Is it better to rent yourself or let the agency do it?

[banenz]

Hi guys

My first post!

We are about to purchase a new house and rent our current one (west akl).
I am just wondering whether we should venture into this rent business ourselves or let the agency do it?
The work that the agent does instead of you, can it be easily managed by us?

What are pros and cons for these two options?

New and totally confused with all this.

Thank you all.


Regards

[LevenRiver]

Have a read of this thread - some useful info

http://www.propertytalk.com/forum/showthread.php?30653-Getting-tenants

[NovInvestor]

Managing rental yourself requires a lot of learning and be able to know a lot of things regarding the procedure of filling out a tenancy agreement correctly, collecting bond, tenant selection, communication, etc.

[artemis]

It depends .... on how good (or bad) the property manager is and how much time and effort you are prepared to put into learning the ins and outs. PMs are variable, and there are many posts here on the good and the bad. Personally, if you live fairly handy to the rental I think it worthwhile doing it yourself. This is because it is the best way to learn. You will make mistakes. (A PM might as well of course, it has been known.) Start by reading every single word of the Tenancy section of the DBH site (www.dbh.govt.nz). The residential Tenancies Act is the bible, but the DBH site and forms will get you started. Suggest you then make a detailed checklist of what you need to do to find good tenants, get them signed up, manage the tenancy and keep up with the accounts / tax stuff. Plenty of good info and helpful people on this Message Board so ask plenty of questions.

[Glizzle]

Hey guys, have been reading for a while. Really Good Forums
I liked the idea of buying close. I got my first rental maybe 2-3 hours away, but mum lived right next door and over the past few years i delt with all issue that arose and learnt the ins and outs of what a pm would do.

I have just redone the mortgage and set new rental rate and signed mum over as landlord at 7% to manage and do whats needed. She doesn't want the money, but ill rather no a true ball park cost of the rental.
But like anything, the more you no about what there doing the happier your going to be about paying.

[flyernzl]

When you manage the rental yourself, realize that you are engaging in the accommodation business.
Do you have the time and energy to run a part-time business as well as continuing with your day job?

If you do, then go for it.
A Property Manager is not a magic cure-all for the problems that will inevitably occur.
I have been managing my own rentals for 21 years.
It does take time and effort to do it properly, but in my view you will do a better job.
There is a bit of a learning curve, but its not all that difficult.

[mrsaneperson]

Well i think the cons outweigh the pros. I often get called out by my tenants to investigate a simple problem often plumbing or electrical. On the odd occasion i call a tradesperson, but mostly i have been able to sort these things out myself potentially saving 100's of dollars . An agency will usually just call out a tradesman without actually going to have a look first.Read $$$$$ Why is this? Because most agents are clueless in a practical sense. Another agency con is that many charge for inspections around $90 each ,one agency quoted me .There are usually 4 every year. This is in addition to the usual agency fees. Many agencys dont vet tenants properly & dont carry out a lot of background checks.
The pros are they would generally have a greater knowledge of the RTA than the average landlord. Its important to follow correct protocol.Also they are in a sense intermediarys between tenant & landlord acting as a kind of buffer zone & possibly seen by Tenancy Tribunal as having less "conflict of interest" than landlords.

[banenz]

Hi

Thank you for replies.

So there is more to it, than just following the RTA word to word from DBH ?

Been reading the document, and it seems pretty straight forward?


Thanks

[KatieR]

That depends on how personally you take your new property. It may be your investment, but your tenants are your customer. If you see it as your house, and want them to treat it as you would, and don't like having to go out to fix the toilet/shower and expect tentants to wait until you've seen it, then called a plumber, who may or may not see it the next day, get an agent. If you can be dispassionalte and understand service, you can save a lot of money. Just carefully choose tenants and theDBH has a course for 1st time landlords whihc should help

[Kaye]

WHOA MrSAnePerson

I'm a Property Manager in Christchurch and OK I may in the minority here but I personally go and sight ANY repairs or maintenance on the properties I manage BEFORE calling the Owner then Contractor if required simple stupid problems I deal with myself AFTER consulting with the Owner.

As for being CLUELESS I maybe Female BUT I am fluent in Building terms so much so my Contractors know if I call them in that the issue I've described to them is EXACTLY what they'll find.

As for Vetting prospective Tenants absolutely I check everything including Tenancy orders on-line as do most of my colleagues.

Inspection fees of $90 each I WISH! I charge what I consider a reasonable fee of $45/inspection this is a comprehensive inspection that includes interior and exterior of the property.

So please don't lump all PM's in the same basket thanks.

[artemis]

I would say tenant selection is the number one thing to get right. That means, in summary, don't make the decision on the spot. Check references, check the online Tenancy Tribunal database for any history, credit check (try TINZ), only after all the checks go with your gut. Make sure the Tenancy Agreement names all the occupiers and puts the maximum number. Be very clear about pets in the Tenancy Agt. Most LLs don't allow any for very good reason.

[banenz]

I would say tenant selection is the number one thing to get right. That means, in summary, don't make the decision on the spot. Check references, check the online Tenancy Tribunal database for any history, credit check (try TINZ), only after all the checks go with your gut. Make sure the Tenancy Agreement names all the occupiers and puts the maximum number. Be very clear about pets in the Tenancy Agt. Most LLs don't allow any for very good reason.

Hi Artemis

Thank you for your advice.
Looking at what you have suggested. Should I go ahead and add my own bullet points/conditions to the already existing ones in the DBH RTA?
I would actually really like to see what you guys use. Is it your own RTA template, or you use the DBH one?
If someone could PM me and empty template they use, that would be awesome.


Thank you all!

[Perry]

So please don't lump all PM's in the same basket thanks.

To be fair, the remark was qualified by the word most. The record
of threads on PT indicates there are far more poor quality PMs than
the reverse. You sound like you're an exception, Kaye. But, based
on many PT threads, good PMs are indeed exceptions, rather than
the rule. Don't take it personally.

[banenz]

Hi

I have been adding/editing the DBH RTA.
What I have added are these.
Can you please advise if they make sense, and would be valid if need be?

The tenant shall not keep pets at the premises.

The tenant agrees that only person-s named above (tenants details section) will live at these premises

The tenant agrees that the maximum number or people living at these premises will not exceed 3

The tenant agrees that if the carpet is not reasonably clean at the end of tenancy, landlord will require it to be professionally cleaned.

The tenant agrees that he/she is responsible for content insurance.

[LevenRiver]

Why do you want them to be responsible for content insurance? If they choose not to have it, that's their choice?