Commonly Asked Questions About Property Management

Maximising Your Rent

How do you determine the best rent for my property?

We always strive to get you the maximum rent possible; however we also must keep in mind setting the correct market rent to get your property rented as soon as possible. Both factors are important to present your property on the market successfully for rent. To do this, we consider these factors:

a) Demand– Is there a high or low demand for properties at present. This can be seasonal and affected by a number of factors.

b) What is available now– We look at properties currently available for rent in the newspaper and/or the internet, and consider their location and features for comparison to calculate a maximum rent for your property.

c) What we have rented right now– We compare your property with what we have currently rented, taking into account property location and features. These factors allow us to give you enough information to set the right rent for your property.

What if I want a rent amount that is higher?

You may place your property on the market at the rental amount you wish. However keep in mind that it is the market demand that sets the rent, and if the market (prospective tenants looking for a rental property) deem the amount of rent too high, your property may stay vacant longer than necessary.

With this in mind, be aware your annual rental return will be reduced by 2% for every week it is vacant!

How does the rent get reviewed during the time that you manage it?

When we need to secure you a new tenant, we will always review the rent against market conditions. This will also be done at lease renewal time, or at other times when required. We will always contact you for your permission before the rent is increased.

Getting the Best Tenant

How does someone apply for my property?

We always ask that the prospective tenant fill in an application form, signing, giving permission for us to check the information provided. We will never discuss an applicant with you without this application form completed prior to contacting you.

What if an applicant contacts me?

If, in the unlikely chance a prospective tenant contacts you to discuss their application, or in fact ask questions about their rejected application, we insist that you simply request that they contact us (Real Estate Mackay City). If they persist we insist that you do not discuss anything further to avoid unnecessary problems and complications.

How do you check an applicant?

With the information provided we confirm their payment and tenancy history by calling their current and/or previous landlord/agent as well as confirming their employment, checking them against the National Tenancy Internet Database (TICA) to see if they have been lodged by a previous agent as having breached their tenancy in some way.

In some cases where an applicant may not have a tenancy history, we attempt to confirm other information that may give us insight to show their ability to maintain a tenancy in your rental property. For example, a stable employment history. In some cases where this is not possible we may simply reject the application.

What reason do you have to give the applicant to reject their application?

Legally, we are not obliged to provide to the applicant a reason for rejecting their application.

Who selects the applicant for my property?

You do! We will simply give you the information we have collected and by using our experience give you a possible guide as to the tenancy outcome, but at the end of the day it is always your choice!

Do you guarantee the tenant?

We can never guarantee any approved tenant for your property. We can only attempt to collect information on their past history and confirm their income arrangements. As paying of rent and maintaining the property is purely voluntary, we cannot guarantee any tenancy outcome. This is a landlord risk that comes with allowing someone else to rent your property!

The Marketing of My Property

What do you do to advertise my property?

Once we have a signed Management Agreement authorising us to act on your behalf, we list your property in the following forms of advertising:

  1. Rental Listing Brochure – Your property is added to our office listing brochure with a photo and details of your property. This is given to anyone that comes in looking for a rental property.
  1. Internet – Your property along with photos is entered onto the following websites, maximising coverage to any prospective tenant using the Internet to locate a rental property.

a)   realestatemackaycity.com.au

b)   www.realestate.com.au

c)   www.domain.com.au

d)   www.rent.com.au

e)   and other national and international web sites

Property Presentation

How should the property be presented?

We ask that the property be presented in the best manner possible to attract the right tenant for your property. We don’t want a bad first impression to deter the right tenant from renting your property.

The property should be presented ‘reasonably clean’ in accordance with legislative requirements. As a very general rule we ask the tenant to leave the property at the standard they found it. In cases where the property is provided in an extreme level of cleanliness we ask the tenant to leave the property likewise. However in the case of a dispute, legally we can only enforce that the tenant return the property in a ‘reasonably clean’ condition, this being their minimum legal obligation.

Please refer to Section Three in our Exclusive Property Owner’s Handbook ‘A Guide to Getting Your Property Ready for Your Tenancy’ (see page 17) with tips and a checklist on how to present your property for rent. (go to Quick Link at the bottom of page)”

Pets at My Property (If Permitted)

If I allow pets at my property, what expectations will be given to the tenant?

If pets are permitted we will always require them to sign a formal set of pet approval conditions.

This obligates them in the following ways:

a) No additional pet may occupy the property without prior permission.

b) The tenant must be responsible for any damage caused by their pet, and remove any rubbish or faeces deposited by the pet and have the carpet professionally cleaned.

c) The tenant must have the property professionally fumigated inside and outside upon vacating the property with a receipt provided to the managing agent.

