How to choose the correct managing agent for your scheme

Choosing a managing agent for your scheme can often be a difficult task. Not only do you want to find a manager or management firm that can promptly and effectively deal with any issues that may arise, but you also want their services to be as good and as affordable as possible.

Whether you’re searching for a manager for a new building or development or your current manager’s contract is up for renewal, consider these points before making your decision.

What does a good managing agent do?

A managing agent plays a vital role in ensuring that yours is a safe and successful community scheme providing a good living environment for residents and a good investment vehicle. A scheme manager is employed by the body corporate of a sectional title scheme and acts on its behalf.

There are many legal requirements that a managing agent must meet. A good property manager or management company will ensure that the association has the proper insurance policies in place, hires cleaners, gardeners and other workmen to ensure the property is properly maintained and ensures that common areas such as pools and driveways are maintained to a standard that supports the value of the individual properties.

Managing agents can also be called upon to act as mediators in disputes with and between owners, promoting fair solutions for any issues based on sound legal principles.

Make sure to keep the following factors in mind when comparing managing agents options and what they can offer:

What is a good price to pay for a managing agent?

You usually get the standard of service that you pay for. If a community scheme management firm charges a fee that sounds too good to be true, it probably is. At the same time, you should make sure that you’re only paying for services that you actually want and not for any that you don’t need. However, while price is undoubtedly an important factor, it certainly shouldn’t be the only issue you consider. Look carefully at the person or company’s approach to financial reporting. Don’t hire anyone who is doing your accounts without the support of a computerised system. How often will you receive updates on the financial management of the scheme, and in how much detail will they explain where the scheme’s money is being spent?

The location of a managing agency is important.

It’s important to choose a local managing agent. Not only will local service suppliers have an in-depth understanding of the unique risks facing schemes in your area and province, but they will also have useful contacts with local service providers and tradespeople who can maintain your building. When problems arise, as they always do, a local portfolio manager will be able to make sure they are sorted out more quickly than a one based in another city or in a distant suburb.

What qualifications or experience should a managing agent have?

Does the portfolio manager have the necessary professional qualifications? Do they have UCT qualifications in scheme management or in how to start and manage a managing agency? Are they a member of NAMA? If they collect or receive contributions from a sectional title scheme, are they a member of the EAAB and do they have the professional indemnity insurance cover required under the Community Schemes Ombud Service Act? You should also consider what experience a manager or portfolio manager has, how many other developments similar to yours they manage, and whether they can demonstrate suitable knowledge of the relevant legislation.

List your expectations.

It’s important to list what you want your managing agent to do and detail which of the scheme executives’ responsibilities will be delegated to him or her. Consider the scheme’s insurance obligations, maintenance tasks, and secretarial duties. Are there any other specific duties that need to be attended to? Make sure that any manager you consider is aware of your expectations and has the capabilities to meet them.

Recommendations and references.

A recommendation from someone you trust in a similar scheme is much more valuable than a marketing presentation. Talk to friends and family who act as executives of other schemes and see whether they can recommend any particular companies. A property manager’s references can give you insight into the standard of service they can actually offer in practice. Ask anyone you are considering to provide references from other schemes they manage, and contact those references – talk to real people and ask for detailed information.

Communication is key.

Last but not least, don’t forget the importance of communication. You want a managing agent who keeps the trustees in the loop at all times and who can communicate promptly and clearly at all times, so make sure these are qualities you look for and that your contract sets out the detail of appropriate service levels.

If you have any queries in this regard, please e-mail Levytate Managing Agents at info@levytate.co.za.