riverandsea Buying Tips
If you already own a property that you wish to rent, the letting process starts with a visit from one of our experienced riverandsea Property Managers who will describe the full riverandsea service and discuss the following issues with you:
- Landlords' specific responsibilities
- Tenants' responsibilities
- Which riverandsea management service suits you
- Our terms and conditions
- Our contract with you for management services and the completion of The Management Authority if you wish to proceed
- The legal issues concerning safety
- Advertising and marketing your property
- Viewing arrangements for prospective tenants
- Offer advice on any modifications and improvements that may help to achieve the best rental level and find the right tenants
- Take photographs (or make an appointment to return to take photographs) and details of the property
- Discuss furnishings and what should be removed (if furnished) prior to letting
If you are considering buying a property to let, and have not yet decided on location, together our Property Management and Sales professionals can guide you through the process, and how to consider yield and investment, and assist in defining a total picture for you.
Lenders providing funds for an investment property need to be advised in advance of the purpose of the loan and this may generally attract a higher interest rate than residential property for a personal residence.
This issue, together with taxation implications on the rental return need to be carefully considered prior to purchase and riverandsea can offer general advice and refer investor buyers to appropriate professionals if requested.
Tips to bear in mind if considering purchasing a property to let.
DO's and DON'Ts
- DO think of buying as a rental investment as a long term investment
- DO get your sums right. Will the rent cover the borrowings and costs, even after allowing for possible void periods?
- DO decorate, fit out and furnish (if relevant) to a high standard, especially kitchens and bathrooms. This will attract the best tenants who expect high standards and usually maintain them and helps let the property quickly every time.
- DO make sure that the property is safe and confirms to the statutory requirements in respect to smoke alarms and RCDs
- DO make sure that any white goods or appliances to be included with the tenancy are safe and in good working order and instructions are available as to their operation
- DON'T let personal taste cloud your judgement. Be sure the property you choose meets market requirements and demand.
- DON'T purchase anything with potential maintenance problems such as large gardens or a lot of woodwork requiring regular repainting and treatment. It will add nothing to the rental value and will cost a lot to keep up.
- DON'T think that the running of your rental property can be left to friends and neighbours in your absence. Tenants require a full management service.
- DON'T use off-the-shelf tenancy agreements or forget the issues of the correct amount of time for notices or fail to have a proper inventory and property condition report made before a tenant moves in. It is too late to fix errors after possession so leave all documentation to a professional agent.
- DON'T furnish with second-hand furniture or cast-off soft furnishing (unless in near perfect condition).
Q. Why do I need an Agent to let and or manage my property?
There are many private landlords presently letting their own property. As with many areas of life one could easily carry out the job oneself but it is often better to use the professionals. Having a property to let and finding someone who wishes to rent may appear simple and possibly is but unfortunately the matter does not end there. The professional agent will have experience and expertise in managing property, selecting the right tenant, taking up essential references, advising on the standard of the property, safety issues, drawing up tenancy agreements to conform to current Australian and Western Australian legislation, creating inventories and Property Condition Reports, ensuring receipt of required funds, bond lodgement and ensuring all legal documents are in order. Once the tenant has possession of the property it is too late to decide that you have accepted the wrong person. "Professional Tenants" are practiced in persuading landlords to accept them, sometimes erroneously.
Q. Why do I need my property managed in my absence?
Landlords often consider that their family or a friendly neighbour will be able to "keep an eye" on their property in their absence as they may know the property and may know local contractors who could be called to attend to any emergency repairs. This however, is not the only concern. Letting a property and managing it are two quite different aspects. Professional property management involves demanding and collecting rent on a regular basis and ensuring that rent continues to be paid for the length of the tenancy. Visits on a regular basis need to be made to ensure that the tenants are looking after the property and checking for any routine maintainence problems which may be required, arranging maintenance issues, surveillance of contractors and settlement of accounts, renewals and tenancies. Assuming that the tenancy goes smoothly (and most do), the Managing Agent will be well able to deal with the above matters and the more professional the Agent, the better placed he/she is to deal with problems which may arise with tenants. riverandsea's long history and excellent reputation in Property Management stands as testimony to their excellence in the area of Property Management.
Q. How do I find a reliable Agent?
Property Management Agents, like Real Estate Agents are regulated by the Department of Commerce, the Government body responsible for the licensing and conduct of property professionals. For many years this was REBA's responsibility but was transferred to the Department of Commerce in July 2011. Property professionals, whether selling or in property management have to undergo extensive training before being issued with a licence to work and they must also complete a designated number of re-training and updating hours each year. This ensures that everyone is kept abreact in changes in legislation and best practice and should always be in a position to offer the highest standard of customer service. Of course this does not completely guarantee that a Property Manager is diligent, efficient and professional so, at riverandsea, we provide ongoing training and support to all our staff. We are proud that most of our business is repeat business and referrals.
Q. Furnished or unfurnished?
This is a matter of personal choice and demand. Tenants who look for a long tenancy and want to make a property their "home" as opposed to "somewhere to stay for a few months" usually prefer to be surrounded by their own furniture. If possible, it is good to be flexible in this regard and it is often helpful to offer white goods in a property. Our Property Management experts can assist in this regard if requested.