We also record the details of the pet on the agreement, which is then signed by the tenant. If an existing tenant contacts the office to enquire if they can have a pet, we ascertain the pet type and details, then contact you, the property owner to ask permission on the tenant’s behalf. If approval is given, the tenant is advised of the decision and a declaration will be forwarded to the tenant for their signature stating:

a) The tenant must be responsible for any damage caused by their pet, and remove any rubbish or faeces deposited by the pet and have the carpet professionally cleaned.

b) The tenant must have the property professionally fumigated inside and outside upon vacating the property with a receipt provided to the managing agent

Receiving My Rent Monies

When do I get paid my rent?

We will deposit all monies collected into your nominated bank account. At the middle and end of the month (the first week day after the 15th and the first week day after the end of the month).

How do you collect the rent?

We collect the rent by direct credit, or via EFTPOS or cheque to our trust account.

What happens if my tenant does not pay the rent?

Paying the rent is always a voluntary action on behalf of the tenant. We can never force a tenant to pay their rent. Even a tribunal can only ‘order’ a tenant to pay but can never physically force them to pay.

If a tenant does get behind in their rent payments, this is the process we follow:

4 Days in arrears – Courtesy call, sms or reminder letter/email to our customer.

8 Days in arrears – RTA Form 11 Notice to Remedy to Breach will be served on the tenants and a copy forwarded to the lessor for their records. The notice allows the tenant 7 Days to remedy the breach.

Expiry of the Form 11 – RTA Form 12 Notice to leave will be served on the tenants to terminate the tenancy and a copy forwarded to the lessor for their records. – The notice period for this is 7 Days.

Expiry of the Form 12 – Customer is to handover possession of the property to the Agent. Failure to do so may result in the agent lodging an urgent tribunal application for termination/warrant of possession.

Eviction

As you can see, the full legal process can be very drawn out and lengthy. Unfortunately the bond will never cover the shortfall in rent. Only if you have landlord insurance will there be a reasonable prospect of covering the rent payment shortfall, in the case of your tenant defaulting in their rent payments.

Without landlord insurance, the chance of recovering owed rent monies is minimal. If you have no protection for your rent payments, the problem is further compounded by the fact that the bond will probably be exhausted with owed rent. You will then most likely have cleaning up and re-letting costs, as well as outstanding monies like water usage owed by the tenant. Therefore without landlord insurance, this process can be quite financially damaging.

Inspecting Of My Property

Do you inspect the property at the beginning of a tenancy?

We conduct a comprehensive inspection of your property prior to the tenant moving in. We inspect your property area by area (lounge room, bedrooms, kitchen, front and rear yards, garage etc.) including all items present in each area (walls, ceiling, light fittings, floor coverings, curtains, windows, stove etc.).

We record the condition and cleanliness of each item and note a brief description and detail about the item. This would involve recording details of any marks, scratches and dents, etc. We also take photographs of the exterior (including yard) and also of the interior of the property (where required).

How often do you inspect the property during the tenancy?

We are allowed a maximum of four (4) inspections per year in accordance with legislative requirements. This inspection is not as detailed as the start of tenancy inspection. This inspection is more of a walk through, checking room-by-room that the tenant is keeping the property damage-free and reasonably clean. We will also take photos of the outside of the property, and any repairs or concerns observed.

Please note that due to privacy reasons we are unable to take photos inside the property showing the tenant’s belongings, and also we are unable to take any photos if the tenant refuses permission – this is in accordance with privacy legislation. We also note any repairs reported by the tenant, or observed by us and any other recommendations needed to assist you in keeping the property in the best condition possible. We send you a copy of the inspection usually within 2 days from the inspection date. If there are emergency items, we will forward the report to you as soon as possible.

What about when the tenant vacates the property?

When the tenant advises they will be vacating, we send them detailed information on our expectations of how the property needs to be presented when they leave. Once the tenant has fully vacated, we complete an exit condition report and compare this report to the one completed prior to the tenant moving into the property. We carefully check through the report item-by-item, ensuring it has been left in the same condition as when they moved in, taking into account reasonable wear and tear for the period of time they have been in the property.

This is a legislative requirement. We ensure the property has been left reasonably clean. Should you have a battery operated smoke alarm installed, it is a legal requirement that the battery be replaced by the Tenants upon end of each tenancy. It is the responsibility of the tenant to change the battery in the smoke detector during the tenancy. We check and also read the water meter (if the property is individually metered).

Taking a Bond

How much bond do you take from the tenant?

