If you have not yet herd, the tenancy industry is soon to get three new changes to the Residential Tenancies Act.
Meth contamination, tenants not having to pay for carless damage, and landlords renting out homes that don’t meet basic health and safety requirements are the three biggest issues in the industry at the moment. This bill looks at putting common sense back into legislation. Making tenants responsible for damage they cause, updating the meth contamination standards, and increasing the standard expected in a rental home.
Scotney Williams, and the team at TPS outline the changes here:http://tenancynews.co.nz/meth-osaki-and-poor-landlord-behaviour-tackled-in-big-changes-to-rta/
The more the industry is regulated, the better the industry becomes, as less cowboy property managers and DYI landlords get away with cutting corners to save time and a few bob. Give us a call, and get professional, stress-free property management for your investment property.
A good property manager will manage your property, and also your investment. I own a rental property, and my own house. I know how hard it is to buy a house, let alone two of them. I have a lot of respect for investors with several properties. But, I often see owners cut spending on essential costs required to protect their investment.
The first three costs after interest on your mortgage and your council rates, should be on some solid landlord insurance. You can get landlord insurance from your building insurer, which will have a general cover. But their excess is usually $1000 for general claims. If you own a rental in the rougher area’s of Auckland, then talk to your property manager about getting separate landlord insurance, which will only be available through a property manager. This will have better cover for loss of rent, intentional tenant damage and even pet damage. The excess is usually one weeks rent.
The second cost is for a good property manager. With more regulations around rental properties, the cost of a property manager is less than the stress and the fines owners can get for doing things outside of the law. And some times things that seem like common sense for owners, can be illegal according to the Residential Tenancies Act. As tenants have rights to the property. Also, tenants can get away with more than they should with some owners, as they do not have the tools and knowledge of the act to use the system to their advantage.
The third is doing general maintenance noted in inspections, and they should be set out in a annual budget. This includes clearing gutters, trimming trees, fence maintenance, roof maintenance etc. Some of my clients have not approved clearing gutters over their routine inspections, which has resulted in roof leaks after the heavy rain we had in Auckland. And caused damage to ether the carpets or tenant furniture. This leads to insurance claims and further costs. Keeping your property well maintained, reduces stress, attracts the best tenants, and protects your investment.
To your success!
During January and December, rental arrears is usually the biggest problem. This time of year, tenants have over spent during Christmas and New Years. Or they have had hardship, as it can be difficult for low income families to get through this time of year.
- Planning ahead of time. The first thing that you can do to keep control of rent arrears during this period, is looking ahead. In November we would send all our tenants a letter to wish them well over the Holiday Season. I’d also remind them that if anyone falls into rent arrears, strict procedures will be taken to manage this issue with the tenancy tribunal involved every time. This alone should discourage those that plan not to pay rent for the week of Christmas, and play catch up in January.
- Issue a 14 day notice. With a large caseload, rent arrears should be monitored daily. Anyone on my 7 day’s + list instantly gets a 14 day notice to remedy the rent arrears. This is a hardline approach, but it gets them to contact me, which starts the conversation about how they can repay the amount owing.
- Make a tribunal application. Before the 14 day notice is posted, and emailed. I would make my Tenancy Tribunal Application on the same day. You don’t have to wait for the 14 day notice to run out. It can be done on day one of the 14 day notice.
- Repeat steps 2 and 3. Every day, especially during December and Jan, time needs to be put aside to check rent arrears and issue the 14 day notices and make tribunal applications. This took more time that I would have liked, but it has helped keep control of the arrears outstanding.
When February comes round, I will be busy with mediation appointments. During these mediations, I would agree to no less than $50 extra per week for rent arrears, plus the full weeks rent. This would be due on a set day each week. With an eviction clause effective if rent was not paid on the due date. One of my tenants may get evicted using the eviction clause each year.
Some tenants will not make it to mediation, and the application will be sent to court. By the time you get a court date, it could be the end of Feb, early March. If tenants ended up in court, I would be asking for termination. Unless the courts see that the tenants can actually pay the full amount due. They will grant you vacant possession, and refund the bond to cover any rent arrears. One or two of my tenants will go through this process each year.
