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Weekly Rental Report

Weekly Rental Update 25 July 2019 - 31 July 2019

Managing Rent Arrears


You have a residential investment property it can be a great way of building a nest egg. Although this can be very stressful if the rental monies are not coming in. You need to have an early intervention process to get the rent payments on time or to bring the tenancy to an end. Quite often landlords are too embarrassed to ask their tenant for monies outstanding and may leave until it becomes urgent and then it is too hard for the tenant and landlord to get up to date. If this is sounding familiar and causing you stress this is where having your property professionally managed takes care of all this. The key when it comes to dealing with rent payment problem is to make sure you have early intervention. The tenancy agreement should clearly state how rent is to be paid and when. You should also keep rent records so you will know if your tenant falls behind in payments straight away. If your tenant does miss a payment you to find out the reason for that missed payment and to make a payment proposal to get back on track.


Here are some steps you can take to help you get the rent repaid.


You can send a letter via email notifying your tenant that they have 14 days’ notice to remedy the breach overdue rent If you have the read receipt setting on, you will receive confirmation that the email has been opened. Or you could hand deliver this to them. If your tenant doesn’t pay after receiving a 14-day notice to remedy, or if they are more than 21 days behind in rent, you can apply to the Tenancy Tribunal for a mediation between you and your tenant.
If an agreement is reached to repay the overdue rent, a mediator’s order documenting the discussions will be issued.


Harcourts Just Rentals have a Zero Tolerance to Rent arrears.


We also get our tenants to sign our rent arrears policy, so we make sure tenants fully understand and acknowledge our policy. Often, we find that some landlords feel embarrassed to chase their tenant for outstanding rent or don’t have them time to ensure that the rent is always paid on time. If you answered yes to either of the statements above, why not give Harcourts Just Rentals a call to discuss us managing your rental property and we can ensure the rent is always paid on time. We work very hard to ensure that all our tenants pay their rent on time which means that 98.45% of our tenants pay their rent on time.
policy to make sure they acknowledge and fully understand our policy.

 

Tammy Drinkwater
Business Development Manager
021 892 443 | 09 438 2054
tammy.drinkwater@harcourts.co.nz

Weekly Rental Update 18 July 2019 - 24 July 2019

Tenancy Types – Which One Should You Use?

 

I thought it would be a good idea to cover off on the differences between tenancy types available to landlords and tenants. When you are purchasing an investment property it is important to work out what type of tenancy will work for your plans for your investment property.


Fixed Term Tenancy

A fixed term tenancy lasts for a set amount of time. This gives the tenant peace of mind that they have secured the property for a certain time, such as 12 months. A fixed term tenancy does not end automatically when the stated period comes up. To renew the fixed term agreement the property manager or landlord must either offer the tenant another fixed term agreement in writing and the tenant signs for that period of time or send a written confirmation to say that the fixed term will not be renewed. This must be done no earlier than 90 days and no later than 21 days prior to the fixed term agreement ending. If you do not do renew or end the fixed term agreement it will automatically revert to a periodic tenancy.

 

Tenants cannot end a fixed term agreement early without the owner agreeing to it. You can agree that they may leave but they must continue to pay the rent until a suitable new tenant is secured and moves into the property, unless you come to another agreement that both parties are happy with. I would recommend having this in writing and signed by both parties.

 

Being on a fixed term agreement means you will always know how much income you will have for the period of the fixed term.

 

If you would like to increase the rent every 180 days, you must ensure that you have a rent increase clause written into your tenancy agreement.

 

If you are going to sell your property it is advisable to wait until the fixed term ends. If you do decide to sell the property during a fixed term, the new owner would need to take over the tenancy when the property settles as the tenant is allowed to stay in the property until the fixed term agreement ends.  

 

If the tenant signs up on a fixed term agreement and they turn out to be not as good as you hoped, it can result in having to take them to Tenancy Tribunal in order to move them on.

 

Periodic Tenancy

A periodic tenancy is one that continues until either the tenant or the landlord gives written notice to end it.

 

There is no single date that the contract concludes, which has both upsides and downsides. Rather than having to worry about renewing the agreement every single time, a periodic tenancy can just keep rolling until one (or both), parties have decided that it is time to end the agreement.


If you decide that you want to sell the property or even take possession yourself, you can do this much easier with a periodic tenancy in comparison to a fixed-term agreement. You must always advise the tenant the property is on the market for sale and then once you know what the new purchaser would like to do, you either advise the tenant that they are staying on or give them the required notice of 42 days.

 

 On a similar note, a problematic tenant can also be removed more easily if they are on a periodic tenancy simply by giving them notice, however the notice that you must give them is 90 days.


You can give 90 days notice at any time—but your tenant can give their 21 days notice at any time as well.

 

If a landlord or property manager issue 90 or 42 days, notice the tenant can counter sign with 21 days notice at any stage during the notice period.

 

A landlord can also issue 42 days when the owner (or a member of their family), are moving into the property.

 

The team at Harcourts Just Rentals use both fixed term and periodic agreements for our tenancies. However, our preference is fixed term agreement as has more security for both the landlord and the tenant and minimises wear and tear on the property with tenants staying at the property for longer periods of time.

 

If you have any questions around the types of tenancies please do not hesitate to give me a call.


