Landlords in WA about to be done over - Residential Tenancies Amendment Bill 2011

[HotRod]

In the 10 years as a LL I have neither read the RTA nor gone to any tribunal.

I don't vet tenants, never do inspections or do any repairs.

And I've had no problems.

Seems a lot of people's troubles can be resolved with a good PM.

These people should have had training in PM and thus know the RTA and it's ins and outs and there should be a senior manager in the agency that will guide younger staff.

As a minimum as a LL paying a PM you should reveive a copy of a routine inspection report every 3 months. Also, you should authoise the PM that they can spend up to say $250 per month for a single repair up to say $500 (or whatever you decide) so that you don't need to worry about that. You should just get copies of paid repairs attached to the rental statement each month.

 

[Burbs]

There is a lot of good discussion on this thread, beneath the hyperbole.

From my viewpoint, the RTA is fundamentally flawed and encourages smart capital to leave the sector and invest elsewhere. A couple of examples:

1. Bond is Never Enough: when the tenant stops paying the rent (not if) the earliest a Form 1B termination notice can be issued and expire is Day 13. Then there is an average 21 day wait for a court hearing. So the fastest timeframe for your day in court is 34 days. But you only have a maximum of 28 days bond. And that is rent arrears only. There is no protection for your legal costs, the bailiff, the re-keying, the broken window, the punch holes in the door, the missing lightglobes, the general cleaning, the carpet cleaning, the skip bin and the labour to fill the skip bin.

2. No Appeal Provisions - the magistrate may make pretty much any determination he/she feels fit to use. I have seen several tenant appeals accepted, usually for stays of execution on evictions; however the owner has no right of appeal except for a 'denial of natural justice' which requires application to the supreme court which is very expensive and in the one case I am aware of was denied as the court held a very narrow view of natural justice and did not allow it to be used to look at the fundamentals of the case. The lack of appeal provision means that NO magistrates decision is accountable and there is no development of case law.

3. Fines - 30 new fines for owners, 2 new fines for both owners and tenants, zero new fines for tenants. Yet who most commonly defaults on a tenancy agreement? The tenant of course! Simply read the public notices section of the West Australian any Thursday and you will see two columns listing upcoming residential court hearings, around 100 per week. Read the descriptions - rent arrears, property damage, unpaid water consumption, the usual culprits. But don't worry, the new RTA has a $20,000 fine for an owner who fails to hand over a copy of the bond form ( s29(a)(4)(d) ).

Yours in resiland,

Burbs

PS as for the comment that someone made that most of these issues could be prevented by good PM, is that a joke? Have you ever had a tenant spit in your face, hit you, and tell you they are going to destroy your house? And the police refuse to do anything, and the tenants actually destroy the house? And never pay for anything of course. What about tenants killing a dog and leaving it to rot at the house. What about tenants ringing you up and saying they are going to kill you? What about tenants crying in front of the magistrate to get an extension on an eviction, and then threatening you in the lift on the way down...

 

[Belbo]

There is a lot of good discussion on this thread, beneath the hyperbole.

From my viewpoint, the RTA is fundamentally flawed and encourages smart capital to leave the sector and invest elsewhere. A couple of examples:

1. Bond is Never Enough: when the tenant stops paying the rent (not if) the earliest a Form 1B termination notice can be issued and expire is Day 13. Then there is an average 21 day wait for a court hearing. So the fastest timeframe for your day in court is 34 days. But you only have a maximum of 28 days bond. And that is rent arrears only. There is no protection for your legal costs, the bailiff, the re-keying, the broken window, the punch holes in the door, the missing lightglobes, the general cleaning, the carpet cleaning, the skip bin and the labour to fill the skip bin.

2. No Appeal Provisions - the magistrate may make pretty much any determination he/she feels fit to use. I have seen several tenant appeals accepted, usually for stays of execution on evictions; however the owner has no right of appeal except for a 'denial of natural justice' which requires application to the supreme court which is very expensive and in the one case I am aware of was denied as the court held a very narrow view of natural justice and did not allow it to be used to look at the fundamentals of the case. The lack of appeal provision means that NO magistrates decision is accountable and there is no development of case law.

3. Fines - 30 new fines for owners, 2 new fines for both owners and tenants, zero new fines for tenants. Yet who most commonly defaults on a tenancy agreement? The tenant of course! Simply read the public notices section of the West Australian any Thursday and you will see two columns listing upcoming residential court hearings, around 100 per week. Read the descriptions - rent arrears, property damage, unpaid water consumption, the usual culprits. But don't worry, the new RTA has a $20,000 fine for an owner who fails to hand over a copy of the bond form ( s29(a)(4)(d) ).

