Renewing Residential Tenancy Agreements

[OmegaMan]

Rental property in Blacktown, NSW.
We've already given the tenant due notice of the rent going up on the 1 year anniversary of the lease. The rent was to go up on 3 January 2014 from $325 to $345.

If the jump seems pretty large please take into account that the rent was discounted when the tenant signed up a year ago due to my PM getting panicky about the difficulty of finding new tenants in December, and convincing me to knock it down $15pw under market value at the time. (Regret that now, but that's another story.)

Anyway the tenant has now phoned the PM to say he can only afford $335 per week, and followed that up with an email which she forwarded me.

So I'm going to allow him pay just $340 pw on the proviso that he signs a new Tenancy Agreement thus specifically agreeing to that amount.
Because if he doesn't agree to $340 pw we've still got enough time to give him 30 days Notice of Termination of the initial lease (ie in time to have him leave at the end of that lease) provided we serve the Notice by the end of this month.

Am I allowed to ask a tenant to sign a new lease one month before the old one ends? Can it be forward-dated to commence from the anniversary / expiration of the previous RTA?

 

[Scott No Mates]

Nothing stopping you from having a new lease in place with the current tenant. The only things that you cannot do is increase the rent without having 60 days prior notice (so your rent will increase after the lease commences) and you cannot top up the bond.

 

[jenni_nextplace]

Yeah absolutely. When I was a PM we used to as standard give our tenants 2 months notice to vacate with every lease renewal which and also included the rent increase. This tells them that even if they don't sign a new tenancy agreement that their rent will increase anyhow. (and that if they don't sign they will be required to vacate)

This stops tenants from dragging it out as long as they can the rent increase date.

So main point is, they don't need to sign a new lease for you to notify them that the rent will be increased at the end of their lease. It just goes onto a periodic lease but at the new rent. If that makes sense.

 

[OmegaMan]

The PM horror story just gets worse,,

I'm in the crazy situation where I can't trust the PM not to try to "pull one" (another stunt, that is) over me on behalf of the tenant.

It is now 2 days before the deadline that I gave the tenant 2 weeks ago to sign a new lease, and so far I have:
a) a promise over a week ago from the PM that the tenant was happy to re-sign, and would do so next day, and
b) still NO new lease!

The PM did email me today to say she had been trying to email me a copy of the new lease, but it kept "bouncing back" because the attachment was too large and so she has put it "in the mail". I instantly replied with a fax number she could send it to me on and, as strange as this sounds, I am NOT surprised that no fax arrived.

Call me paranoid, but:
1) I have never seen (much less been asked to sign) ANY lease for the current tenant.
2) When I spoke to her in person last December I said that the guy sounded like a bit of a smart-**** for asking for 4 weeks rent-free until he was ready to move in.
3) I was given no role in choosing a tenant despite her promises that I would.
4) The first I knew about even "having a new tenant" was late December when I emailed to ask why the rental advert had been pulled. She informed me she had signed up the "tenant that we spoke about".

It's now starting to make sense that the rental advert:
1) failed to mention gas cooking
2) failed to mention secure undercover parking
3) failed to mention that it was a modern block (built in 2003, not the 1980's)
4) failed to mention that it has an ensuite (as well as a bathroom).
Maybe she was trying to scare off prospective tenants!

When I met her in early December 2012 and she told me she only has "one person" interested, but that he couldn't move in until the start of January (only to avoid himself paying double rent, I dare say). I now believe that she had might have already signed him up on those terms without my consent (in fact against my wishes) as it ended up being ME who missed out on one month's (December) rent. The guy was quietly installed without my knowledge.

Just by way of background, may I "throw in" that the tenant paid absolutely no rent March 2013 at all. But rather than chase it up as they promised, the PM instead creditted the tenant with 9 weeks rent for paying only 5 weeks rent on the April 2013 statement - then blamed that on a clerical error! But they never fixed that "error", and never chased up the missing 4 weeks rent.

