Traps to managing a rental property

Long-term landlords will tell you that a good Property Manager is worth their weight in gold

“Surely it can’t be that complicated?” asked a potential landlord who was considering using a Property Management Service.

Having decided to rent out their property themselves, it wasn’t long before they returned to the Property Management Team to help them get their investment back on track.

In the land of Utopia, renting out property seems straightforward, with every tenant paying their rent on time. The thought of a troublesome tenant is a myth.

Having managed numerous rental properties over the years, our Property Management Team can tell you that the land of Utopia does not exist, and that every cent spent on having a property professionally managed can mean the difference between your investment making a profit or loss.

If you don’t believe me, let’s have a look at three traps do-it-yourself landlords have problems with when it comes to managing tenants:

Firstly, failing to ask for a bond

This is a security deposit held in case the tenant doesn’t meet their obligations in maintaining your property to a reasonable standard, or damages the property.

Like the saying, “You can’t judge a book by its cover,” it can be very easy to misjudge tenants. Often it is found that those who many would consider to be tenants of outstanding character, leave rental properties in a state that resembles the inside of a garbage truck.

Unfortunately, you just can’t tell who will stick by the rules, and who won’t. At least when you have a rental bond in place, when the tenant leaves you have the security of four weeks rent to offset any liabilities created by a tenant.

Secondly, not having a lease

This is a legally enforceable contract which spells out all the terms both the landlord and tenant have agreed to. It is a safe-guard for both the landlord and the tenant.

Without this type of contract, if anything goes wrong and the tenant disputes the claim, it is the landlord’s word against the tenant as to what was agreed upon when entering the tenancy.

The absence of a Tenancy Agreement leaves a landlord open to potentially going down the road of litigation and an expensive solicitors bill, in trying to rectify the problems caused by the misunderstanding between landlord and tenant.

Thirdly, interpretation of Tenancy Laws

Each State is governed by its own Property Management Laws and can change without notice from time to time.

With a proper professional Property Manager on the case, they are always up to date with changes in legislation and how they apply to both tenants and landlords alike.

However if you decide to manage your own property, by the time you can find out changes to legislation it can mean facing fines or penalties simply because you did not act quick enough to make changes.

These three traps are just a few things that need consideration before self-managing a rental property.

If you speak to long-term landlords who own a number of properties, they will tell you that a good Property Manager is worth their weight in gold, freeing them up to enjoy the benefits of their investment without the day-to-day hassles.

To discuss your options when it comes to managing your rental property please give our Property Management Team a call on 4441 6033 or 4443 3222, as they are available to help you make the most of your investment.