Yours in resiland,

Burbs

PS as for the comment that someone made that most of these issues could be prevented by good PM, is that a joke? Have you ever had a tenant spit in your face, hit you, and tell you they are going to destroy your house? And the police refuse to do anything, and the tenants actually destroy the house? And never pay for anything of course. What about tenants killing a dog and leaving it to rot at the house. What about tenants ringing you up and saying they are going to kill you? What about tenants crying in front of the magistrate to get an extension on an eviction, and then threatening you in the lift on the way down...

So you've met my mother-in-law then . . . .

 

[Ideo]

There is a lot of good discussion on this thread, beneath the hyperbole.

From my viewpoint, the RTA is fundamentally flawed and encourages smart capital to leave the sector and invest elsewhere. A couple of examples:

1. Bond is Never Enough: when the tenant stops paying the rent (not if) the earliest a Form 1B termination notice can be issued and expire is Day 13. Then there is an average 21 day wait for a court hearing. So the fastest timeframe for your day in court is 34 days. But you only have a maximum of 28 days bond. And that is rent arrears only. There is no protection for your legal costs, the bailiff, the re-keying, the broken window, the punch holes in the door, the missing lightglobes, the general cleaning, the carpet cleaning, the skip bin and the labour to fill the skip bin.

2. No Appeal Provisions - the magistrate may make pretty much any determination he/she feels fit to use. I have seen several tenant appeals accepted, usually for stays of execution on evictions; however the owner has no right of appeal except for a 'denial of natural justice' which requires application to the supreme court which is very expensive and in the one case I am aware of was denied as the court held a very narrow view of natural justice and did not allow it to be used to look at the fundamentals of the case. The lack of appeal provision means that NO magistrates decision is accountable and there is no development of case law.

3. Fines - 30 new fines for owners, 2 new fines for both owners and tenants, zero new fines for tenants. Yet who most commonly defaults on a tenancy agreement? The tenant of course! Simply read the public notices section of the West Australian any Thursday and you will see two columns listing upcoming residential court hearings, around 100 per week. Read the descriptions - rent arrears, property damage, unpaid water consumption, the usual culprits. But don't worry, the new RTA has a $20,000 fine for an owner who fails to hand over a copy of the bond form ( s29(a)(4)(d) ).

Yours in resiland,

Burbs

PS as for the comment that someone made that most of these issues could be prevented by good PM, is that a joke? Have you ever had a tenant spit in your face, hit you, and tell you they are going to destroy your house? And the police refuse to do anything, and the tenants actually destroy the house? And never pay for anything of course. What about tenants killing a dog and leaving it to rot at the house. What about tenants ringing you up and saying they are going to kill you? What about tenants crying in front of the magistrate to get an extension on an eviction, and then threatening you in the lift on the way down...

What was that about hyperbole again?

 

[Burbs]

If you feel that is hyperbole, you have not dealt with enough tenants...

 

[Belbo]

From my viewpoint, the RTA is fundamentally flawed and encourages smart capital to leave the sector and invest elsewhere. ...

Hi Burbs,

No, that was a really good post of yours. I suspect you've actually stumbled onto a deeper truth in the above sentence too: The RTAs are perhaps meant to be an investment disincentive. All part of a slow heating of the frog's water sort of strategy?

 

[Ideo]

If you feel that is hyperbole, you have not dealt with enough tenants...

Potentially.

I also feel that they are very strong negative experiences which you are passing off as something that most, if not at all, will experience.

The very definition of hyperbole.

 

[Burbs]

The statement about if, not when a tenant stops paying, is fact not hyperbole. At any particular time around 8% of resi tenants are in default. It peaks around Christmas, some years getting over 20%. Around 65% of tenants will default on rent at some stage during their tenancy.

The $20,000 fine is one of many new fines for owners under the Act.

The tenant experiences are all genuine and my own. I have plenty of others. An individual with 1 or 2 rentals may never experience them. However given enough time or properties, and the experiences will come.

Burbs

 

[HotRod]

Of the 8%, how many a self managed?

 

[Magnum9]

I wonder how that 8% compares to commercial defaults, e.g. Synergy or Alinta, every customer sent a reminder notice is technically in default.

 

[Ideo]

The statement about if, not when a tenant stops paying, is fact not hyperbole. At any particular time around 8% of resi tenants are in default. It peaks around Christmas, some years getting over 20%. Around 65% of tenants will default on rent at some stage during their tenancy.

The $20,000 fine is one of many new fines for owners under the Act.

The tenant experiences are all genuine and my own. I have plenty of others. An individual with 1 or 2 rentals may never experience them. However given enough time or properties, and the experiences will come.

Burbs

Got a link for those stats? And what do you view as a default.

But even taking that stat as gospel, it is not a statistical certainty like you make out. Hence, hyperbole.

The fine is a maximum. Not the automatic fine. Hence hyperbole.

If I had a run of things like that I'd look at my business practices.

But I agree it's not a big part of what I so except one property. The others are tenated until they get rezoned or da approved.

