Wide Bay Presitge Properties Blog

As a Property Manager, we are often faced with a lot of choice when choosing a tenant.  We can have up to 10 applications per property!  I have decided to write down some suggestions to help tenants get the approval for the home that they want.

• Fill out your rental application in FULL.  Nothing frustrates a Property Manager more than having to chase up phone numbers and fax numbers for your references, or to ask you to come back to the office because a section has not been signed or filled in accurately. 
• Treat the Property Manager with respect.  Ensure that you are polite and accommodating at all times.  Even though it is often the owner who ultimately chooses their favorite applicant, the Property Manager will give advice to that owner.  If you seem difficult to deal with initially then it is likely that the Property Manager will not want to deal with you as a future tenant either.
• Ensure that you understand how long the application processing process is, and give the Property Manager a reasonable time to process your application before ringing up to see if it is done yet. 
• Check your affordability.  Most real estate offices work off a 30 or 35% rule.  That is, if the rent is under 35% of your income, then generally it is taken to mean that you can afford the property.  If you have no income, but a large savings, be sure to write this in your application and include a bank statement as proof.
• Term of the lease - most applications will ask you to write down what term of lease you require, for example 6 or 12 months.  If the term is not important to you, make sure you let your Property Manager know, often Landlords who have more than one application to consider will select the one which is offering the most desirable term.  Some landlords favour long leases, whereas others require a short lease.  If it does not matter to you, state that in your application.
• Ensure your references are contactable during business hours.  Often tenants put down references and provide a home phone number for them when they are actually full time workers.  Ensure that if your personal references are working full time that they are going to have a mobile on them or that you can supply their work number.  Make sure your references are aware that they are listed as a reference so they are expecting a call.  The main reason it can take a longer time to process applications is that a Property Manager can not get a hold of your references.

Overall, the best way to get your application processed and presented to the Landlord first is to ensure that you are easy to deal with, and have your forms filled out correctly to give your Property Manager the best chance to easily process your application.  Of course, other factors will come in to play, but if you take the advice above it will definitely help.

Often, as a real estate agent, I am asked to take over rental properties from Private Landlords.  Most of the time when this occurs, the reason that I am taking over is that the private landlord has fallen into trouble with the tenant and needs some professional assistance. 

Common mistakes private landlords make include:

• RENT ARREARS - it can sometimes be stressful and difficult as a private landlord asking your tenant for the rent monies when they are going through financial hardship.  Often private landlords get relationships with their tenants, or they are friends to begin with and the emotional attachment they have to their tenants makes it difficult to be stern.  This can leave the landlord in a difficult position themselves financially.  We once took on a property where the private landlord had let the tenant get 7 months behind in their rent! 
• ERRORS ON LEASE DOCUMENTS - Real Estate agents are specially trained and updated by the REIQ every year on legislation changes.  The lease document is key to getting the tenancy off to a good start.  Many times we see landlords who have made critical errors in this document and it can cost them money down the track.  Some of the mistakes include - writting the tenants name under lessor and putting illegal special conditions on the lease.
• LOW RENTAL RETURN - professional Asset Managers are up to date every day with current market conditions, and always know exactly how much a rental property should be returning.  Private landlords can sometimes undervalue their homes, or at the opposite end of the scale, overprice their homes and have a very high vacancy period.  We have taken on a number of homes that are under-priced, and some as much as 30%.  Your agent can set you a rental increase plan so that the rent regularly increases in accordance with the market.  By pricing the home appropriately and exercising the rental increases at appropriate times, you will maximise your income.
• TENANT SELECTION - Private landlords do not have access to national tenancy databases, like TICA, as do agents.  These databases carry valuable information about tenants who have defaulted in the past.  Often Private landlords are targeted by these undesirable tenants, as they know the landlord will not have access to their past information. 

In summary, Private Landlords are every day people.  Many of them do a fantastic job self managing their properties, and some have even made a second job of it!  However, many do not have the professional skills and knowledge to handle the many situations they may find themselves in, and no access to the appropriate software, databases and programs that agents do.  Real Estate Agents manage properties every day, and have experience in all areas of the job.  

On average, in our local area, it costs $20.40 per week to have your property professionally managed.  For the money you will save, the hassles you can avoid, and the extra money a professional service can make you, why would you do it yourself?

You will often hear of horror stories of tenants moving in to rental properties and doing damage, not paying the rent and sometimes even refusing to move out.  Often this results in a very distraught landlord who may not have the money or the means to fix the problem.

Luckily, situations like this occur on the rare occasion, and the majority of tenants are good law abiding citizens who pay their rent on time and look after their homes as though it were their own.

At our office, we consider the initial screening of the tenant to be one of the most important jobs we have.  After all, if we select a great tenant, our workload is a lot less and therefore our profit margins are much higher – as well as the fact that our clients are happier.

However, despite all the systems and procedures we have in place to ensure the above does not occur, we recently have had one of these unfortunate instances with a tenant of ours, and the damages and loss of rent bill has totaled just over $11,000.

It broke my heart to see these tenants do such an awful thing to our client.  However, there are a number of important lessons that other landlords can learn from their experience.

The first thing to point out is that even good tenants who have great references, no bad recorded history, and a good income or occupation can still turn bad.  People’s lives change, they get divorced, they lose their jobs, they develop abusive relationships, or they can fall in to other traps and bad situations. When these changes occur their financial situations can change, as can their attitudes and personalities.   Just because they have a good history and are good when they occupy the premises does not mean they will be good forever.

