Owning an investment property sounds simple, until it isn’t. There’s the tenant selection process, rent to collect, maintenance to organise, strict rules to follow, and tenants to manage, sometimes all in the same week. It’s a responsibility that may seem straightforward on paper, but can quickly unravel without the right systems in place and an experienced property manager in charge.

That’s why having a skilled property manager on your side makes all the difference. A good property manager helps protect your asset, keeps your income steady, and steps in as the advisor and middleman when things get complicated.

If you’re new to investing or simply tired of doing it all yourself, you probably have a list of questions swirling in your head. This practical, no-fluff guide covers everything, from the cost of hiring a property manager to how to screen tenants and handle disputes.

Understanding Property Management Roles and Responsibilities

What are the Main Responsibilities of a Property Manager?

A property manager is responsible for the day-to-day running of a rental property. Their role is to ensure the investment performs well by handling everything from rent collection and maintenance to compliance, while ensuring both landlord and tenant are well taken care of.

Their role typically includes:

Advertising and Leasing – Creating listings, hosting inspections, and preparing lease agreements.
Tenant Selection – Screening applicants to find reliable, respectful tenants.
Rent Collection – Ensuring rent is paid on time and chasing arrears if needed.
Routine inspections – Regularly inspecting the property and reporting back to the owner.
Maintenance and Repairs – Organising urgent and preventative maintenance to protect the property’s value.
Compliance – Ensuring the property is compliant, such as smoke alarm, gas and electricity testing, pool safety checks, and tenancy agreements.
Dispute Resolution – Stepping in when problems arise to ensure interactions remain civil, professional and in accordance with the Residential Tenancy Act.

What is the Difference Between a Property Manager and a Selling Agent?

While both operate within the property industry, their roles are very different. A selling agent helps property owners put their home on the market and achieve the best possible sale price. Their work revolves around preparing and marketing listings, managing buyer interest, conducting inspections, and negotiating sales. Once the property settles, their job is complete.

A property manager, on the other hand, steps in after the sale to handle the long-term rental management of the property. Their role continues month after month, covering tenant management, maintenance, and financial reporting.

Here’s the easiest way to think about it:

Selling agents are transactional. Their goal is to close the sale.
Property managers are relational. Their job is to maintain a smooth tenancy.

Most agencies offer both services, but it’s rare for one person to do both jobs.

How Do Property Managers Screen and Select Tenants?

Tenant selection is one of the most important parts of managing a rental property, and it’s rarely as simple as just picking the person who applied first. Property managers follow a structured process to reduce risk and find someone likely to pay on time, look after the place, and stay long enough to make it worthwhile.

Here’s how that usually plays out:

Application Review – Each applicant submits identification, proof of income, rental history, and references. Gaps in the paperwork or vague answers are treated with caution.
Rental History Checks: Previous property managers or landlords are contacted to confirm the outcome of the tenancy. Things like late payments, bond disputes, or unexpected vacates are looked at closely.
Employment and Income Verification – Payslips, contracts, or direct contact with the employer confirm stable income. The rent amount is assessed against their income to ensure affordability, typically under 30–35% of net earnings.
Database Screening – National tenancy databases like the Tenancy Information Centre Australasia (TICA) and the National Tenancy Database (NTD) are searched to find if the applicant has been blacklisted for rental arrears, lease breaches, or tribunal orders. Any red flags here are treated with caution.
Credit Checks – In select cases, a credit history report may be obtained to assess broader financial responsibility, particularly if the applicant is self-employed or has limited rental history.
General Conduct – Communication, punctuality, and behaviour during inspections all factor into the decision. Sometimes it’s not just what’s on paper, but how the person carries themselves throughout the process.

Communication, Maintenance, and Tenant Relations

How Do Property Managers Deal with Tenancy Issues, Disputes, and Evictions?

Even with the best-managed properties, issues can arise. Rent can fall behind, rules can be broken, or misunderstandings can turn into full-blown disputes. That’s where a property manager steps in to take the emotion out of the situation and steer things back on track.

Here’s how tenant issues are typically handled:

Start with a conversation – Most issues begin with a phone call or email. If a tenant is late with rent or something has gone wrong, a direct, professional chat can often resolve the issue early. Calm communication is essential.

Issue a formal notice – If the problem remains unresolved, the manager may issue a Notice of Breach of Duty to the Renter, giving the tenant 14 days to rectify the issue or pay compensation. If that fails, it can escalate to a Notice to Vacate or a VCAT tribunal hearing, depending on the breach.

Apply to VCAT – If the tenant doesn’t comply, the manager can apply for a hearing at the Victorian Civil and Administrative Tribunal. VCAT can issue payment orders, possession orders, or set a date for the tenant to vacate.

Eviction (as a last resort) – If VCAT grants a possession order, the manager can request a warrant of possession. Only police (not landlords or agents) can carry out an eviction.

Every step, including emails, phone calls, inspection notes, and photos, is documented. If the issue reaches VCAT, this evidence becomes crucial. Throughout it all, the aim is to remain impartial and professional, resolving the issue with minimal disruption, while staying compliant with the Residential Tenancies Act 1997 (VIC).

Costs and Fees

How Much Does It Cost to Hire a Property Manager, and What’s Included in the Fees?

Property management fees vary depending on the agency, the type of property, and the services required, but in most cases, the costs are structured as a percentage of the weekly rent, along with a number of fixed fees.

