The guiding legislation around residential property management is primarily the Residential Tenancies Act 1986. But that’s not the only legislation landlords need to be aware of when it comes to renting out their properties. The likes of the Human Rights Act 1993 and more recently the Health and Safety at Work Regulations 2016, along with others, also come into play. The Health and Safety at Work Regulations place a legal onus on “Persons conducting a business or undertaking” (and yes that includes landlords) to ensure as far as is reasonably practicable the property doesn’t pose a risk to the health and safety of any person. Remember, ignorance of the law is no excuse and breaches can result in eye watering fines.

Landlords need to be familiar with relevant legislation. They need to realise that renting a property is a business and guessing their way through the process is not an option.

So, what are the options available to landlords? Well there is absolutely nothing to stop them from doing it themselves if they have the time and knowledge. That means being well versed in all of their legal obligations. They also need to ensure that they use the correct forms and documents and have good processes in place. Alternatively, private landlords can opt out of doing it themselves and rely on the expertise of one of the many property management companies operating throughout New Zealand.

If they choose this option they will be spoiled for choice because there are certainly a lot of property managers out there vying for landlord’s business. Of course, not all property managers are created equal. You don’t have to look too hard to find stories about property managers behaving badly. Thankfully, they are the exception rather than the rule, but all the same you don’t want to get stuck with a bad property manager – so here are some suggestions to help you avoid that happening.

Look For Good Reviews

Firstly, let your fingers do the walking and search online for property managers operating in your area, and then look at their online reviews. Check out their websites and have a look at the properties they have advertised for rent. Do they seem to be involved in renting the sort of property you have, or are the properties they have for rent completely different? Once you have a short list of possible property managers search the Tenancy Tribunal for hearings they have been involved in and the outcomes (https:// forms.justice.govt.nz/search/TT/). Be cautious of property managers who have been taken to the Tribunal on more than one or two occasions by tenants and lost.

Another consideration is whether the property management business is owneroperated or part of a larger organisation, like a real estate company, for example. It’s my experience that owner-operated businesses have more “skin in the game” so they may work harder to resolve issues.

Ask The Big Questions

Speak to the property managers you have short-listed. Ask them about their business model, their processes and their fees. Some property managers offer a low management fee in order to attract new business. Be wary of this as often the devil is in the detail and additional fees will be charged for what other managers may include in their base fee. Not the most expensive nor the cheapest is generally a sensible rule of thumb. A lot of companies advertise “zero tolerance with rent arrears”. Ask what they mean by that? The reality is that property managers have very little control over whether a tenant (for whatever reason) pays their rent on time, so telling you they have zero tolerance means nothing. It’s how the property manager deals with rent arrears that really counts. At Propertyscouts we have very clear and defined processes for everything, but especially around rent arrears. We were one of the first (if not the first) companies in New Zealand to offer landlords a rental guarantee and free Tenancy Tribunal attendance. In that regard we can offer landlords real peace of mind when it comes to rent arrears, which a lot of our landlords really like.

In my next column I’ll deal with the Tenancy Tribunal process and how to prepare for a hearing to give yourself the best chance of a successful outcome.

Milton has been involved in property management since 2014. In 2015 he franchised his very successful Dunedin property management business and now has 14 franchises operating throughout New Zealand. He is a strong advocate for industry regulation and is presently a committee member of the Property Managers Institute of New Zealand.