Tammy Drinkwater
Business Development Manager
021 892 443 | 09 438 2054
tammy.drinkwater@harcourts.co.nz

 

Weekly Rental Update 11 July 2019 - 17 July 2019

20 Questions to Ask Potential Tenants


A follow up from my last week report -20 Questions that may help you to get a great tenant. Based on what kind of responses the prospective tenant provides, you may be able to save both of you a lot of time. This is a very important part of the process and can save you a lot of hassles in the long term by making sure you have the right tenant and a suitable property for tenant and not wasting your time and theirs. For example around the tenants pet, you explain about your pet policy, you both may come to the understanding that their application would be denied based on pet ownership. They may also pick up something about the rental that does not suit them or what their family requires i.e. not fenced for children and they may be an important fragment and then decline and decide not to pursue the property any further. Then you can be confident you have conducted an efficient pre-showing interview that gives you time to work with truly qualified applicants.


Here are some basic questions you may start with then you can enhance areas that may be appropriate to this property.


1. Do you currently rent, and if so, where?
2. How long have you lived in your current home?
3. Why are you looking for a new place to live?
4. What date would you want to move in?
5. Is school zoning important to you?
6. What kind of work do you do?
7. What is your budget for Rent?
8. How many people would be living with you?
9. How many people living with you smoke?
10. How many parking spaces would you require if you rent here?
11. Do you have pets? What are the pets?
12. Does your current landlord know you are thinking of moving?
13. Do you think your current landlord will give you a favourable reference?
14. Have you ever had an eviction?
15. Are you familiar with the rental application process?
16. Are there any issues I should know about before I run a background screening for all the adults in the household?
17. Do you have any court fines that would hinder you application? We ask this as the tenant may have an explanation and then it may not hinder your application.
18. Will you be able to pay the Bond amount of $....... and the two weeks rent in advance
19. Are you willing to sign a 12 month fixed term agreement? Or whatever the agreement is ie periodic?
20. Do you have any questions for me about the process?


You may like to add more questions but it is important that you do systematic reference and character checks. Most previous landlords are more than happy to supply information about tenants whether it be good or bad. This will save you complications further down the track. If unsure investigate further.

 

Tammy Drinkwater
Business Development Manager
021 892 443 | 09 438 2054
tammy.drinkwater@harcourts.co.nz

Weekly Rental Update 4 July 2019 - 10 July 2019

Selecting the right Tenant can be Make or Break !


Selecting the right tenant for your investment property can be tough, especially when you want to get someone in there and paying rent straight away - but make sure you look out for these warning signs.


Many people make the mistake of not paying attention to the quality of the tenant – as long as they have rented the property and are achieving a high rent, they’re happy. However, this is often cause for concern later down the track when they are forced to spend a large amount of money fixing the damages caused by out-of-control tenants and spending time searching for new tenants when they don’t work out.
If an applicant applies to rent your property but does not provide any supporting documents or references, there is usually a reason why and you should proceed with caution. When you specifically request this information and they still cannot produce anything, I think it is safer to simply select another applicant.


Rent should always be paid on time. An applicant who is constantly late with rent or still owing money to their previous landlord will always be this way, and I can guarantee they will be a financial burden to you. One of the most common excuses applicants make for being behind in payments is that their previous agent was not organising repairs on time – even if this may be true, it is a major red flag.
If an applicant has moved properties every six months for the past three years and explain they did so for a lifestyle change, you can be fairly confident you will be looking for a new tenant six months down the track if you proceed. It is also likely that they were not looking for a lifestyle change but instead were asked to leave their other rental properties. Doing all reference and criminal checks thoroughly is very important and knowing where to look to check these details.


If you need advice or have any concerns on this matter don’t hesitate to contact me at Harcourts for a non-obligation chat. Our property management team are experienced and can give you advice on how to do this effectively and safely to protect your investment.


Next week’s read - Important questions to ask a potential tenant.


Tammy Drinkwater
Business Development Manager
021 892 443 | 09 438 2054
tammy.drinkwater@harcourts.co.nz

Weekly Rental Update 27 June 2019 - 3 July 2019

Are you doing a good job on property inspections?
How to complete routine Inspections. 


There is various way of completing a routine inspection on a rental property. Typically these are completed every 13 weeks and include a large number of routine checks. These checks may include cleanliness, wear and tear to the property, any damage, water leakage, security of the property and compliance matters. Generally, there is a feel that routine inspections are completed to ensure tenants are completing an appropriate upkeep on the property, however, this is only a small aspect of the routine inspection.


It is important to inspect a property for potential damage or even liability issues that may be minimised. Any potential water damage must also be looked at. This can come in a number of different forms from observing a leaky tap underneath a sink or noticing a full gutter in need of clearing and cleaning to avoid potential damage in a roof area.


Sniffing out unapproved pets is an interesting matter. The tenant may attempt to hide any evidence of the pet by removing its food bowl, water and bedding but they may have not removed the food from the pantry or laundry. Also drug using utensils these could be hidden or tucked away obviously these are forbidden and sometimes hard to spot, but these are the reasons that inspections need to be exceptionally thorough and documented and dated and photographed. Sometimes it takes a seasoned Property Manager or Asset Manager to sniff all these things out.


Security at a property is paramount in safeguarding your tenancy. Checking all the windows and locks are intact is really important to maintain tenancy in a safe manner.


At Harcourts Just Rentals our experienced team carry out inspections on Rental propertys regularly with an initial 6 week check and then 13 week thereafter. We have developed the most effective way of managing your property with the Pod Management there is an entire team familiar with your property. We also take a large amount of photos on our first inspection and then at every inspection. The report and any concerns is the sent to the landlord.


Joining us is incredibly easy and we aim to make it seamless, hassle free process for you. Whether you are a private landlord or you need a change from your existing management team.
Simply phone us on 09 438 2054 or call into our office at 33 Robert Street, Whangarei or email me on tammy.drinkwater@harcourts.co.nz or 021 892 443. 

 

Tammy Drinkwater
Business Development Manager
021 892 443 | 09 438 2054
tammy.drinkwater@harcourts.co.nz