The second thing you can learn from the experience is to protect yourself against these potential losses.  My clients did not have any insurance to cover their problem.  This means that they have to find $11,000 to fix the problem themselves.  While we are going through court proceedings to claim this money back from the tenant, there is no guarantee that the judge will rule in complete favour of the landlord, and no guarantee the tenants will have the money to repay the landlords.  Meanwhile, because of the state of it, the house sits vacant with a mortgage on it and does not earn an income.

As a landlord myself, I always make sure I am adequately insured.  The insurance you need is called Landlord Protection Insurance, and most large insurance companies offer this service and can package it together with your regular insurance policy.  There are also some smaller companies who specialize in the service. 

I have written this post today to demonstrate that bad situations can occur – even if you have a fantastic real estate agent, or if you have done the reference checking yourself and think that you have chosen well.  While these bad situations only happen on the very rare occasion, if you cannot afford for it to happen at all, I strongly recommend you be insured. 

If you would like to know more about Landlord Protection Insurance, or our tenant screening process, please contact me and I’d be happy to answer all your questions.

Our office offers a comprehensive Consumer Protection Guarantee which can assist in reducing the risks involved in renting out your property and we’d be happy to send you a copy of this should you be interested.

As a real estate salesperson I am occasionally called upon to appraise an old run-down house, a block of land with crumbling sheds, or an overgrown farm which has seen livelier times. Many would see this as a necessary evil of the job - stomping through snake infested knee-high grass and flea ridden moldy carpets. Me, I get a twinge of excitement every time I pull up to a seemingly abandoned property…. especially if there is a shed.

Why, you may ask, would an

Scattered all over the Queensland countryside are garages, sheds and barns with an old ‘classic’ tucked inside just waiting to be discovered. Some may have been farm workhorses, others daily transport, and just once in a while there’ll be a true classic desperate to find a new owner willing to bring it back to life.

Here are a few examples of some ‘finds’ around Maryborough that I have stumbled across in the last year:

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- Jaguar S-Type

- 1951 Packard

- Very old Chevy pickup

- 1912

- Austin Sheerline

- Hillman Superminx

- 3x Ford Prefects (at one house)

- Ford Falcon XA GT

- H

- Cortina Mk1 2-door

- Rover P6

So, next time you see a dilapidated garage or barn, take a peek inside. You may just discover an

Trevor Newman, Wide Bay Prestige Properties

Recently I spoke with a landlord who had just purchased a property.  The property was vacant and he planned on renting it out as soon as possible.  He had left it to the last minute to find a suitable property manager and seemed only concerned about finding one who would negotiate on commission. 

After spending about a week running around and talking to some agents, he managed to find one who would do it 1% cheaper then everyone else.  He happily signed his management agreement.  About a week later I noticed that his property was not even advertised for rent, and probably a few days after that is when it appeared on the internet. 

The 1% that he saved equates to about $124.80 per year.  His property is a $240/wk home.  So if you do the maths you’ll notice that if he had have chosen an agent based on their efficiency and competence rather than their 1% discount he would have saved at least $300 for that year.

Other dangers with choosing cheap agents could include: getting a bad tenant, long vacancy periods, poor rent returns, poorly negotiated lease renewals, poorly managed rent arrears, less annual inspections or maintenace not promptly attended - many of these problems could cost you thousands!

Remember, you are dealing with a very large asset and you want someone who is professional and can handle your asset with care. 

If you have had a bad experience with an agent, post a comment here and let us know about it!  Thanks for reading!

Regards,

Jade Guilmartin

As a real estate agent, I would say that only about 40% of home owners are successful at presenting their homes effectively for sale.  It is a proven fact that if your home is well presented, you can attract a higher price for the home, or attract a buyer who might not otherwise be interested.  Some handy hints for presentation include:

• Ensure that the home is free from clutter.  For example, keep a bucket in the bathroom, whenever there is an inspection due, take all of the products off the vanity, put them in the bucket and store it in the cupboard.  I mention this one first because clutter is the single biggest problem in house presentation.  We all love our belongings, but what is a treasure to us might be unsightly or trashy to the eyes of another.  Store away as much clutter as you can before putting your home on the market for sale, this will also make it easier when a contract is secured and you have to move out.
• Keep lawns mowed and gardens weeded.  It is surprising how attractive lush lawns can be to a person.  I, myself purchased a home that is way too small for me, but I remember how much I loved the front yard and how green the grass was!
• Try sugar soaping the walls or engaging a professional cleaner for those annoying little jobs like cleaning the fan blades and the window sills/tracks.  When we live in a home, we often overlook these details, but it can make a difference to the overall feel when a buyer enters the home.
• Check for cobwebs - there is nothing more unattractive than a home with cobwebs, it tends to make your home feel older, dusty and poorly cared for.
• Keep your pets out of the way when prospective purchasers are coming to view the home.  Some people are allergic to pets, some don’t like animals and others are just plain scared of them.  Make sure you pick up any “mess” the pets make too.
• You could appeal to the buyers sense of smell with a roast in the oven, a cake baking, some fresh flowers - or whatever you like really (as long as its something that people like to smell).  The smell makes it feel more like home to them.

These were just a few ideas and suggestions.  There are many articles that give great ideas on how you could present your home.  We have some more handy hints in our Information Pack we send to those who are thinking of selling - be sure to ask us for one if you’d like.

One final comment i’d like to make on this is - make sure that when your agent comes through the property you are NOT there.  It is very difficult for prospective purchasers to imagine themselves in the home if you are there.  If you absolutely must be there, make sure you position yourself in the worst room/part of the property.  So if the home has a lovely deck that looks over the ocean, do NOT stand on the deck while the agent shows the buyer through.  It is important that the buyer experience all the good points, and if you are there they are more likely to spend less time looking in that part of the house.

Finally, please feel free to share any tips you might have.  Just post a comment!  Thanks for reading, happy selling!