For both unfurnished and furnished premises the bond is set by legislation at a maximum of four (4) weeks rent.

When will the Bond monies be returned to the Tenant?

The bond is refundable only after the following has occurred:

a) The tenant has fully vacated the property and keys returned.

b) The property has been inspected, and is satisfactory when compared with the ingoing inspection report.

c) All monies are paid. This could be any outstanding rent, water or any other payments due from the tenant.

d) If the tenant is breaking their lease, any break fees have been recovered.

e) If, during the term of the tenancy, the standard of cleanliness has been unsatisfactory, the rent is in arrears, there has been damage or there are outstanding water rates, a claim for the bond will be made immediately to the RTA.

If the tenant has a pet, can I ask for an extra bond (a pet bond)?

Unfortunately no! We are legally only allowed to take one bond, as specified previously above. The maximum we can request is 4 times the weekly rent.

Tenancy Agreements

What do you explain to the tenants when they move into the property?

Considerable time is taken to explain to the tenants all of our expectations and the tenancy processes and procedures. For example, that they must pay their rent on the same day each week, methods of payment, and where to pay their rent. The rental arrears procedure, the repairs and maintenance policy, and what to do in an emergency repair situation is explained, along with inspection procedures, expectations and frequency of inspections. New tenants are given a Welcome Pack which contains an RTA Pocket Guide for Tenants and other relevant documentation.

What do they sign?

A Tenancy Agreement, which includes standard RTA and REIQ terms and conditions, is explained to the tenant prior to signing. A Bond Lodgement Form (Form 2) is also signed and a copy given to the tenant, along with a copy of the signed Tenancy Agreement. A copy of the signed Tenancy Agreement will be forwarded to you for your records.

The tenant also completes an Entry Condition Report, which must be signed and returned to Real Estate Mackay City within 3 working days. Lastly, tenants sign a copy of the key register to acknowledge receiving keys to the property and to ensure all keys are returned upon vacating the premises.

When do they get keys and possession of the property?

After all documents have been explained and signed, all bond monies and first payment of at least one fortnights rent received, we will then grant them the keys and possession of the property.

Repairing and Maintaining My Property

Who is responsible for repairing my property?

Under legislation, it is the responsibility of the landlord to keep the residential premises in a reasonable state of repair, considering the age of, the rent paid for and the prospective life of the property. We have a collection of tradespeople who have been used and evaluated and who offer value service.

Who is responsible for general wear and tear?

General wear and tear which occurs due to tenants living in a property is expected and legislation provides that it be allowed. A few extra marks and scuffs on the walls, some chips and scratches to doors and doorways will occur over time, along with the gradual wear of everything that is in the property.

The only time a tenant can be held responsible is if wear and tear is considered ‘excessive’ for the time frame that the tenant has been in possession. For example, a newly painted property with walls severely marked after 2 years resulting in the walls having to be painted again may not be allowed as ‘reasonable’ wear and tear.

In a Tribunal, this type of situation, if proven, could result in the tenant paying for the painting to be done, minus any depreciation for the age of the paintwork at that point in time when it was repainted again

What if the tenant is at fault?

If a tenant has caused damage to an item that is not the result of normal break down or wear and tear, this will be charged to the tenant. Normally, a tradesperson would let us know that the repair was normal or was influenced or caused by the tenant.

What about smoke alarms and light globes?

These are both a landlord responsibility at the commencement of every tenancy as governed by QLD Office of Fair Trading and Environmental Planning and Assessment Amendment (Smoke Alarms) Regulation 2006.

The QLD Residential Tenancies Act requires that tenants are responsible for the replacement of light globes as well as batteries in smoke alarms during their tenancy.

In accordance with legislation, prior to a tenant moving into a property we arrange for the alarms to be checked & certified as compliant. Alarms must be checked in this way every time a tenancy changes, or at each lease renewal.

What happens if a repair is required after hours, or on weekends?

The tenant is given Real Estate Mackay City’s phone number which is answered 24/7, so a tradesman can be contacted immediately to avoid further damage.

Who is responsible for maintaining the lawns and gardens?

Unless otherwise agreed, the tenant is responsible to maintain the lawns and gardens to the standard they were given at the start of the tenancy. If the property is provided with watering systems these need to be working and kept maintained during the tenancy.

What about cleaning the roof gutters and pruning?

From an insurance perspective it is wise for it to be a landlord’s responsibility to ensure these are done. Of course, we can arrange contractors on your behalf to do these for you.

Renewing the Lease with My Tenant

Who decides if the lease will be renewed?

