Tenants

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When looking for a new house to lease, most renters will spend several weeks, if not months, searching for properties online and inspecting them in person.
This time spent researching makes renters very discerning as to what makes a desirable property and there are certain features they will actively seek out.
In addition to these sought-after features, Shane Goldfarb, who recent helped establish the new McGrath agency after years at Hodges St Kilda, says there are some simple tips landlords should be aware of in order to increase the desirability of their rental property, not to mention the quality of tenants and potentially the rent price. His ten tips landlords should know in order to make your rental property more appealing.
 1.      TENANT FRIENDLY, NOT INVESTOR FRIENDLY
It’s important as a landlord to remember that your target audience is renters. While an investor might be interested in certain features, your aim is to appeal to tenants, who typically want somewhere that is comfortable, low-maintenance and good value for money.
 2.      PROFESSIONAL PHOTOGRAPHY
Investing in professional photography rather than taking your own photos of your property will instantly increase its desirability. When renters are researching dozens of properties online, properties with clear, professional photos will always catch the eye first and give renters the impression that the property, like the photos, is of a high quality. Also, these photos can be reused, creating greater return on the small investment required.
 3.      PRESENTATION
It may seem like stating the obvious, but presentation matters. Simple measures come inspection time, such as ensuring the house has been freshly cleaned, including carpets steam cleaned if necessary, will help to ensure your property is leased quickly. 
 4.      QUALITY FITTINGS AND FIXTURES 
A discerning renter, the type you should most want to attract, will be more likely to apply for property that has high quality fittings and fixtures such as stainless steel in the kitchen and bathrooms.
 5.      FRESHLY PAINTED
It should never be underestimated what a fresh coat of pain can do for a property, particularly one that is maybe on the old and tired side. Stick to neutral, timeless colours like whites and creams to ensure they will be compatible to all tenants tastes and not require regular repainting over the years.
 6.      AIR CONDITIONING
For many tenants central air conditioning is considered a crucial feature and can be the deciding factor between two very similar properties. 
Whilst installing air conditioning might seem like a significant investment at the time, a quality unit should last many years, making the initial outlay worthwhile when compared with years of consistent rental income.
 7.      DISHWASHER
Similar to central air conditioning, a dishwasher is increasingly considered a must-have amenity. Likewise with central air conditioning, the initial investment will be offset by the premium prices that can be charged for having this feature.
 8.      OUTDOOR AREA
Simple improvements to the outdoor area, whether it be a backyard or courtyard, can make a world of difference. A functional outdoor area acts as an additional room and entertaining space.  If previous tenants have consistently failed to maintain the garden or lawn, it could be worth neatly paving the space to ensure it stays presentable and functional.
 9.      QUALITY COMMUNAL AREAS
When leasing a property that has shared facilities, ensure that the owners corporation are on top of cleaning, gardening and maintenance of communal areas. These areas are extensions of your property and a tenant may choose an alternate property or choose to move if the owners corporation do not keep the areas clean and well maintained.
 10.  ENGAGING A GOOD AGENT
The advice and professionalism of a quality property manager can be invaluable. If you are time poor or unsure what to look for in a tenant or how the leasing process works, do your research and engage in a reputable property manager. They will ensure you have reliable tenants that maintain your property and increase your chances of consistent rental income. 
 
For more from Shane Goldfarb, <a href="https://www.mcgrath.com.au/agent/4490-shane-goldfarb" target="_blank">click</a><a href="https://www.mcgrath.com.au/agent/4490-shane-goldfarb" target="_blank"> here</a>.
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Property 101: 10 tips to make your rental property more appealing

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GUEST OBSERVER
An increasing number of landlords are requesting agents take over the management of their rental properties after experiences with tenants who default on rent or who damage their property.
Our member agents are reporting many instances where they are inheriting properties with requests from the owners to evict tenants or to chase up unpaid rent.
Privately managed properties are targeted by bad tenants because they know the landlord does not have access to the checks and balances available to a professional property manager.
Good agents pay for access to the national defaulting tenant databases whereby they can check to see if there is any negative activity recorded against an applicant’s name anywhere in Australia.
It is not unusual for an immaculately presented applicant who looks to be a perfect tenant to owe thousands of dollars in rent or to have damaged a property in another state.
Many of these people are serial defaulters and once they are in a property it is difficult to move them without loss and aggravation.
Another advantage of professional management is that it provides a firm, friendly barrier between owner and tenant. 
It must be said that the grater majority of tenants are wonderful people who look after their rental property and pay their rent on time every time however there do exist a percentage of bad tenants and landlords are well advised to seek professional management to minimise the risks.
 
