There are some situations where getting a new tenant is the best thing for you from a financial and time perspective - but other times, even if they're not perfect, you should hang on to them. How do you tell the difference?
Blogger: Lisa Indge, managing director, Let's Rent
It is your property manager’s role to advise when this is the appropriate action to take, but here are a few scenarios to consider.
You don’t like your tenant.
In fact he or she just irritates you every time they request a repair as it’s usually something minor they could manage with for a while.
They pay their rent on time every month, keep the place very clean and it looks fabulous. They’re even paying good rent.
Keep them! You may not like them but they are by definition good tenants. We find that personalities can clash from a distance when you have a landlord who is not a details person and a tenant who is. This is not a reason to move them on.
Your tenant is constantly late with their rent but eventually pays a few weeks late.
They don’t take great care of the property and certainly don’t report repairs as they don’t even notice when the roof has leaked.
Goodbye. Your property manager should be recommending strategies to move this tenant along. In New South Wales, legislation allows for you to take the tenant to tribunal to insist on prompt payment of rent and if this is not adhered to, a termination can be processed.
Your property is a bit run down.
In fact, it is in dire need of a full renovation. The tenants pay their rent on time every month and don’t complain about repairs too much, just the necessary ones to keep your property maintained.They are messy– really messy – but they are paying good rent.
When you inspect the property you are put off by the amount of belongings they have and how untidy it is. It’s fairly clean, not enough that you would be happy to join them for dinner, but passable.
If they are not causing damage to your property and reletting it in the condition it’s in would be a problem, then I suggest you leave them in place paying good rent until you are ready to do some work.
Plan the timing of the renovation so that you know how long you should be resigning them for. Save and make sure you get quotes for a new kitchen, bathroom, paint, carpet, so you are prepared.
You have a long-term tenant who has been in your property for years and is now paying sub-market rent for one of two reasons: Either you like them and don’t want to upset them by putting the rent up, even though your property manager has been recommending it.
Or, the tenant threatens to move out every time a rent increase is suggested, so the increase is reduced or not put through at all.
Is this an investment or a charity? I’m sure as a landlord you have saved to purchase it and made sacrifices. As such, you should be receiving close to market rent.
Have your property manager explain that you need to receive a reasonable rent and it will be increasedto X amount with the appropriate notice. And if they decide to leave, then find a new tenant atmarket rent.
Remember, an investment property should provide cash flow without constant headaches.
About the Blogger
A combination of property and financial experience that spans more than twelve years ensures that Lisa is well equipped to manage your investment.
Lisa has a particular talent for negotiating deals in tricky situations and focuses on achieving great results for every single client. Her patient but decisive manner means she enjoys working with both owners and tenants and is happy to help resolve any issue.
She offers constructive and accurate advice to her clients and always follows up any queries.
As the Managing Director of the business, Lisa also concentrates on business planning and development for the company. She is always looking at industry innovation in order to keep Let’s Rent at the forefront of the property management sector.