You do! We will contact you by letter before the lease is due, and seek your instructions if you wish to renew or not renew the lease. Once we have your approval we will then approach the tenant to have the lease renewed. We try to have the lease renewed within two months of their agreement ending.

If I do not wish to renew the lease, do I have to give a reason?

If you do not wish for the lease to be renewed you are not obligated to give your tenant a reason.

Notice Required When My Tenant Is Vacating

How much notice must my tenant give when they want to vacate the property?

The tenant may give 14 days’ notice in writing to vacate at the end of the fixed term of the Tenancy Agreement. Once the fixed term of the Tenancy Agreement has expired, the tenant is required to still give 14 days’ notice in writing if they want to vacate.

Breaking of a Fixed Term Lease

Who pays for the letting fee and advertising costs when a tenant breaks their fixed term lease?

Unfortunately we have no control over the tenant breaking their lease early. If the tenant wants to break their fixed term lease and vacate early, the following requirements will apply:

  1. The tenant is responsible for payment of their rent until a new tenant is secured or to the expiry date of the lease, whichever comes earliest.
  2. Any advertising costs and the agents re-letting fee must be paid by the vacating tenant.

Breaches of Tenancy

What happens if the tenant breaks one or more of the conditions of tenancy?

The action taken depends on what has occurred. If the breach is minor approaching the tenant verbally or in writing may be appropriate. If it is something serious we will consult with you first to discuss what action to take.

Serious breaches of tenancy may involve using the property for illegal purposes or bringing in pets without prior permission, etc. We will advise you if we intend to serve a Termination Notice on the tenant or use a more diplomatic means to rectify the breach if possible. It will be necessary to give the tenant 14 day’s notice if a Termination Notice is required.

Landlord Insurance

Why do I need landlord insurance if I have an agent?

We at no time can guarantee your tenant’s performance whilst renting your property. The risk belongs to the owner of the property, and therefore the owner should be insured for such a risk. Real Estate Mackay City strongly suggest, for their own protection, that the owner ensure they are fully and adequately insured.

Why do I need landlord insurance if I have a good tenant?

Even a good tenancy can turn bad. If the tenant’s circumstances change sometimes the tenancy will become unstable. This can result in rent owing and the property not being maintained sufficiently. It pays to be properly insured, even with a good tenant.

What does landlord insurance cover?

Landlord insurance will cover rent loss due to tenant default and malicious damage to the property caused by the tenant. It is important for you to know what your landlord insurance policy will and won’t cover. Please consult with your landlord insurer so that you are fully aware of the extent of your cover and also any excesses that may be applicable in the event of a claim.

Smoke Alarms

What type of smoke alarm should be fitted?

We always ask that a hard-wired smoke alarm be fitted to all rental properties; due to the high chance of a tenant tampering with a removable battery powered alarm (9-volt battery powered alarms) and onerous obligations imposed upon landlords under the Residential Tenancies Act who install 9 volt battery powered alarms.

In the case where a hard-wired smoke alarm cannot be fitted, then it is recommended that a 10 Year Lithium Battery Operated alarm be installed. This type of alarm is easily fitted like a 9-Volt type alarm, but the 10 Year Lithium alarm has a battery sealed inside that cannot be removed. The Environmental Planning and Assessment Amendment (Smoke Alarms) Regulation 2006 specifies the type of alarm to be installed and its location.

In accordance with legislation alarms must be compliant prior to a tenant moving into a property, and inspected every twelve months, or at the expiry of a six month lease and at every change of tenancy. We have secured the services of a Compliance Technician who will check the alarms in a property for a cost of $28 and if a basic alarm needs to be replaced, will do so for an extra cost of $10. (The cost may be increased if a property is located outside of a 14km radius of Mackay City) All hardwired alarms must be replaced by a qualified electrician.

Pest Control Services

Should I get my property regularly checked for termites?

Yes! We strongly recommend all of our clients choose a pest control service and request that they regularly check your property for termite activity at the frequency they recommend. Unfortunately we do not contract them to do this on your behalf, unless you specifically instruct us in writing to do so each time it is required.

Please note, it is a general exclusion of all building insurance policies that damage to your property caused by termites is not covered (not insurable). Therefore regular checking is the best way to prevent termite damage, or at least attempt to identify warning signs that termites are creating damage. Without regular check-ups the damage could be substantial and very costly to rectify.

Costs Incurred At My Rental Property

Who pays for electricity and/or gas charges?

These are normally a tenant’s expense. However, if there are charges relating to the supply of these services to a property, then the supply charges are at the landlord’s cost. A good example is if a property has bottled gas supplied. The tenant pays for the gas in the bottles; however the landlord would be responsible for the charges related to the gas bottle rental. This is a charge associated with the supply of the gas.