Q. Am I responsible for maintaining my property?
Generally, yes. The structure, services, heating and cooling are the landlord's responsibility. The remainder depends on the Tenancy Agreement but normally landlords maintain the property and any contents eg white goods, unless it can be shown that the tenant has caused damage. Tenants must be allowed "fair wear and tear" but they must also look after the property as if it were their own.
Q. Who insures the property and contents?
The landlord insures the property and any landlord's contents in the property eg white goods. It is usually wise to consider the most extended cover possible for accidental damage. Landlords should also have insurance to cover public liability on both building and their contents.
Q. What happens if a tenant damages my property?
A professional agent will check your property regularly and any damage should be noted at these visits and the tenant instructed to put the property into good order. At the end of the tenancy, any amount required to repair or reinstate items in or on the property which the tenant has not attended to, may be withheld from the Bond.
Q. Are services usually included in the rent?
No. The landlord pays for the Council and Water Rates however responsibility for electricity, gas, water usage, and telephone. In some cases (usually a large Strata arrangement) water usage may be included in the rent but this would be clearly stated in the Tenancy Agreement. The cost of maintaining lawns and gardens are usually the responsibility of the tenant however many landlords choose to include the services of a gardener to ensure the gardens and lawns are maintained. Provided arrangements are agreed between landlord and tenant and specified in writing in the Tenancy Agreement or documented thereafter by the managing agent, it is possible for landlord and tenant to come to any arrangement mutually acceptable.
Rent collection is an essential part of Property Management and a tenant allowing their rent to fall into arrears is considered a very serious matter. Unless the tenant has requested a special arrangement regarding the rent because of unexpected or unforeseen circumstances which the landlord has accepted and the arrangement documented, riverandsea follows the strict guidelines set under the Residential Tenancies Act to follow-up rent arrears in order to ensure that all rent is paid up to date at all times.
Our follow-up procedure is outlined below:
3 days in arrears - the tenant is sent a 'Form 21 - section 62(4)(a) breach notice for non-payment of rent', which, under the Residential Tenancies Act allows the tenant 14 days to rectify the breach.
Once the 14 day period has lapsed, we contact the landlord to advise of the situation and seek instruction as to whether we should terminate the tenancy. Depending on the landlord's instructions, we serve a notice of termination. Tenants are encouraged to pay by regular bank transfer and by internet banking and these options enable them to pay regular rental instalments.
Q. What happens if a tenant does not vacate my property at the end of the tenancy or when directed to do so?
Possession proceedings will be instigated in accordance with the Laws governing Residential Tenancies.
Q. Will I ever have to go to Court if there are disputes with my tenant?
Everything is done to avoid taking a tenant to Court and riverandsea's professional property management staff strive to reach agreement with landlord and tenant where there has been a failure to adhere to the Tenancy Agreement without going to Court. In some cases however, this is not possible, and riverandsea's Property Manager would normally attend Court as the landlord's representative should the landlord not wish to attend. The authority to the Property Management team to carry out this service for the Landlord is included in the Authority to Manage.
Q. Safety and the Landlord's Responsibilities?
The following information is from the FESA web page and this and other useful information on fire and safety and smoke alarm legislation can be found on their Website at www.fesa.wa.gov.au
"Smoke alarm legislation requires homes and rental properties in Western Australia to have mains powered smoke alarms professionally installed before they can be sold, tenanted or hired for payment.
Effective from 1 October 2011 smoke alarm regulations apply for existing dwellings that are made available for hire. This includes boarding and guest houses, farm stays, short term holiday accommodation homes and apartments.
Additionally all landlords who own or lease a dwelling with a residential tenancy agreement in place must have mains powered smoke alarms installed by 1 October 2011.
Each year families across Australia lose a loved one as a direct result of a house fire. Many do not have a working smoke alarm.
Only working smoke alarms can provide the critical early warning needed to save lives and minimise property damage. FESA recommends mains powered photo- electric smoke alarms installed by a qualified electrician.
To ensure smoke alarms work properly, FESA encourages householders to test smoke alarms monthly, undertake six monthly maintenance checks and replace batteries annually, where required.
FESA run an annual pre-winter campaign to drive community awareness urging people about the importance of smoke alarm maintenance and reminding those with battery operated alarms to replace their smoke alarm battery on April Fools' Day (April 1) every year."
The Department of Commerce & Consumer Protection
This is the Government Department responsible for administering the legislation that governs Residential Tenancy. Comprehensive information is contained on their website: www.commerce.wa.gov.au
Other useful guides are:
Western Australia - Renting out your property - An owner's guide
Legislation: Landlord and tenant issues are governed by each state's Residential Tenancies Act (RTA). Western Australia - see the Residential Tenancies Act 1987
Bodies handling tenancy disputes: Western Australia - Department of Consumer and Employment Protection administers the RTA and a Magistrates Court for tenancy disputes.