GET TOUGH Early intervention protects your investment against defaulters
JUST as timing is everything for tenants, so it it for landlords.
If a tenant is not paying rent, intervene early, advises Andrew Schaefer, managing director of national property management company Trafalgar.
“Negotiate a decisive solution, including the option of vacating the unit before arrears become unaffordable to settle. Don’t tolerate a broken promise to pay. Give notice for the unit to be vacated and stick to that.
“A legal eviction should be the last resort and only necessary in exceptional cases as it is hugely expensive, delayed and, in general, an unsatisfactory option.”
Shaefer urges landlords to always try to solve the issue within the deposit rental cover period (for example, one month if the deposit covers one month’s rental). Ensure the deposit covers utility charges, which are generally raised monthly in arrears.
Ben Shaw, chief executive of HouseMe, an online rental disruptor, says landlords do understand there are certain things over which tenants have no control. He says “a job loss, an unexpected medical bill or family emergency are all unfortunate realities of life”.
“Should a tenant stop paying, get in touch and don’t assume the worst. Most times you will be able to come to a fair repayment plan as good tenants want to stay in good properties.
“The best cash flow protection would, of course, be a rental guarantee, which could cover your lost or late rental while you negotiate with your tenant.”
HouseME’s Rental Guarantee has been designed for this. For only 1% of the rental price, you can expect cover for up to three month’s rent if the tenant defaults.
“In a tough market for consumers, landlords also struggle. Late payment of rental causes them to miss bond payments, and vacancies prevent bonds from being serviced at all. Key to resolving these concerns is fair pricing. At the right price there is always demand, and rent remains affordable,” says Shaw. CORINNE RAS Knight Frank letting agent, gives this advice to tenants who have a “neighbour from hell”.
“When renting a property, often the homeowner does not know or have contact with the neighbour, so handing the matter over to the homeowner could be fruitless.
“If the neighbour is causing a continuous disturbance, it would be advisable to first have a chat with them.
“It could be they are unaware their behaviour is disturbing those around them. By building good relationships with your neighbours it could develop into a lasting and mutually respectful relationship.
“If the disturbance is continuous after a few times of you having reached out to the neighbour, then authoritative action may be required in the form of reporting it to the local police.
“Tenants should always keep the homeowners in the loop because it is their property.”
ACT QUICKLY Timing is everything for both tenants and landlords, so take action immediately if a tenant defaults on a rental payment. | PICTURE: HEATHER ZABRISKIE
BOUNDARIES When owners rent out property, they may not know anythingabout the neighbours.