 

[Dazz]

That's what drives me so insanely nuts about you Ideo.

You are a mere babe in woods when it comes to property experience and being a Landlord.

Burbs would have many many times over the Tenant years that you have under your belt, and yet you blow him off with your childish retorts like some petulant 14yo girl.

You are in that blissfully ignorant "I don't know what I don't know" zone.....but assume your normal wilfully ignorant tactics will work all the same. They don't.

If Burbs was a property elephant, you aren't even a cockroach underfoot. To read the absolute drivel spewing forth from you, up against his real life experiences is infuriating to say the least.

Give it a rest - you've got such a shallow base to draw upon, you've got nothing worthwhile to contribute.....as can be seen from your peurile posts in this thread. How embarrassment !!

Thanks Burbs for your contribution....much appreciated.

 

[Ideo]

That's what drives me so insanely nuts about you Ideo.

You are a mere babe in woods when it comes to property experience and being a Landlord.

Burbs would have many many times over the Tenant years that you have under your belt, and yet you blow him off with your childish retorts like some petulant 14yo girl.

You are in that blissfully ignorant "I don't know what I don't know" zone.....but assume your normal wilfully ignorant tactics will work all the same. They don't.

If Burbs was a property elephant, you aren't even a cockroach underfoot. To read the absolute drivel spewing forth from you, up against his real life experiences is infuriating to say the least.

Give it a rest - you've got such a shallow base to draw upon, you've got nothing worthwhile to contribute.....as can be seen from your peurile posts in this thread. How embarrassment !!

Thanks Burbs for your contribution....much appreciated.

All I'm asking is proof of statistics which are surprising to me and addressing the hyperbole issue.

If there is facts I'll be surprised but accept it.

But, like you I don't really do long term residential for reasons posted in this and other reasons. I make much better money from rezonings and da approved sales.

So come on. Post facts. I've googled and haven't found anything yet. The 65% surprises me. So get some facts and back it up.

Or just do your usual trick of posting snide comments and then ignoring any further questions. Rinse. Lather. Repeat. It's getting boring.

 

[thatbum]

That's what drives me so insanely nuts about you Ideo.

You are a mere babe in woods when it comes to property experience and being a Landlord.

Burbs would have many many times over the Tenant years that you have under your belt, and yet you blow him off with your childish retorts like some petulant 14yo girl.

You are in that blissfully ignorant "I don't know what I don't know" zone.....but assume your normal wilfully ignorant tactics will work all the same. They don't.

If Burbs was a property elephant, you aren't even a cockroach underfoot. To read the absolute drivel spewing forth from you, up against his real life experiences is infuriating to say the least.

Give it a rest - you've got such a shallow base to draw upon, you've got nothing worthwhile to contribute.....as can be seen from your peurile posts in this thread. How embarrassment !!

Thanks Burbs for your contribution....much appreciated.

Jesus christ. At least some of the other flak going around this thread has some content in them - that was just an outright personal attack.

If you disagree with him, you can at least be civil about it. I wonder if its a coincidence that the most argumentative posters seem to have the most problems with tenants.

 

[HiEquity]

Jesus christ. At least some of the other flak going around this thread has some content in them - that was just an outright personal attack.

If you disagree with him, you can at least be civil about it. I wonder if its a coincidence that the most argumentative posters seem to have the most problems with tenants.

And so did you have a response to Burb's excellent points?

Or any plan to recover funds, in lieu of your assertion that higher bonds aren't realistic, from a tenant who has done a runner and left no forwarding address and doesn't care about their credit record? And please don't say landlord insurance - that costs LLs money too! Unless you agree that tenants should pay for it of course, as most do for insurance in industrial properties. Why not for resi?

In any case, allowing LLs to charge higher bonds doesn't mean everyone will - it's a free world (or it would be if such things were actually permitted...). If a tenant doesn't have the readies for a higher bond they can offer to pay a higher than market rent to compensate the LL for the risk. If they can't afford the higher rent they should move somewhere they can afford so as to avoid an unsustainable situation developing. It's a win/win/win...

And I still haven't heard a good reason why court orders can't be enforced in the same way the ATO enforces recovery of taxes (e.g. garnishment - they've got a really beautiful system going...). If it has been ordered by a court then it should be enforced in the absence of a successful appeal.

 

[Belbo]

Ah, don't let Dazz bother you, Thatbum.

He's just our resident Silverback. His basic position from what I can muster is that everything went to crap with the overthrow of King Charles I. Quite mad actually; but there you have it. If you just stay out of reach of his vicious personal attacks, a gentle mocking tone's all that's generally needed to send him back to his thickets to fume.

 

[HiEquity]

Fairness...

BTW the other thing that really bothers me is the concept of "fairness" that keeps getting invoked.