Geoff Baldwin is chairman of the  Certified Practicing Real Estate Agents and can be contacted <a href="https://www.cprea.com.au/" target="_blank">here</a>. 
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Bad tenants target self-managed rentals: Geoff Baldwin

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Complying with your legal obligations is crucial, regardless of whether you use a property manager or self manage your properties.
With this in mind, we're sharing 10 'must know' things from the Residential Tenancies Act in New South Wales and encouraging you to provide your own. Next week, we'll tackle Victoria.
<ol>
<li>
That the following terms are not allowed in your agreement:  - A requirement for the tenant to have the carpet professionally cleaned, or to pay for the cost of this service, at the end of the tenancy. - This may not apply if the tenant has pets. That the tenant needs any sort of specific insurance.  - That any rebate may occur if the tenant does not breach the agreement, and, on the other hand, that a tenant is liable to pay all the remaining rent, increased rent or a penalty if they breach the agreement. 
</li>
<li>
Your tenant has anti-discrimination rights.   While this can be a broad topic, you must not discriminate against tenants on the basis of your tenant's race, religion, sexual oritenation, age or any disabilities. Discrimination can be seen as broad, and may include undertaking extra inspections due to a tenant's age. 
</li>
<li>Pet bonds are not allowed. </li>
<li>
You do not have to allow sub-letting.  If a tenant is sub-letting without your consent, that is having another resident in the house pay rent to themselves, this is against the agreement. 
</li>
<li>
Tenants must be provided 60 days of written notice for a rent increase.   When 'written notice' is mentioned, you must allow time for postage if this is your intended method. It is recommended that landlords and property managers keep clear records of when notices have been sent, to avoid a breach. 
</li>
<li>
The property must be in a reasonable state of cleanliness, and it must be habitable, when provided to the tenant.   While this is a debatable point, it's largely worth remembering the state of a property you would be happy to inhabit, and emulate this. Remember to focus on making the property compliant, safe and clean. 
</li>
<li>
Tenants are required to report the need for repairs and maintenance.  They must also not make material additions or changes, such as the alteration of locks or security devices, or fly screens, without the consent of the landlord. 
</li>
<li>
There is a limit on the amount of bond you can charge a tenant. In New South Wales, this limit is up to four week's of the rent you have agreed to pay. As a landlord or property manager, a bond lodgement form is required to be provided to the tenant. 
</li>
<li>
A landlord must tell tenants 'material facts'.   These material facts include whether the home has been subject to serious flooding or bushfire in the past five years, if there are any health/safety risks or if the home has been the scene of a violent crime in the past five years. 
</li>
<li>
A tenant should be provided with a condition report. The tenant should be provided two copies, one of which is for their records, the other is for the property manager. They should be given seven days in which to complete and return this form.
</li>
</ol>
Do you have any "must know" facts from the Residential Tenancies Act? Share yours below.
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10 things you need to know about NSW's Residential Tenancies Act

