It has long been a smart move to have a “buffer” between the renter and the rental provider. By engaging a professional property manager to find a Renter, collect the rent and promptly manage any maintenance or legislative issues, the opportunity to iron out niggling problems before they become big ones is maximised.

Most importantly, the go-between role played by a property manager means residential property investors keep their relationship with Renters at arm’s length. And without a doubt, this is crucial in today’s renting environment. Most rental providers these days are moving to more regularly increase the rent. At the same time, some renters are becoming assertive in their dealings with property managers and owners.

Owners also face more onerous obligations, such as mandated safety checks of properties,  under revamped Victorian tenancy laws. Added to this, managing the issue of unpaid rent and late payment of rent is becoming a more widespread concern as renters face cost of living pressures. All in all, the deployment of a skilled property manager as a buffer between the owner and the renter can be the dividing line between a successful property investment and an unsatisfactory investment.

Domenic Andronaco, who heads Nelson Alexander’s Property Management team in Melbourne’s North-West, says a buffer allows for good information flow between the rental provider and the Renter, adding that potential problems or issues can be quickly sorted out.

“By using a property manager, it means that everything is documented,” he says. “If there are repairs needed to a property and trades have been organised, I can track what is going on and follow up as needed.” “Repair works all channels through the property manager, and the manager knows what is going on and if work deadlines are being met at any particular time.”

Karen Dellow, a PropTrack senior analyst, says that median advertised rents reached a new high nationally after increasing 2 per cent over the June quarter. “Finding an affordable lease continues to be challenging for Renters, with rents surging across much of the country amid strong demand and limited availability,” Ms Dellow says. “Melbourne’s median asking rent grew 4.3 per cent in the quarter, the largest increase of all the capital cities. It’s now up 11.6 per cent over the past 12 months. “Both house and unit asking prices have increased quarter-on-quarter, up 3.1 per cent and 4.4 per cent respectively.”

PropTrack data shows the negative impact that the Covid pandemic had on rental returns. Weekly unit rents decreased significantly in Melbourne during 2021 and 2022, but they have now recovered, increasing by 17.5 per cent in the past 12 months. Houses are still in high demand, and rents are up 2.7 per cent on the previous quarter and 7.1 per cent year-on-year.

Mr Andronaco says it is getting tougher to manage differing expectations in the rental market as both renters and owners face separate cost pressures. “Rent reviews are a big topic at the moment,” he says. “Many owners want rent reviews because their costs – including land tax and insurance – are going up. They want to claw back some of these costs, so in this environment, it is always good to have that buffer between the renter and the property owner. “You have mandatory safety checks that are occurring under Victoria’s new Residential Tenancies Act. Many owners are spending a lot of money on these checks as well as paying for insurance and land taxes. “Although owners have been passing on a proportion of their higher costs to the renters, it is important to bear in mind that we haven’t had any rent increases until quite recently. Previously, during Covid, there was a freeze on rent increases.” 

He says many owners want rent increases, while some Renters are trying to negotiate for a lower level of rent increase: “So obviously having a real estate agent like Nelson Alexander as a buffer helps the owner and helps the Renter to reach some happy ground. With our deep experience of market trends and demand drivers in specific areas, we can give both groups the right opinions and the right advice. We can give them price comparables for rental properties and demonstrate what is going on in the marketplace of particular areas. We can provide the facts to both renters and owners.”

Mr Andronaco notes that residential tenancy laws in Victoria have changed significantly since he first started in property management 24 years ago. “At Nelson Alexander, we do a lot of training and refresher courses on the Residential Tenancies Act. Professional property managers need to know the ins and outs of the Act when they deal with renters and owners.” He says some owners ask Nelson Alexander property managers to go to the Renter and ask if a certain level of rent increase would put a financial strain on them.

Economic data shows that the vast majority of rental providers in Australia are “Mum and Dad” investors who typically own one investment property, and take an interest in the Renter.  “Many owners know that people are struggling out there,” Mr Andronaco says. “I do call all my renters to tell them that I’ve discussed the lease with the owner and the rent is going up by X amount. We ask if that rent increase would put a burden on them. “It is tough times out there with the cost of living. Some owners understand this and are not increasing the rent. They say, ‘Leave it as it is’.”

Mr Andronaco manages rental properties throughout Melbourne’s North West corridor – including in East Keilor, Airport West Avondale Heights, Niddrie, Hillside and Taylors Lakes. He says one of the major plus factors for owners who engage a professional property manager is the excellent access to qualified tradespeople that this provides. The main trades needed to undertake maintenance on residential property are plumbers, electricians and handymen.

Mr Andronaco strives to have at least three of each of these trade categories on his books for particular areas, so he can get competitive quotes and prompt service. “Having multiple trades available is very important in an emergency,” he says. “If one is not available, you can go to the next. In addition, we ensure that all our tradespeople have all their public liability and other insurance.

“Having reliable and fully insured tradespeople is a very good thing for owners as it protects their property.”

If you would like to discuss having your property professional managed or moved to a new property manager, please contact any Nelson Alexander office.