Leasing Managers - Your Property Leased Quickly But At What Cost

On this episode we delve into the inefficiencies plaguing large property management agencies and reveal how boutique firms can outperform their larger counterparts.

Using a recent leasing success in North Brisbane as a case study, Sam emphasises the importance of treating investment properties as business transactions and making tough calls, such as letting go of underperforming leasing managers. This episode promises to arm you with invaluable insights into effective property investment management and the benefits of choosing a more personalised, boutique approach.

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If you have any questions or scenarios you would like us to discuss on an upcoming episode, please email samantha.eason@exclusivelymanaged.com.au or visit https://www.exclusivelymanaged.com.au/

Transcript

Speaker 1: 0:34

Hello, it's Sam here from Exclusively Managed with Talking Property Management. I haven't been doing any videos or podcasts for quite a while and I'm going to be completely honest, I've been incredibly busy. So we are very fortunate to have had our hands on probably our most amazing project to date, where we were able to pick the colors, the furniture, materials absolutely everything for a property and it turned out absolutely amazingly. It's just been put on our website in our enhancement section, which is probably one of the aspects of what we do that I love so much being able to work with our clients and our investment properties on the renovations, on the renovations, the upgrades. Having that I guess that one-on-one where we go through in our design studio on this is what we want to achieve for your property, whether that's now or later, and choosing those colors, playing with the demographics and then looking at their property on a long-term scale is really, really rewarding. It's finding those properties that haven't had the love and the care that they need and flipping them to a beautiful home that they now don't have to stress with maintenance. That's what we like to do. Maintenance, that's what we like to do. So being able to work on that project is fascinating. It's really interesting seeing how everything plays in together, and we are hoping to get more information on that project soon and more information for you online as well. But I think the overall and the end of it was just fabulous. Like I cannot express how rewarding that was, and we've had a lot of renovations over the last four years that we've been able to work with our clients on, and sometimes the funds just aren't always available for what they want to do. Funds just aren't always available for what they want to do. So being able to find different ways and different materials that are cost effective but also give them the same high end look, that's incredible. We're hopefully working on a couple more this year, and one I'm really waiting for because it's completely out of the norm for us. So once I have more information if that one's going ahead, I just can't wait to share that.

Speaker 1: 3:24

But recently and the main reason for the episode today is I met with Todd Sloan. He's on the Pizza Property podcast. Fabulous, fabulous host, really good podcast. I recommend that you jump to it straight after you're listening to me, of course, but I met with him in May and we discussed a couple of things, but what I was thinking about was when I was listening to the episode today. I completely forgot to make an episode for you guys, my listeners, about one of the things that I mentioned, and it was that there are so many agencies out there that have a leasing manager and I've been speaking with a particular client of mine for a few months now and one of the things that she said was I just get so frustrated because I'm dealing with this leasing manager and then I'm dealing with the property manager and then I'm dealing with someone else, and I know that that is something that frustrates a lot of investors because I hear it a lot. But what I've realized was I've actually never really dwelled and gone down that rabbit hole of the leasing manager with my listeners. So that's what I wanted to do today. The leasing manager's responsibility is to find a tenant as quickly as possible for the client and for the agency. That's it. They don't do the property management, they don't do the routines, they have nothing to do with that tenancy once that leasing manager has found that tenant. And this particular client that was, you know, speaking with me over the last couple of months she was frustrated because her agency took six or eight weeks to find her tenant to begin with, and then she never heard from the leasing manager again, but that's the person that she built that relationship with during that process. Then her tenants broke lease and she had to deal with that leasing agent again. Now they've cut all ties with her because it's gone back to the property manager. And that's something that I said to Todd on our podcast in our episode was I also feel and I've seen it happen in offices. I know it's happening A leasing manager's responsibility is to find a tenant quickly.

Speaker 1: 5:42

I just had a look at a very well-established franchise. They have three leasing managers in their agency and 13 property managers. So let's assume that each of those property managers is, on just an average, 100 properties. I'm going to be very honest with you. It's more likely those property managers are looking after 120 to 150 properties, but 13 property managers in an agency. It either means that they've completely restructured their property management day-to-day, which means that they could have someone who does routines, then they could have someone who does entries, they could have someone who does exits for the whole agency, or those property managers are looking after 100 to 150 worth of properties. That's an agency with 1,300 properties If they have 1, 1300 properties under their management.

Speaker 1: 6:40

I can guarantee you that your property manager does not know the ins and outs of your property because there's just too much going on. That's a hundred percent the same with the leasing manager. If the leasing manager's responsibility is just finding the tenant, how can you be sure that everything else is ticking smoothly? How can you be sure that when that leasing manager is going through the property, that they're looking at things that you could do to achieve a better rent? Or if your property manager is even doing that? And that's just with one agency that I've looked at.

