The more properties you own, the greater the management headache. However, it needn’t be a huge task to properly manage a growing property portfolio, as discussed in this video.
VIDEO TRANSCRIPT
Hi. In today’s video I just want to give you a few quick tips that might help you as you are building your property portfolio around managing your properties. So, the first tip’s probably the big overarching one is make sure you treat this like a business. And the first thing to do to get that right is to make sure you’ve got the right team around you. When you talk about managing properties then one of the key things to get right is actually the property management. So even for the properties I own that are close to where I live, I always engage professional property managers to oversee those on a day to day basis for me because it just doesn’t make economical sense for me to self manage those things. But the second one is, even though you’ve outsourced that particular part of it, you know, you haven’t really outsourced responsibility. So what you’re looking to do is make sure you stay on top of it so every month, it only takes around, sort of five to ten minutes per property, what I like to do is, as soon as the property statement comes in, I just go line by line through it, so when I see how much is coming in from a rental I just sense check that and make sure it stacks up with what I am expecting. And then for each of the expenses, I just literally go line by line and I physically tick it off. By doing so, on occasion you might find some things that are out of whack. The biggest example I had, I was owed $880, that didn’t hit my bank account. It was an honest mistake on behalf of the property manager but if I didn’t do that then I’d be out over $800. So what I do is, once I’ve gone all the way through that, then I actually check that all the way back to the bank account. So it’s one thing to see it on a statement, say okay, I’ve got my rent in, I’ve paid a few expenses down here, here’s a management fee I’m left with $600 or whatever. It’s another thing to actually then tick that back and go okay that’s hit my bank account, I can park that for another month and move on. So I always make sure I do that every month for all the properties that I do own. If anything looks out of whack then you know follow up straight away and get on top of it, but don’t wait or leave that until the end of the year. Speaking of end of the year, what I do like to do though is, for each and every property again go back and do a sense check. So you get your sort of property statement on a yearly basis and just make sure it all stacks up, so if it’s a strata building for example, then you want to make sure that you’ve actually got four times if it’s quarterly payment. The same for any utilities and stuff like that you pay. And that what you’ve got in rent stacks up with what you’re expecting, so that’s just another sense check. When I’m at yearly, I always like to obviously speak to my accountant, review how things have gone, just make sure we’re still on track with plans. It’s also a good time to speak to your mortgage broker just make sure that what you’re paying on your interest rates is still within the market, and if not is it worth looking at revising those things going forward. Look managing a property portfolio needn’t be the biggest thing in the world. A lot of the hardest stuff is actually researching the property, finding it, and getting that process down. Once you’ve actually purchased it, as long as you’ve purchased well, and you’ve got a professional managing it for you, it shouldn’t take you that long on a monthly basis. But certainly treat it like a business, make sure you stay on top of things, and it will reward you in the end. Hope that helps.
