive to provide the lowest fees possible while continually investing both time and money into our high-performing team. Our property managers are regularly trained, care for a smaller amount of properties than most, and our management style is simple and transparent. If you are looking for an agency that is at the forefront of property management and willing to deliver an impeccable service as promised, then speak to one of our property managers today.