I recently joined a couple of properly management forums and got into a conversation on the best way to sign lease agreements and managing lease renewals.
What I found was one agency said that they only sign 6 months leases for all of their properties. When asked why, their response was that it is a part of their company procedure. Their reasoning to the owners was that 6 month leases allow the agency and the owner to evaluate the tenant during their tenancy to ensure they are the right candidates for the property and that they can be relied upon to pay their rent and manage the property?s upkeep.
This does make a lot of sense in determining the reliability of the tenant, but there are other ways to review your tenants. In Queensland, property managers are allowed to conduct inspections four times per year. If your agent is doing these inspections, this should give you a good indication of the tenants? behaviour and their treatment of the property. In addition, the agency should be doing proper background checks and asking for references from previous agencies before the tenant sets foot in the property.
So why are these agencies only signing 6 month leases?
When I asked for further reasoning, they responded that they charge for a lease renewal of one week?s rent. This offers a big advantage to the agency, as this process not only guarantees them not only your management fees, but an additional two weeks rent.
are you being charged for this?
If you check your PAMD 20a, the management agreement, and the lease renewal fee is not stated or outlined, your agency cannot charge that fee.
Sometimes the best advice can have hidden reasons behind it.
What I found was one agency said that they only sign 6 months leases for all of their properties. When asked why, their response was that it is a part of their company procedure. Their reasoning to the owners was that 6 month leases allow the agency and the owner to evaluate the tenant during their tenancy to ensure they are the right candidates for the property and that they can be relied upon to pay their rent and manage the property?s upkeep.
This does make a lot of sense in determining the reliability of the tenant, but there are other ways to review your tenants. In Queensland, property managers are allowed to conduct inspections four times per year. If your agent is doing these inspections, this should give you a good indication of the tenants? behaviour and their treatment of the property. In addition, the agency should be doing proper background checks and asking for references from previous agencies before the tenant sets foot in the property.
So why are these agencies only signing 6 month leases?
When I asked for further reasoning, they responded that they charge for a lease renewal of one week?s rent. This offers a big advantage to the agency, as this process not only guarantees them not only your management fees, but an additional two weeks rent.
are you being charged for this?
If you check your PAMD 20a, the management agreement, and the lease renewal fee is not stated or outlined, your agency cannot charge that fee.
Sometimes the best advice can have hidden reasons behind it.