When is it worth changing your property manager?
By Chris Uren
Director, Independent Property Group
Is your investment underperforming? Are you sick of being told that it’s “just the way the market is” while people all around you are getting great tenants? Have you been left in the dark about the state of your property?
If you’re unhappy with your current property manager, here’s how to make the change.
When is it worth changing your property manager?
Your property is sitting on the rental market too long
If your property is sitting empty, it’s costing you money. Getting a good tenant for your property should be the highest priority for your property manager — even when times get tough.
Changing property managers can help expand into an untapped market of tenants. Canberra’s population is growing, with more people than ever moving to the country’s capital for education, work opportunities and more. You need to ensure you have a property manager who knows the market well.
Poor communication with your property manager
Some communication issues can be remedied with a conversation. Others can become a more serious problem. If your property manager doesn’t return calls and is slow to update you, consider a switch. Changing property managers or even moving to a new property management company would help keep your finger on the pulse when it comes to the property market.
Your property manager changes frequently
Some agencies have a rotating cast of property managers. This means that they won’t be as familiar with your property. It may also imply that there is high turnover in the company: indicating deeper problems.
A dedicated property manager will know your property and its history. If your company can’t offer that, you aren’t getting your money’s worth.
Infrequent or rushed routine inspections
Routine inspections are the primary way you know your property is being taken care of. If they’re not happening on time, or at all, it’s a big red flag.
If they are happening, are they thorough? Are you able to access the photographs and the written report? They should be sent to you immediately after the inspection but can also be requested at any time.
Poor tenant relations or infrequent maintenance
Complaints from tenants about how they’re treated, or if tenants are leaving due to dissatisfaction, can also signal that your property manager isn’t providing a positive rental experience.
An important part of this is regular maintenance of the property. Every property undergoes some wear and tear, which is normal during tenancy. If maintenance issues aren’t being addressed promptly, or you’re finding out about problems from tenants rather than your property manager, this can lead to larger, costlier repairs down the line.
Changing property management companies can help if the current management isn’t meeting your or your tenant’s needs.
What are the steps involved to change your property manager?
Step One: Check your property management agreement
It will set out:
- The length of the agreement (usually 12 or 24 months)
- The notice period you need to give if you are ending it early
- Any termination fees you have to pay
Changing your property management company mid-agreement depends on the agreement. Apart from the notice period, there may be extra clauses related to agreement termination, resulting in a fee. Check your agreement carefully and speak to your current property manager if you have any questions.
If you have tenants, don’t worry. Changing property managers mid-lease is generally a smooth process and doesn’t incur any extra charges. The new property manager or company will take over and contact your tenants to ensure a smooth process. At Independent Property Group, we ensure that we’re supporting both existing landlords and tenants looking for rental property during this transition and maintain open lines of communication.
Step Two: Select your new property manager.
The first step is to ask family and friends for recommendations and check out business reviews. They’ll give you a good idea of what it’s like to work with an agency (BTW, Independent Property Group is Canberra’s most 5-starred property management agency).
Once you have a candidate in mind, set up a property appraisal conversation with them. Make sure you ask:
Step Three: Inform your property manager.
From here, it’s smooth sailing. Send an email to your old property manager giving them notice that you’ll be terminating the agreement. CC in the new company and let them do the rest.
It’s important to hire your new property manager before you give notice or end your agreement to ensure a smooth handover.
How to handle breaking up with your old property manager
Keep it simple and straight to the point with our template.
Changing property manager letter
Subject: RE: [Property address]: Notice of Termination of Management Agreement
Dear [current property manager]
This [letter/email] serves as written notice that I/we will be terminating your management agreement after [date]. This accords with the [number of days] notice required by that agreement.
Management of the property will be taken over by [name of new property management company]. They will be in touch to arrange the handover of keys and any relevant information.
Thank you for your assistance in managing [property name]. I/We wish you all the best.
Kind regards,
Make sure you CC in your new property manager. They will manage the handover for you, including:
- Collecting the keys to your property
- Getting all current tenancy documents, including compliance documents
- Making contact with your tenant to let them know of the change
- Getting a log of property maintenance history and list of service providers
- Obtaining a copy of any property marketing materials
Can I change my property manager mid-lease?
You can change your property manager anytime, including mid-lease. The tenancy agreement is tied to the property, not the property manager. All of the documentation stays with the property and can be collected by your new agent.
Some agencies have exit fees when the tenant is in a fixed-term tenancy. If you're looking to switch to Independent Property Group, we can work with you to help with this.
Sometimes, mid-lease is the best time to change your rental agent because your property isn't sitting vacant while you make the switch.
The new property management company can send a change of property manager letter to tenants informing them of the change. This letter is important because it outlines the following:
- contact details of the new property manager;
- emergency contact details;
- new payment instructions;
- timing of the transition;
- upcoming inspections; and
- any other information about the lease.
Changing property manager fees
Your agreement might include a fee for early termination. It’s almost certainly worth it to make the change.
A good property manager can get you better tenants and higher returns. They’ll also work with you to be proactive about improving your property’s value. Plus the peace of mind? Priceless.
If you’re concerned about exit fees, talk to us at Independent and we’ll work with you to make your exit easier.
If your current property manager is not meeting your needs, contact us for more information about how we can help. We offer a wide range of property management services in Canberra and can tailor a package to suit you. Get in touch below.
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