Speaker 1: 7:16

I find it interesting that so many people and investors are still going with your franchise when the boutique agencies have such a better result. And I'll give you an idea we recently leased a three bedroom, two bathroom, well looked after property in North Brisbane for $690 a week, and there are four bedroom, two bathroom properties advertised at $650 in the same suburb. How is it that we are still able to achieve and exclusively such high results when so many other agencies have 100 and 150% more properties that they are unable to achieve similar results? And I'll give you the answer. I'm going to be very blunt. I always am. It's because it's the leasing manager's responsibility to get a tenant in quickly. What these agencies want you to see is hey, we've gotten this result really quick for you. We had 30 people come through the viewing, 16 of them applied. Five of them are fantastic applicants. They're laughing because you're believing everything that they say. You're believing that that is the best rent that you could achieve for your property.

Speaker 1: 8:50

And it's not the amount of times we have clients that go Sam, I have been asked to do a $10, $20 increase. Can you just have a look at our rent and see, you know, at our property, see what the rent is worth? And I go back to them and go try 50. And they'll come back to me and go hey, sam, I'm really happy I got this result and I'm really happy for them because at that moment, that agency that they're with and it's always the big agencies, always I love the small guys. I love the little guys. I love the small businesses because they are the ones who are actively invested in your management. They want to see your investment grow.

Speaker 1: 9:36

Exclusively managed are no different. We built our whole business strategy around our clients' investments growing. That's what we've operated as and that's what our focus is. But these guys, they'll go through and they'll say, yeah, this is a fantastic result. We gave you so many applications to choose from what you should be doing as the property manager is going hey, we had five people show up. One is a good applicant. We're going to have another viewing and see if we can give you another. The reason why is because it's their job to test the market. It's their job to put your property at the height of the market and no one's doing it. Market and no one's doing it. I'm absolutely like flabbergasted that no one has realized they've got so much more potential for their clients' investments. And you wonder why the franchises are having to buy investment properties, buy rent rolls, buy clients properties to manage. Do you know why they buy them? Because they know that their sales agents have a lead. You're just a lead to them.

Speaker 1: 10:49

When you are with a sales agency and property management agency, your investment is not the focus. Your investment is not the focus, it's the sale. They want their sales agents to have a database of 100, 1,000, 2,000, 500 people that they can call every couple of months and check in. Hey, the interest rates. They must really be hurting you.

Speaker 1: 11:15

It's a good time to sell. What do they do? They just go hey, this is what we'll get for your property. A good agency will do exactly what we do. Hey, if you do this, we'll be able to maximize your return. And if you do this, you'll be able to maximize your selling result.

Speaker 1: 11:31

Very few agencies do that, but when you're focused on the limited growth that you can receive, that's all you're going to get, whether it's investment or selling. Those agencies are only going to be giving you the limited advice, and people eat it up. They love it. They bloody love it. And I wonder why? Because it's easy One. They've made you feel like selling with them is easy. And is it Because you would want someone who goes out of their way to get you the best price possible? The leasing agent isn't going to get you the best price possible. They're going to get you a tenant as quickly as they can. But is it at the best price? Nine times out of 10, it's not.

Speaker 1: 12:26

I'm going to be very frank and blunt with you. The leasing agent doesn't care who they put in the sales agent. They just care about the commission. They don't care how much you sell it for. If they've got five, 10 listings, they're going to go guns blazing and getting them all sold as quickly as possible. The reason why they care about their commission they don't care about you and your family and how much that extra $40,000 or $80,000 could work for your family if they work a little bit harder or negotiate a little bit harder. They care about getting it done quick, and that's what I wanted to discuss with you.

Speaker 1: 13:12

And it caught me by surprise that I've been so focused on our wonderful projects and how amazing you know the industry is and all the changes with legislation and even though some are, you know they're questionable that have been happening, but why I haven't come on here to express leasing managers. And I would be really pleasantly surprised if you reach out and you tell me that you had a fantastic result, because, as I always say, if you've got a fantastic property manager, you stay with your property manager. They're actively working for you, they're getting you the best price, they're getting you a great result. I'm going to tell you to stay with them. They're incredibly rare to find, but if you are still with a franchise and you're still limiting your investment, I can't really say too much. You know you've got to step out of your comfort zone and you've got to move on. And no matter what I say on our podcast, you're not going to change, but I hope that it it's in and it's focused and it's and it's being absorbed.

Speaker 1: 14:37

It's not perfect for any investment strategy. You've got to do what's best for your investment. It's a business transaction and unfortunately, sometimes in business you got to get sacked. You're not performing, you're not working out. That's just the way it is not working out. That's just the way it is. And if that's one bit of advice that I can handle you as someone with an investment property myself, you need to cut all emotional ties to that property and that includes the team players that are involved. But let me know what you think. If you've had a fantastic result with a leasing manager, if you've experienced exactly as I've mentioned, or maybe you've sold a property with a franchise before, but then the next time you sold the second one or the third, you went with someone smaller, not as busy, did you achieve a better result? That's what I want to know. Achieve a better result? That's what I want to know. Thank you for listening to our very quick episode on talking property management with Samantha Eason.