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A new report shows that home insurance companies are more profitable than banks in Australia.
The Fire Services Levy Monitor Allan Fells has called for greater competition in the industry.
“Insurance companies in Australia are more profitable than banks and this suggests an absence of effective competition. One of the things that would help drive effective competition is for consumers to be better informed,” said Fells.
Fells found that insurance consumers don’t have easy access to their coverage level, with no information about their risk assessment from insurance companies.
He called for a number of measures to improve transparency in the industry, including requirements that insurance companies:
<ul>
<li>Explain premium price changes when policies are up for renewal.</li>
<li>Provide more accessible information about what consumers are covered for under a policy and what they are not covered for.</li>
<li>Explain how they assess an individual’s risks like bushfire, flood and burglary – eg low, medium, high, very high risk.</li>
<li>Clearly indicate any statutory charges (eg stamp duty, GST, fire services levy), detailing them separately to the basic premium cost in the quote or invoice.</li>
<li>Explain what additional charges might be incurred as a result of choosing to pay insurance in instalments.</li>
</ul>
Source: The Office of the Fire Services Levy Monitor
According to Fells, Australia’s home insurance industry also need mandatory short form Product Disclosure Statements.
“Information about what is covered in the policy is often buried in a Product Disclosure Statement that are typically over 50 pages long,” said Fells.
“Other financial services products are subject to requirements to provide a more consumer-friendly, short-form Product Disclosure Statement.”
The Consumer Action Law Centre say the new report exposes “high profits, poor product and price disclosure and a severe lack of competition”.
Gerard Brody, chief executive of the Consumer Action Law Centre, says many people are paying too much for their home insurance due to industry practices, with the insurance industry promoting a false image of market competition by offering many brands.
“While there are many insurance brands in the marketplace, most consumers would not be aware that many brands are dominated by key insurers. The report finds that just three insurers—Suncorp Group, Insurance Australia Group, and QBE—had over 70% of the Victorian residential insurance in market in 2012-13,” says Brody.
He says consumers face difficulties comparing products due to complex and lengthy disclosure forms and unfair contract terms.
“For competition to be effective, we need simple products which can be easily compared with other policies. Comparing product disclosure statements is time consuming, difficult and, frankly, beyond the capabilities of many people,” says Brody.
"Policy terms and exclusions also need to be fair. We’ve seen a caravan insurance policy which said the owner wasn’t covered if the caravan was being towed. This type of ridiculous term can be hidden away in a policy document which is why it’s so important to understand your policy,” he says.
“But if consumers have to go through each contract with a fine tooth comb looking for hidden terms, they’re just going to tune out.”
The Consumer Action Law Centre receives a distribution of over-collected fire services levies, as agreed between the Fire Services Levy Monitor and insurers.
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Big profits, bad disclosure in home insurance industry

The areas in Victoria with rental 'housing stress': TUV

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reiwa.com’s latest preliminary data shows Perth's residential vacancy rate has risen to 4.9 per cent in the past three months to May as the number of properties for lease increased.  This is the highest vacancy rate in six years, after it reached 4.8 per cent in the September quarter of 2009.  There are now 8,147 homes available for tenants, up by almost 600 over the last month. 
Top Suburbs - Available Rentals
Perth 236
East Perth 225
Baldivis 176
Scarborough 167
REIWA President David Airey said the slowdown in Western Australia’s population growth rate had created the oversupply, along with a significant newly constructed dwellings coming to completion.  “The competition among property owners is having an effect on price, with the metropolitan median rent dropping by five dollars on the March quarter to $425 per week, which represents a cut of $25 on the same time last year,” Mr Airey said.  Perth’s median rent peaked at $475 per week in the middle of 2013, but has since fallen by $50, or around 10 per cent, across the board.  “The long term equilibrium for Perth’s vacancy rate is three per cent, so the current situation means there is over 50 per cent more properties on the market than is usual,” Mr Airey said. 
The City of Belmont saw the biggest individual drop, with its local rental median falling from $450 per week to $425 per week between April and May. 
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Perth's highest residential landlord vacancy rate since 2009

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With vacancy rates resting at 5.5%, landlords in Darwin are being urged to pay particular attention to worthy tenants to help protect them against an empty property this wet season.
“The reality is that there’s still a surplus of 1,200 rental properties in the Darwin market, the same figure as 6-8 months ago,” said Glenn Grantham, general manager of Raine &amp; Horne Darwin.
“The market is levelling out with virtually the same amount of new tenants and new rental properties hitting the market every month.”
Raine &amp; Horne Darwin, for example, is averaging 20 new managements a month and 20 new leases.
“We’ve consistently had about 25 vacant properties at the end of each month for the past six months. Yet we’ve been putting on 20 new managements and leasing around the same number of rental properties. This means we have a lively rental market, but the new activity isn’t eating into the surplus – it’s a zero sum game,” said Mr Grantham.
With the Darwin investment market seemingly put on hold for a time, Mr Grantham warns that the duty rests on the shoulders of landlords to be sensible about their expectation regarding appropriate weekly rental.
For landlords who are facing the end of a lease, Mr Grantham advises them to open the lines of communication with the tenant before trying their luck on the market.
The housing markets in the northern suburbs of Darwin such as Millner, Jingili and Moil continue to show strong results, with yields of 5.5% still possible and vacancy rates below the Darwin average.
“There are 350 two bedroom apartments sitting vacant in Darwin, so this market still has some way to go” said Mr Grantham.
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Wet season Darwin landlords urged to move early to keep quality tenants‏

