How to find the best tenants

How to find the best tenants

Tenants are an important part of your investment property succeeding, so here are some tips on getting the best tenants and minimising tenant turnover. Find the right property manager Finding the right team to manage your property is critical. Too many people do property management because they think they should rather than they want to do it. They must: • Have a dedicated property management division. • Have experience and have had previous success with problematic tenants. • Have an agency principal involved in the function of the property management division. • Have a manager that does/oversees inspections. • Has good programs and processes for vetting applications and monitoring rental arrears. Update your property By keeping your property in top condition, you’ll attract tenants who take care of their belongings and property, and it will also keep you ahead of the competition. Ensure property updates suit your target demographic. Set the right price Keep your rental price in line with similar properties in the area or other landlords will gain a competitive edge in the search for good tenants. Your real estate agent should advise you about the current market and how much similar properties in the area are being rented out for before deciding on a realistic price. Always run a credit check It’s a good idea to include a credit check in the screening process as it is usually safer to choose a tenant who has good established credit. Ensure reference checks are being performed Ensure your property manager makes reference checks with the applicant’s previous landlords, who can clarify whether the tenant paid their rent on...
Property 101: Airbnb guests breached tenant’s lease of property

Property 101: Airbnb guests breached tenant’s lease of property

This is an old decision but one that should be remembered. In June 2016 the Supreme Court of Victoria handed down its decision in the case of Swan v Uecker [2016] VSC 313. The case is heralded as a victory for landlords after the Supreme Court held that, by allowing Airbnb guests short-term use of their rented apartment, the tenants had breached their lease by sub-letting the property. The Landlord (Swan) leased her apartment to the Tenants (Uecker and Greaves) pursuant to a residential tenancies agreement (lease). During the course of the lease the Landlord became aware that the Tenants were making the apartment available to guests via the Airbnb website. The Landlord had not consented to the use of the property in that way. The Landlord subsequently sought an order for possession from the Victorian Civil and Administrative Tribunal (VCAT) on the basis that the Tenants breached their lease by sub-letting the property, without the Landlord’s consent, when making it available to Airbnb guests. VCAT dismissed the application. The VCAT decision held that, despite offering the property to Airbnb guests, the Airbnb Agreement between the Airbnb guests and the Tenants as hosts did not entitle Airbnb guests to exclusive possession of the property and granted a mere licence to occupy. On this basis, the Tenants “had not sub-let their tenancy agreement” with the Landlord. The Landlord appealed to the Supreme Court. The Supreme Court held that the Airbnb Agreement between Uecker and Greaves and the Airbnb guests was characterised as a lease, rather than a mere licence. Accordingly, the arrangement to allow Airbnb guests to occupy the property constituted...
New strata laws and their benefit to investors

New strata laws and their benefit to investors

In case you haven’t taken the time to update yourself more than 90 strata law changes passed by the NSW Government came into effect on 30 November 2016 and investors looking to renovate their apartments could reap the rewards. The laws, which changed as part of the usual 10-year re-evaluation, have been viewed as potentially revolutionary for apartment owners, due to a change in the “strata renewal” clause which will allow 75 per cent of owners to support developmental changes instead of the previous 100 per cent. The changes present great opportunities for investors in older blocks, opening up the chance to sell to developers or renovate to increase capital growth without 100 per cent backing by other owners. The new laws have been designed to not only make it easier to update ageing buildings, but to increase density as part of the government’s urban renewal strategy. Apartment owners can choose to cash in by selling to a developer, but they may be better off holding on and redeveloping their property to perhaps add a penthouse or other amenities with the benefits shared by all owners. Not everyone is happy with the changes; critics of the laws have said they provide unfair pressure on financially vulnerable residents who may be forced into changes they do not support. Other changes that came into place include the role of developers in strata committees – they are no longer able to act as strata managers or vote on building defects. Owners need to review the funding of a 10-year capital works budget (previously called a ‘sinking fund’) at their initial and annual meetings; previously...
Good tenants – Are they appreciated?

Good tenants – Are they appreciated?

Would you prefer stable, reliable tenants over a higher rental income? Most landlords would say ‘yes’, but it seems top tenants aren’t feeling the love. Australian landlords overwhelmingly prefer good tenants to higher rents, according to a presentation to investors by Rent.com.au, but renters, it would seem, don’t think it makes a difference. Referring to renters as “an important group without an advocate”, Rent.com.au’s presentation cited survey data that showed 57 per cent of renters believe renting is still not well accepted and a staggering 95 per cent believe good tenancy is not rewarded. The presentation quoted an anonymous renter who said, “Why can’t people who rent be shown the same dignity as people who are viewing a home that’s for sale? I guess that’s society though, but it isn’t right.” In addition, 83 per cent of renters feel they do not have a voice or advocate in politics, despite issues affecting them, such as negative gearing, being on the agenda. Worth noting for investors as well is the fact that 67 per cent of renters cited a lack of information on properties, suburbs and landlords as one of the “top pain...