Getting vacant possession of the house may require a bailiff. This can be applied for separately through the courts using the order for vacant possession. Once you get vacant possession, change the locks and do your final inspection. This is where you can make a further application to the tenancy tribunal for vacated costs, which can include the change of the locks, cleaning, rubbish removal, and repairs.
By March/ April, things will be back to normal again.
If you would like to talk about property management, please don’t hesitate to contact me.
The one thing that all different races, and all religions agree on is economic growth. The finer details on how to achieve that goal of growth can differ, but the ultimate goal, we can all agree on. This could be the underlying reason capitalism has become the backbone of most, if not every economy on earth today. It’s the one thing you can always have in common with someone you don’t know. And thus, we can do business with strangers.
In my quest to grow the business I am in, I need to identify the customers who provide me with the most value, and the customers whom give me the least value. Often times, I find the lower value customers are costing me the most time and effort. These are the customers I will need to remove from the business. While the higher value customers are the easiest to please, because they need me just as much as I need them. These customers are where I can invest more time and effort into building deeper relationships and gaining more business through their trust and loyalty.
This means I’ll be going against the trend of growth in the short term, which is scary, but if my plans work out, it should free up more time for medium to long term growth, and happier customers overall.
The 80/20 rule, stays true. A good exercise to do, is to apply the 80/20 rule to other areas of life, and cut the low value/ high cost activities. Take running for example. I run for 20 minutes, twice a week. Which is very little compared to what I used to do. But it accounts for a huge part of my wellbeing. I owned 10% of my house when I purchased it, but its accounted for the majority of the growth in my wealth over the years I have owned it.
What are the activities I need to do to succeed? If I can increase those activities buy a small margin, I am sure the rewards will be close to 80x the effort put in.
In property management, Christmas is a difficult time for tenants, if you work in the lower income areas. The cost of Christmas, combined with the days off, means hourly workers don’t get paid. This often means working extra hours leading up to Christmas and New Years, just to make it through.
This time of year we send out letters to thank the tenants for a good year, and remind them that rent is still priority number one when it comes to their fixed costs.
To encourage the spirit of giving, I invite landlords to donate a shopping voucher worth at least $100 for their tenant, if they have been reasonably good with rent payments and house keeping. This small act of giving has often brought tears to the eyes of the recipient. It also encourages good faith, and reduces the risks of a rental payment being missed. The effect this $100 has, is absolutely priceless.
Brendan Burchard wrote “As I walk the path of Gratitude, I arrive at the home of Happiness”
Often times, I forget to be thankful for everything I have. Today I will be grateful, and giving 🙂
In todays world of endless notifications, emails, texts, phone calls, and interruptions, it’s easy for important tasks to fall through the cracks, and for your rhythm to be drowned out by the background noise. You can become super busy, and yet produce very little.
In property management we get calls, texts and emails, upon calls, texts and interruptions. Tasks often become overlapped, and it’s easy to forget what you were doing in the first place. In todays world, this wont cut it if you want to make a real difference.
I survive by setting 3 main priorities, which stay the same every day. They relate to my KPI’s. This can be rent arrears, letting, and new business. This sets the melody for each day. I also have a note book on my desk, and I use my calendar to record each beat of the moment. Together, these create my working rhythm. It helps me take note of the real work, and identify the time wasting tasks which always seem urgent, but of little importance. Once you find your working rhythm, then you can tango with passion, and grab that bull by the horns!!
Im meeting an owner of 10 rental properties next week, and he has given me the gift of his time. I am very excited about this, by lending his ear and mind to me, he is allowing me to influence his next few decisions. The feelings I can covey to him will have more influence than any words that come out of my mouth.
I have already predetermined the outcome of our meeting… He will like me, and I will get his business! Thats why I’m going to be so happy to meet him! He, will be wondering… why is this guy so happy??… I should be more happy too. Then I will be grateful and “sound” grateful. He will start to realize that he has so much to be grateful for also, and start feeling grateful for all his properties. By the end of the meeting, he wont remember the words I said. But he will remember the way I made him feel.
The sounds, pitch, volume, melody I use in my conversation will influence him way more than the words that come out of my mouth. I learnt this from Roger Love.
Im so thankful that I came across “Roger Love” this morning online. He’s the worlds #1 voice trainer! If your success depends on people listening to you, then check him out here: http://brendon.mykajabi.com/p/rogerlove-speakingtips
Or here: http://theperfectvoice.com/