INVESTMENT SERIES
PART
7 First Time Investor Guide
KNOW WHO TO TRUST
Finding a rental agent
BY MONIQUE DU TOIT
F
or many first time investors, the thought of paying an agent to manage your property might seem unnecessary. Whether or not you choose to make use of this service will depend on your circumstances: do you have time to deal with viewings, background checks, maintenance, or evictions? And, more importantly, do you have the necessary knowledge to do these things in the right way?
For most of us, the answer would be no. This leaves us with the inevitable choice to call in reinforcements in the form of a rental agent. Before you do, there are a few things to look out for.
Know what you’ re paying for
There are two types of agents involved in the rental process: letting agents and property managers.
A full property management service will take care of the entire rental process. This includes advertising your property on relevant platforms, screening and selecting a tenant, and setting up the lease agreement. Once the tenant has been placed, the property manager will also be responsible for collecting rent, checking on the property and managing any necessary repairs, and serving any notices.
Letting agents, on the other hand, only take care of the initial process of advertising the property and placing a suitable tenant. The day to day management of the property, including collecting the rent, is the landlord’ s responsibility.
Tenant placement
David Beattie, author of The Expert Landlord, explains that tenant placement is the first and most crucial step in being a successful landlord.“ The success or failure of your property investment begins with the placement of a quality tenant,” he says. The first step in the process is marketing your property at the right price. Aim too high, and you risk having your property sit on the rental market for months.
When it comes to marketing your property, know your target audience. Regardless of your ideal tenant, there are a few simple rules to keep in mind. The first step is taking good photos of the property. Most prospective tenants are looking for their next home on the internet. The goal, here, is to focus their attention on your property. Many agencies offer a professional photography service as part of the rental service. If this isn’ t in your budget, at least stick to the simple rule of good lighting and an uncluttered appearance.
The next step is setting up viewings with prospective tenants. This gives you the opportunity to meet someone face to face, which could provide some helpful insights into whether or not they’ ll be a good tenant. Look out for small things like whether or not they were on time for the viewing, were polite and professional, or asked relevant questions about the property. This could show you whether or not the person is serious about the property and will take care of it.
Once you’ ve selected a tenant, it’ s time to set up the lease agreement. Everyone is in agreement that the lease should be as detailed as possible. This will be your backup should things go wrong in future. Details such as payment date for rent, who’ s responsible for different types of repairs and maintenance, and who pays for utilities like water and electricity, should be included in the lease. The golden rule is to make sure that nothing is left open to interpretation.
The final step in the tenant placing process is handing over the keys to the tenant. At the same time, a thorough property inspection should be done. This is done to protect both the landlord and tenant, since it will highlight any existing problems. This will make the process going forward much smoother, since both parties will know what to expect.
Property management
Beattie explains:“ Once you have placed a quality tenant, your
24 JUNE / JULY 2018 SA Real Estate Investor Magazine