Are property management companies worth it?

I

imalwayshappy

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Hi,

My tenant has given notice and I am looking at giving the property over to a management company based in Cork city. Are they worth the cost? 10% of the rent seems good value to me considering they manage all aspects of the property. Anyone have any positive or negative experiences with them?

Thanks
 
Rented our first residential property (as an investment) this year and used a management company and so far they have easily paid their costs. Viewings would have been very tough, but they came along and did a video tour, prepared potential tentants, checked them and in the end had someone on their books already who was perfect. They've sorted all problems like getting boiler serviced, replacing appliances etc.

For the 10%, it has been absolutely well worth it. Plus its 10% off the "gross" earnings, so its 10% before you pay tax. After tax, not really even 10% :)
 
I used a management agent years ago. They charged a finders charge and then a monthly cut of the rent.
The first 3 years were fine. Same tenant. No issues.
Then changed tenant.
They charged me the finders fee for that tenant. The tenant stopped paying rent after a few months. Thank God they left.
But the place was damaged and cost a lot.
The agency got another tenant and then i found out they had charged me another finders fee. Even after the last one didnt even stay, but also wrecked the place. That tenant left after 3 months too.
So I parted company with the agency and did it myself. And it was fine for any tenant i dealt with after that.
But I looked back at the accounts for when it was with the agency and found that they were doing thinks like charging me €400 for a hob. €800 for a fridge. An armchair was €500. And an extractor fan was €350.
Ive had all those things replaced in my own house over the years and you wouldnt pay those prices for what i got in my own house, never mind a rental property.

I wouldnt touch an agent again. Especially now that if they mess up you could have a tenant not pay you for 2 years and the agency has no responsibilty for that.
 
The big advantage of an agent is that they have a painter/plumber/roofer who will take their calls and will generally do the work. Many also get a 10% discount on white goods.

In my experience they don't find particularly good tenants. They are very much compliance based, they just want references and payslips that look reliable. They don't have any unique insight about human character.
 
I have used the same letting and management company for years . I could not manage my properties without them and when I go on holidays I
trust them to take care of everything ( I even send them a Christmas present )
 
robert 200 said:
I have used the same letting and management company for years . I could not manage my properties without them and when I go on holidays I
trust them to take care of everything ( I even send them a Christmas present )
Click to expand...
Is the gift tax deductible???? :)

What would be an appropriate gift for a letting agent can i ask?
 
Can I ask is the lease with myself personally or with the property company themselves?

I assume once my tenant pays their rent I will receive the rent less their fee?

I have heard a story recently where the property company retained rent on a number of properties due to the fact that they were losing rent on other properties on their portfolio.
 
imalwayshappy said:
I assume once my tenant pays their rent I will receive the rent less their fee?
Click to expand...
It depends on the model.

Some agencies collect rent from tenant monthly, keep their %, and then distribute landlord. Some agencies collect their % annually in advance and then the tenant pays landlord directly.


The lease is between tenant and landlord with the property management company named as agent. Landlord then has a separate contact with the property management company which is nothing to do with the tenant.
 
It completely depends on the agent. I've had both very good and very bad experiences. If you don't want any hassle with tenants and find a good agent it definitely is worth it but you'd still be well advised to keep an eye on what the agent is doing (what they're charging you for repairs etc.) and on the property - an occasional inspection just to make sure all is ok. The agent should inspect periodically but they won't care about the property as much as you do. I had an experience like a poster above where the owner of the maintenance company engaged by the agent was actually a director of the agency, so there was every incentive to charge as much as possible for repairs which led to some ridiculous charges - €300 for a minor oven repair that I knew should have cost €80 etc. etc. Some have integrity and others are unscrupulous, like any business I suppose.
 
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