Also, if you are moving out of your property and you have your own gas bottles remaining, please remove them. There is a high chance that these bottles will be accidentally removed by a gas bottle supply company, providing grounds for an avoidable dispute with your tenant regarding missing gas bottles. Let the tenant arrange their own rental bottles. This must be disclosed to any intending tenant when viewing your property and a special condition clause inserted in the Tenancy Agreement to avoid any disputes.

Who pays for water charges?

Water usage charges can be charged to the tenant for all water used during the tenancy where the property is separately metered. The water usage charge will appear on your water rate notice. The property must comply with strictly defined water efficiency standards to be able to charge the tenant for water usage. All internal cold water taps and single mixer taps (including showers) must have a maximum nine (9) litre flow rate and there must be no leaking taps at commencement of the tenancy.

Bath tub taps, taps for appliances such as dishwashers, hot water systems, washing machines, single hot water taps, toilets and garden taps are exempt. In most cases where gardens and lawns are involved, the landlord can elect whether to recover the full cost of water used by the tenant or apportion the amount according to the care of the lawns and gardens. Some landlords wish to charge the tenant all water costs. This is optional; however we do believe that an incentive should be given to the tenant to ensure the garden remains healthy.

How do you calculate what water charges the tenant has to pay?

Water usage is not levied by water authorities to tenants on a separate rate notice. Usage charges appear on and form part of your water rate notice. Should you wish to charge the tenant for water used during the tenancy please send us a copy of the front and back pages of your rate notice as soon you receive it, and we will charge the tenant for the water used during that rating period.

Please note that under QLD legislation, to recover water usage charges from the tenant, the charge must be levied on the tenant within 90 days of receipt of the rate notice. We will record the water meter reading on the ingoing inspection report at the start of the tenancy. Upon receipt of your water rate notice as detailed above we will calculate the metered water used and will charge the tenant accordingly. As required by legislation, tenants can only be charged for metered water used.

At the end of the tenancy we will record the water meter reading and charge the tenant for water used since the last rate meter reading detailed on your water rate notice.

We ask the owner to pay this account and once you have paid it forward both side of the page and we will invoice the tenants (reason if not paid by the due date the council will not allow your discount)

What about council and sewerage rates?

All these costs must be paid by the landlord as specified by legislation. However, any charges for excess rubbish or sanitary charges and any charges for pumping out a septic system can be charged to the tenant.

Receiving My Financial Statements

We will issue you fortnightly, monthly and yearly financial statements, accounting for all monies we have handled and disbursed to you on your behalf in accordance with legislative requirements. You will receive your monthly statements together with any tax invoices from tradespersons or other disbursements paid during that month on your behalf. Your end of year statement accounts for all monthly statements accumulated, for accountancy ease.

When do I receive these statements?

Your monthly statement will be emailed or posted to you (via the method of your choice) on approximately the 16th and first working day of every month, and the end of year statement will come to you in July of each year being the month immediately following the end of the financial year.

How do I understand these statements?

If you do not understand how to read the statements, or are confused about any matter our staff are here to help, so please contact us to discuss your query.

What if I misplace a statement?

All statements are numbered, so if you are missing any, contact us and we will issue a replacement.

Selling or Moving Back Into My Property

What happens to the tenancy if I wish to sell my property?

You may sell your property at any time. However, any fixed term lease in place is guaranteed to your tenant. This means if a person buys your property and they wish to occupy it, they must wait until the fixed term has expired, unless the tenant agrees otherwise. If the tenant agrees to move out early they may seek some form of compensation.

What if I, or someone from my family wants to move in to my rented property?

Again, any fixed term lease is guaranteed unless the tenant agrees to move out early. As is the case with the property being sold, this usually involves an amount of compensation being paid to the tenant as agreed by both the landlord and the tenant.

What if the Agreement has expired?

If the tenants are in an expired agreement, you may give them notice to vacate the property. You may give them a minimum 60 days’ notice where the property has been sold (contracts exchanged) and the purchaser requires vacant possession.

Can you sell my property on my behalf?

Of course! Selling your property is part of the service we provide. It is always preferred that we sell your property. It is much easier to coordinate access with the tenant between the sales and rental departments if you are using the same agency for both services. Your tenant will also be more comfortable dealing with a company they are already familiar with. Just let us know if you want to sell, even if you are just thinking about it.

We must give the tenants fourteen (14) days’ notice of intention to sell the premises before the property is made available for inspection. The tenant is not required to give access more than twice a week and must be given 24 hours notice of an impending inspection.