When a Client of an investment property appoints an agent to act on their behalf, that is exactly what the agent does, act on behalf of the Client!
Clients that purchase investment properties are 9 out of 10 times emotionally detached from their investment. It was purchased for either negative or positive gearing, a part of their superannuation plan or simply to hold and pass to their children.
Clients who are converting their home over to an investment because they have purchased a new family home are more vested in their rental property. In other words, more emotionally involved.
However, in some instances the Client is so heavily involved that they interfere with the management of the rental property. They start telling the agent how to do their job. For example, the Client has to view the photos of the property prior to listing it for rent or has to write the description or they want to see every email that you send the tenant and the tenants reply or they demand when the entry condition report should be done (outside normal working hours and at a cost to the agent due to overtime rates).
The Form 6 (Appointment to Act) signed by both the Client and their Agent, has certain conditions under which both parties must act reasonably.
Section 4 – Clients Obligations – subsection 4.2 – “The Client must not let or manage the property as principal, or appoint any person to let or manage the property other than the Agent for the term of this Agreement” . So in short, and very clearly the Client is in breach of this agreement when they start to interfere with the Agents responsibilities telling them what photos to use or writing the ad or demanding that entry condition report must be done in their time frame or expecting to see the communication between the Agent and the tenant. Is this not “micro managing”?
We recently had an issue with a Client behaving like this. The appointment was terminated immediately by mutual agreement. And like all business owners I felt that I should look over the situation that had transpired to see if I could improve on my reaction to an owner mirco managing me.
What I understand now from this situation is that it is a definite “NO! NO!” to have two people doing the same job ie: Client and Agent. Boundaries are crossed, stretched and in some cases completely destroyed.
During my time of reflection on this matter I had a look at the property on a real property data base and discovered that the Client had had 3 managing agents in two years. What does this tell me? The Agents were having trouble managing a difficult client. To have 3 agents in a 2 year period is absurd. Mirco-managing Clients need to be self managing clients because no Agent is ever going to please them.
rental trends 