Here’s a breakdown of the common charges you can expect:

Management fee – Typically ranging from 5% to7%, plus GST, of the weekly rent. This covers the day-to-day running of the property: tenant communication, maintenance coordination, inspections, and rent collection.
Letting or leasing fee – Typically equivalent to one or two weeks’ rent, plus GST, when a new tenant is signed. This covers advertising, open for inspections, tenant screening, and lease preparation.
Advertising costs – Sometimes charged separately if listings are boosted or upgraded on real estate platforms.
Lease renewal fee – A smaller fee (often $100–300 plus GST) when an existing tenant signs a new fixed-term lease.
Routine inspection reports – Usually included, but some agencies may charge extra if additional inspections are requested.
End-of-tenancy management – Organising bond claims, final inspections, and re-letting the property.

It’s worth remembering that while the fees might feel like an added expense, a good property manager more than pays for themselves by preventing problems, avoiding high vacancy rates and extended vacancies, and protecting the property’s value.

What Percentage of Rent Do Property Managers Take? How Is This Calculated?

Property management fees are almost always calculated as a percentage of the rent collected. In Victoria, the standard range sits between 5% and 7%, plus GST, depending on the agency and the level of service included.

For example, if a property is rented at $500 per week, and the agency charges 7%, excluding GST, then:

$35 per week (or roughly $152 a month) is deducted as the management fee
The remaining amount is transferred to the landlord

It’s important to clarify:

This fee is calculated only on rent actually received, not advertised rent or potential rent.
If a tenant misses a payment, no fee is charged for that missed amount.
GST may be added on top, depending on the agency’s pricing structure.

While it might be tempting to go for the cheapest option, lower fees often mean reduced service. Agencies charging under 5% may cut corners—fewer inspections, delayed maintenance, or inexperienced staff. On the flip side, some boutique or highly experienced agencies may charge slightly more but deliver stronger returns, shorter vacancy periods, and better-quality tenants.

Benefits and Considerations

What Are the Main Benefits of Hiring a Property Manager?

Owning a rental property can be a smart investment, but managing it isn’t always straightforward. Between changing legislation, late-night repair calls, and finding the right tenants, it can become a full-time job. That’s why a good property manager is invaluable.

Here’s what a property manager brings to the table:

Expertise in legislation – Tenancy laws change often, and staying compliant can be a headache. Property managers are trained to keep up to date, so landlords don’t have to.
Time-saving – From inspections to lease renewals and maintenance calls, they handle the admin, so landlords can focus on other priorities.
Tenant screening – Experienced managers know how to spot red flags early and secure quality, long-term tenants.
Maintenance management – They coordinate trades, monitor costs, and ensure repairs are done properly, without the landlord having to chase anyone.
Rental optimisation – They keep an eye on market trends and adjust rents when due to ensure consistent returns.

It also adds a layer of emotional distance. When issues arise, the property manager steps in with a clear head, ensuring decisions are practical, not reactive.

What Are the Risks of Managing a Rental Property Without Professional Help?

Self-managing a rental might seem like a good way to save money, but it comes with risks that many landlords don’t fully anticipate until they’re knee-deep in a problem. Like a good insurance policy, you don’t always appreciate it until you need it.

Without professional support, landlords take on full responsibility for:

Legal compliance – Missing a change in tenancy laws, safety standards, or notice periods can result in costly fines or tribunal losses.
Tenant disputes – From late rent to property damage, handling issues without formal processes can escalate tension and expose landlords to risk.
Vacancy management – Inexperienced owners may struggle to market the property effectively, leading to longer vacancy periods and lost income.
Repair delays – Not having a network of reliable, reasonably priced trades can mean either overpaying or risking shoddy work.
Record keeping – Failing to document communications or inspections properly can become a liability if a dispute ends up at a tribunal.

And then there’s the added pressure. Tenants can contact the landlord directly at odd hours, expect flexibility on rent, or push boundaries that are hard to enforce without a neutral third party. For most people, the risks and time involved in self-managing a property usually outweigh any potential savings.

Choosing a Property Manager

What Should You Consider Before Hiring a Property Manager? And What Questions Should You Ask Before Hiring?

Not all property managers operate at the same level, and choosing the wrong one can cost more than it saves. Before signing on the dotted line, it’s worth digging a little deeper to find someone who genuinely knows the local market and prioritises your best interests.

Key things to consider:

Local knowledge – Are they experienced in your suburb or property type? Local insight matters when it comes to pricing, tenant demand, and trades.
Portfolio size – How many properties does each manager look after? Too many, and they may not have the bandwidth to give yours proper attention.
Communication style – Do they keep landlords informed regularly? Will you get direct contact, or be bounced between different staff?
Fee structure – Make sure fees are transparent. Ask what’s included, what’s extra, and whether they’ll still charge during vacancies.
Track record – Check their online reviews and ask for references. Long-term clients and low vacancy rates are usually a good sign.
Tenure – How long have they worked at their current agency? How many roles have they had in the last two years? Check their LinkedIn profile for this information, as you don’t want a revolving door of property managers that comes with the larger agencies.

And here are some smart questions to ask:

How many properties do you personally manage?
How often do you conduct routine inspections?
What’s your process for selecting tenants?
How do you handle disputes or arrears?
Can I see an example of your monthly owner reports?

A property manager is a long-term partner in your investment. Taking the time to ask the right questions now can prevent a lot of regret later.

A Property Manager Who Treats Your Investment Like Their Own

Independent Property Broker offers expert, hands-on property management services across Melbourne. No fuss, no cut corners, just reliable service and clear communication. Whether you own a single property or a growing portfolio, we’ll ensure everything runs smoothly, with one dedicated property manager – a Director of the business, not just an employee – building a long-term relationship with you for years to come.

Get in touch today to find out how we can help manage your property with care, confidence and peace of mind.

Everything You Need To Know About Property Management