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While real estate agents can utilise tenancy databases for the rental properties they manage, they must follow legislative requirements, NSW commissioner for Fair Trading Rod Stowe said.
“Tenancy databases are an informational resource. They can help lessors make informed decisions when assessing tenancy applications,” Stowe said.
Tenancy databases are run by private companies and collect information about persons deemed as problem tenants by real estate agents, landlords and residential park operators.
Stowe said the guidelines for who, when and why a tenant can be listed on a database are outlined in the Residential Tenancies Act 2010.
A tenant can only be listed in a tenancy database if:
their residential tenancy agreement has been terminated by order of the NSW Civil and Administrative Tribunal; 
they owed an amount exceeding the rental bond for a breach of the tenancy agreement which is still outstanding at the time of the listing.
“The Residential Tenancies Act brings fairness and transparency to the use of tenancy databases,” Stowe said.
“Sadly, unfair listings are not unheard of. While the legislation recognises the right of landlords to take steps in protecting their property, being listed on a tenancy database can have serious consequences for the person listed.”
Before a listing can be made, the tenant must be given at least 14 days notice to review the information and be able to object to the proposed listing.
If a prospective tenant is found on a database by an agent, the agent must write to the tenant within seven days of accessing the database. Outdated listings or listings older than three years are to be removed from a database.
A tenant can contest proposed or existing listings in the NSW Civil and Administrative Tribunal if the matter is not solved with their agent or landlord.
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Rules for listing NSW tenants in databases: Fair Trading

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Vendors considering selling their rental property have been advised to consider how a tenant views the whole process - little more than inconvenience followed by a possible eviction, according to vendor advocacy website vendormarketing.com.au.
According to the guide, vendors need to be honest and upfront with tenants throughout the whole process. If the rental property is going to sell to an owner-occupier (being someone who will live in the place themselves), they need to understand this and have the opportunity to get prepared.
"You should explain the period of time they will have after the sale to move, and tell them that you will provide a reference attesting their cooperation. However, if it is a normal rental property chances are quite high that another investor will buy it. In this case it is in their interest to present the property well and it is likely they could stay. Promise to keep them informed during the sale process. This helps to reduce their anxiety," the guide said.
"Set some parameters around inspections. This includes when the real estate agent can bring buyers through and the extent of the campaign. Inspections should mostly be open house to minimise inconvenience, and the times agreed in advance. Other inspections should be strictly by prior agreement with at least 24 hours notice.
"You must state that no one will go through except as agreed and always accompanied by the real estate agent. The marketing campaign should have a reasonable time limit for instance, 4 weeks, after which you would come back to the tenants if necessary.
"Of course sometimes a tenant is uncooperative or irredeemably messy, or has horrible furniture and you have to make a judgement call whether to sell with them in possession. If it is unavoidable you simply have to do the best you can. Remember that a really difficult tenant can make it almost impossible to sell at a good price, and tenancy laws do very little to help. Fortunately this is rare. Most of the problems are caused by the tenant being taken for granted. Don’t forget to ask them if they would like to buy. You just never know."
For more information, <a href="https://www.vendormarketing.com.au" target="_blank">click here</a>.
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Property 101: Selling rental property – how to keep the tenant on side?

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My Rental Bond has been created to help tenants who are left with no option but to stay in their original dwelling because they don’t have bond money and/or the bond is in dispute. 
My Rental Bond will pay the approved applicants’ bond within 48 hours to help them move out.
According to website Don’t Rent Me, the suburbs worst affected by bond related issues include Randwick NSW, Southport QLD, Morphett Vale SA, Frankston VIC and Quinns Rock. 
Of the total amount of rental complaints, Queensland is currently the state with the highest rate of bond problems at 28 percent followed by South Australia at 24 percent. 
The majority of bond complaints arise due to an unexplained delay in refunding bond which makes it very hard to move into the next rental, as well as nefarious claims of damage which can result in financial loss.
The data was collected by Don’t Rent Me, created by Anthony Ziebell, who has now created My Rental Bond. 
For more information <a href="https://www.myrentalbond.com" target="_blank">click here</a>.
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