If I look at unregulated industrial property tenancies I find when massive multinational companies with huge corporate power deal with two dollar landlords with relatively inconsequential wealth their leases often:
- Provide excellent money at risk from the tenant, often in the LLs bank account
- Are of decent duration with rent reviews etc locked in
- Pay for all outgoings including property mgt, insurance, rates, land tax etc etc etc
- Include provisions saying that late payment of rent is grounds for immediate eviction.

So despite the fact that the multinationals hold all the power and the LLs hardly any, the parties have still agreed these, as well as many other similar provisions, to be "fair".

Yet it has to be completely different (completely the opposite in fact) in residential to be "fair". The LL has to pay for everything and the tenant hardly has any money at risk. Even if the tenants are significantly more wealthy than the LL. How is this "fair"?

Fairness should be determined by the market. Not by tenant advocates...

 

[thatbum]

And so did you have a response to Burb's excellent points?

Or any plan to recover funds, in lieu of your assertion that higher bonds aren't realistic, from a tenant who has done a runner and left no forwarding address and doesn't care about their credit record? And please don't say landlord insurance - that costs LLs money too! Unless you agree that tenants should pay for it of course, as most do for insurance in industrial properties. Why not for resi?

In any case, allowing LLs to charge higher bonds doesn't mean everyone will - it's a free world (or it would be if such things were actually permitted...). If a tenant doesn't have the readies for a higher bond they can offer to pay a higher than market rent to compensate the LL for the risk. If they can't afford the higher rent they should move somewhere they can afford so as to avoid an unsustainable situation developing. It's a win/win/win...

Yeah I actually do, which I've partly already given in my previous posts. I don't mind starting again though.

1. Bond is never enough: I don't know how those days were calculated because a Form 1B termination notice only needs 7 days. Its not an average 21 day wait for a first court date either - that would be a maximum, and only at the regional courts that have one day a week for tenancy. The application only needs 14 days for service, and at Perth Magistrates Court, with multiple tenancy listing days, it would be a couple days after that at the most.

Apparently during all this time, the tenant is smashing everything up in the house... for no apparent reason. I'll be honest and say I don't have an answer for that, but as I previously mentioned, I probably disagree with some people about how often this actually occurs.

2. No appeal provisions: I don't even understand what exactly the complaint is here. You're saying there's no appeals but apparently there are for tenants? Its the same provisions for appealing that apply for both tenants and landlords - theres definitely no distinction between either party.

3. Fines: I have literally never heard of an actual landlord being fined under the RTA. Consumer Protection and their relatively small prosecution team have better things to do apparently. In two years of working in the area, I've only heard of one PM being fined, and it was for something ridiculously blatant like not lodging the bond and not complying with a court order or something like that.

 

[HiEquity]

Apparently during all this time, the tenant is smashing everything up in the house... for no apparent reason. I'll be honest and say I don't have an answer for that, but as I previously mentioned, I probably disagree with some people about how often this actually occurs.

Does it matter how often it happens? As you state here...

Fines: I have literally never heard of an actual landlord being fined under the RTA. Consumer Protection and their relatively small prosecution team have better things to do apparently. In two years of working in the area, I've only heard of one PM being fined, and it was for something ridiculously blatant like not lodging the bond and not complying with a court order or something like that.

...this never happens and yet there are provisions galore in the RTA about it.

I can guarantee that malicious or negligent tenant damage happens far more often than the stuff above that would warrant the LL being fined. Maybe there should be some real, enforceable provisions about it then hey?

 

[thatbum]

BTW the other thing that really bothers me is the concept of "fairness" that keeps getting invoked.

If I look at unregulated industrial property tenancies I find when massive multinational companies with huge corporate power deal with two dollar landlords with relatively inconsequential wealth their leases often:
- Provide excellent money at risk from the tenant, often in the LLs bank account
- Are of decent duration with rent reviews etc locked in
- Pay for all outgoings including property mgt, insurance, rates, land tax etc etc etc
- Include provisions saying that late payment of rent is grounds for immediate eviction.

So despite the fact that the multinationals hold all the power and the LLs hardly any, the parties have still agreed these, as well as many other similar provisions, to be "fair".

Yet it has to be completely different (completely the opposite in fact) in residential to be "fair". The LL has to pay for everything and the tenant hardly has any money at risk. Even if the tenants are significantly more wealthy than the LL. How is this "fair"?

Fairness should be determined by the market. Not by tenant advocates...

Are the tenant advocates the ones making the court orders now? And drafting the legislation?

I suppose Consumer Protection (and its equivalent in every state), the legislature, AND all the members of judiciary and law reform commissions have gotten it completely wrong. They must be all idiots and clearly don't know jack about what the law should be.

Either that or its a some sort of big conspiracy against landlords around the country.

Those two things are clearly much more likely than the fact that their learned opinions on what's fair might be different from yours.