2 June 2016

Ask RiotACT: Managing your own property

| GSD77
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Ask RiotACT

Hello Rioters,

In short, I’m sick of a real estate agent managing my property. Each month I pay them to do practically nothing except take the tenants money, take their cut and other expenses and put the little money remaining in my account.

I had to move in with my carer as I am too unwell to take care of myself and don’t claim any benefits so I rely on the money from the rent and need every spare cent I can get my hands on.

The tenants have just signed a six-month lease as they want to buy at the end of the lease (even though I wanted a 12 month lease, I was pushed into it) and in these six months I want to learn all I can about how to effectively manage my own property.

It also looks like I am going to have to start from scratch and find new tenants too, so I’ll need advice on that also please.

I’m after tips, tricks, links, templates for leases, practically anything to get me started on how to do this. I worked hard for my house and it seems to not be worth it renting it out.

Anyone have any suggestions to get me started and help me out please?

Thank you very much all!

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In my experience it’s about communication and making it as business like as you can without being unapproachable.

Make sure your tenants have an email address for you for run of the mill matters and a phone number for emergencies. Sounds simple but tenants will be used to going through a real estate that ignores them.

Direct deposit for rent, again, sounds simple but it’s the easiest way financially– set up a new account specifically for your rental property rather then your own account.

Rental property insurance is also a must. You may never need to use it but you will be glad that you have it if you ever do!

You may also want to look into trades men etc and do price comparisons so you know who you can call if the property needs maintenance (eg: plumbers, electricians etc)– these are all “services” that a real estate have at their finger tips…

Perhaps if your property has a larger garden it would be worth contracting a gardener to come through the property once a month– while this is a monthly expense, it will save you in the long run if the garden is left looking like a pit at the end of the tenancy.
Get the hot water unit checked out prior to renting the property too.

Lastly, if I can put my two cents in about renters who have pets. Yes, they do create a bit of mess but you will be almost guaranteed a long tenancy if you do allow pets– renters with fuzzy family members will usually stay put because it’s so difficult to find a house that will allow pets.

My 2 cents,

If they don’t have glowing references, or you have any doubt about their rental history, give them a wide berth completely.

Sucker me gave a single mum with three kids a second chance on a rental property in Liverpool. Big Mistake. I got three rental payments in 6 months….nearly got foreclosed on. Never again.

I rented a property through agents for many years. I chose the tenants though, in discussion with the agents. I didn’t let them push a tenant onto me if I didn’t like them…after I learnt from the first mistake anyway. Because my house was at the cheaper end of the rental market many of the applicants were young locals leaving home and looking for their own place. This gave me a chance to do a drive-by of their previous accommodation, to give me an idea of what sort of tenants they might be. Many of the houses were actually their parents’ house and technically they were not responsible for its condition, but it is amazing (or perhaps not) how many children follow after their parents. I learnt this from many years renting spare rooms in my own house. Without fail, every parent I met had similarities to their child. Naturally I didn’t meet them all, especially when their parents were overseas. The neurotic tenant had a neurotic mother, the tidy tenant came from a very tidy and clean house, the messy tenant came from a messy house where housework was more optional, and so on. This might seem like discrimination based on their parents, but it’s your house and if you don’t want holes in the wall, non paid rent, broken windows, etc, this is one way to lower the odds this will happen. The parents who show enough interest and concern to accompany the young prospective tenant (checking out me too) was also a positive indication, but this tended to be just for a room in my house, not a whole rental property.
Get references too, from previous rental agents, and other sources. Check on their income to be sure they can afford the rent. Don’t ring the phone numbers they give you to check references (it could connect to their friend); get the number yourself. I rang one prospective tenant at work on some weak excuse, just to check she actually did work where she said she worked. I went through the switchboard and didn’t use the phone number she supplied.
Although I rented rooms in my house for many years, when I bought a rental property I did use an agent. I didn’t want the hassle. I was the one who took one lot of tenants to the tribunal though, as the agents charged an extra fee for this. I won, as I had photographs taken before the tenants moved in and photographs taken after the tenants moved out, plus documentation. An example, I had a locksmith’s receipt for a few days before the tenants moved in, saying he had replaced a lock and supplied several new keys. The tenants, who had lost all the keys, claimed the lock was broken when they moved in. They had no knowledge of this locksmith visit, and it blew their lies. There were other similar things which blew other of their lies. In the end, after being proved lying several times, I doubt the magistrate believed anything they said, even when my counter evidence was not as good. So take thorough, clear photographs and keep receipts, etc, and get references.

As someone who has been renting through agents in Canberra for 7 years I completely support your decision to get rid of them. I have found most are completely uninterested in doing anything other than collecting the rent and doing inspections. They rarely respond to emails/phone calls and take months to fix issues. But on to your questions!

When the time comes to find new tenants, make sure the rent is reasonable and hold open houses at times people can get to them – this will maximise your applicants. If it’s somewhere people could have pets be sure to state this in the add, I have noticed that pet owners have a lot of difficulty finding rentals and can therefore be very loyal tenants.

Make sure you do a condition report (with photos) before anyone else moves in and lodge the bond (4 weeks rent) with the office of rental bonds. There’s a standard ACT lease available on the web – most agents use it (another way they add no value!).

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