So, now that I am getting nothing but excuses and stalling tactics when asking for a "new" lease, can you blame me for thinking that this is just another stunt that the PM seems to be colluding in? If the tenant was actually keen to stay on as the PM stated why would've he left things so late?

My legal concerns are:
1) If I issue a Notice to Terminate Tenancy Agreement with 30 days notice for reason of "End of Fixed Term Tenancy" will that fall over if I can't prove the tenant had a lease in the first place?
2) Since I did not start receiving rent until starting from 8 January 2013, can that serve as a notional commencement should the tenant present a lease that says that he started in December 2012, thus making it too late for me to serve an "End of Fixed Term Tenancy", therefore requiring me to then go to a 90 day "Termination without a reason" instead? After all, the law says that if a landlord did not sign a lease the lease still comes into effect as soon as rent money is received.

What would you guys do in this situation?

 

[Sez]

Change PM's and report them and get someone checking their books !!!

 

[Bats]

Beyond belief

I just don't understand how owners can let these things to go on for so long.

Property Investment should be treated as a business, not something that is done on a Tuesday night for 15 minutes. This is your money and future that the PM's are playing with and let you let them walk all over you.

I don't know what the answer to your query is and honestly it doesn't really matter.

You need to get rid of this PM and get another one who will work for you at all times - you pay them, not the tenant and start managing the PM. They are not permitted to go outside the Managing Agreement that is signed by both parties - it is an agreement that you both agree to work within its authority. If the PM steps outside the authority, come down on them like a ton of bricks.

PS We have in excess of a dozen properties and are on top of all of them, if the PM knows your attitude and you are following up with them, as a rule they will do the right thing.

Sorry for the length of this - think I am starting to ramble.

Bats

 

[Lil Skater]

Change PM's and report them and get someone checking their books !!!

I agree!!

That is shocking, no wonder PM's get a bad name!

Pull the management immediately, find a new PM and chase the old one for not managing the property.

Are you sure the tenant isn't a friend of the PM?

 

[kathryn d]

I'd be insisting on a copy of the lease, and rental payments.
Then you know when the lease started.

Any arrears to be taken from the bond, when they vacate.

As others have said, get another PM...or maybe do it yourself.

 

[The Fence]

I agree!!

That is shocking, no wonder PM's get a bad name!

Pull the management immediately, find a new PM and chase the old one for not managing the property.

Are you sure the tenant isn't a friend of the PM?

Right on the money with all the above Lil.

No offence intended but that is why we decided to go it alone many years ago now.

All we could seem to think, with every action our PM made, was they are touching us up. It all ended badly with the tenant from hell that they found and some rather bad smelly damage, let alone $1800 in lost rent when the tenant did a runner. PM said nothing they could do about it. Go figure???

AND, we managed the PM with respect all the way, but probably asked too many questions. But hey, what on earth is wrong with that?

Do it yourself, it's a cinch when you have educated yourself in the legislation and take a non emotional approach.

 

[dreamgirl]

+1 for self-managing.

I find I'm a lot more in touch with what's happening with my properties since I ditched the PMs.

Now I'm managing the tenants directly, rather than managing the PMs who were supposed to be managing the tenants.

 

[wylie]

And another vote for self managing. One of the big differences I've noticed since we started having a PM advertise and find us a tenant is that they think it is OK to wait a week after a tenant leaves to give them time to come back to clean. I'd rather spend half a day getting the house ready for the next tenant than wait about like a stale bottle of beer for three days, at a cost to me of (say) $70 a day. That means also another wait until the next Saturday for a 10 minute open house and they will likely allow a promising tenant another two weeks to move in.

When I do it myself, I often have tenant out one day, next one goes in a day or two later and if they want two weeks to give notice and move in and start the lease I have often met them half way and we allow one week and they pay one week overlap.

I know it is easier for me to manage one empty house and a PM is juggling several at once, but I move much quicker and keep on top of things at all times.