Rewarding good tenants

Discussion in 'Innovative Techniques' started by jalen712, 2nd Jun, 2015.

  1. Mtmellum

    Mtmellum Member

    Joined:
    27th Apr, 2015
    Messages:
    7
    Location:
    Brisbane, Qld
    I'm a believer in it. However, I always make it a Bunnings gift card. They usually buy items for the house or garden!

    Works for me. No turnover on 2 propertys, one for 6 years and the other for 3.

    If I'm not wrong, I think it was Steve McKnight or Margaret Lomas who originally wrote it? And I do claim it as a tax deduction.
     
  2. willister

    willister Member

    Joined:
    11th Mar, 2011
    Messages:
    283
    Location:
    Sydney, NSW
    Many moons ago (parent's sold ip) we had a son who rented our place to look after his elderly father. Each Easter & Xmas we would provide a hamper from the big chains or we would do it ourselves of around ~$50 and two movie tickets.

    He kept the lawn nice and tidy contrary to the rest of the tenants we came across - we never had one we left on friendly terms, all were lukewarm experiences where we both had to compromise and overlook a few things to "move on".

    He also pitched in his own money and effort once and removed trees on the boundary so we could put in a new diving fence with our neighbour. We gave him a decent rate - was slightly below market rate but it was priceless, stayed 5 yrs, place looked better than when he entered it, no issues whatsoever.

    Good tenants need to be rewarded - something small as a token of appreciation.
     
  3. skater

    skater Capitalist

    Joined:
    8th Nov, 2003
    Messages:
    9,220
    Media:
    1
    Location:
    Sydney
    Clearly you don't have many properties.

    Exactly!

    Yes, there ARE good tenants. This tenant would have been a good tenant regardless!

    Sheesh, some of you think that the way they keep their home is a direct response to them getting a $50 gift card? Seriously!

    I've got more than a few properties. I have never once given a tenant a gift. It is business, pure & simple. Nothing else! Mind you, I have given the odd gift to a PM when they have had to go above & beyond due to a tardy tenant, but I don't make a habit of it.

    Tenants don't decide to trash a house, or clean a house dependant on gifts. They don't think "Oh, this landlord is lovely, he always gives us a present. Let's stay here another year because I just can't bear to get a different Landlord".

    A tenant will stay for as long as they want to stay. If you treat them poorly, then it might make them decide to move on, but if you fulfil your contractual obligations as far as a Landlord is concerned, if they like the place, they like the area, and their situation has not changed, they will stay there. It has nothing at all to do with giving them gifts.

    No they don't!

    I have a fantastic tenant in one of my properties. He's been renting the house for around 10 years now. He fixes stuff all the time, and he's painted it most years. I don't generally like tenants painting my properties, but he's a painter by trade, so it's always a first class job. We only ever find out when the agent goes for an inspection. He definitely treats the house as his own, and he is a great tenant. He doesn't get a gift! Why not, because he is just fulfilling his side of the contract. I never ASKED for the property to be painted. I never asked for him to fix stuff. He did it because he wanted to.

    I have other tenants that treat my IP's well, and stay long term. They don't get gifts either.
     
  4. Biz

    Biz $17 DOLLAS YO!

    Joined:
    14th Jul, 2014
    Messages:
    402
    Location:
    Sydney
    Ok, you guys have convinced me.

    I am going to gift my tenants a calender.

































    with highlighted dates of when the rent is due!
     
    skater likes this.
  5. Nick Valsamis

    Nick Valsamis Vantedge

    Joined:
    11th Apr, 2015
    Messages:
    131
    Location:
    Sydney
    I'm already planning what gifts to give for Christmas and new financial year celebrations.
     
  6. flygo

    flygo Member

    Joined:
    29th Apr, 2013
    Messages:
    12
    Location:
    Sydney

    No I don't have many, only 5 IPs at the moment. Less than most of the people on this forum. :)
     
  7. Choc

    Choc Member

    Joined:
    1st Feb, 2015
    Messages:
    14
    Location:
    Aus
    This thread has illustrated two distinct approaches to property investment. There are those who treat this strictly as a transactional model and do not see a need to reward their tenants because the perceived "good behaviour" is an expectation in the fulfilment of their contractual obligations.

    The second approach (which has seemingly attracted an unfair amount of ridicule) appears to favour an extension beyond contractual obligation and is also one that I personally favour.

    I think that some of you are confusing genuine appreciation as an attempt to motivate the tenants. These are very separate concepts. I don't think anyone here is naive enough to believe that a gift card or a hand written note is perpetuating those desirable behaviours. An average or terrible tenant will not become an excellent one simply because they received a gift card or a bouquet of flowers. A quality tenant is unlikely to regress and become terrible simply because they encounter a purely transactional landlord. Anecdotal evidence suggests that transactional landlords do have quality tenants on their books, in spite of the absence of "rewards".

    One thing is clear, no one has gone broke by rewarding their tenants and most of us who do are seemingly happy to persist with this "undesirable behaviour".

    I know of small business owners who cannot tell the difference between a bar of soap and the five to ten employees who work for them. I also know CEOs who take the time to walk the ground and make an effort to know the hundreds of employees who do not report directly to them.

    I also don't think there is a direct correlation between the number of properties you own and whether or not you extend beyond "contractual obligations". Someone who is more into relationship building and has a greater appreciation of a tenant's effort will likely persist with the "rewarding mentality"; regardless of the number of properties you own. Conversely, those who operate purely on a transactional model is unlikely to favour "rewarding" their tenant even if they only have the one investment property. Even if you own a hundred properties now, most people would have started with one.

    More often than not, it is your beliefs that determines your action; not the number of properties you own or how time/resource-poor you are. This extends beyond property investment.
     
    Nick Valsamis likes this.
  8. WattleIdo

    WattleIdo Member

    Joined:
    5th Mar, 2014
    Messages:
    1,536
    Media:
    2
    Location:
    country NSW
    Yeh, I'm seeing some of these as superiority complexes. But I guess if you inconvenience your tenants and live in the same building, you want to do as much as you can to remain on civil terms with them.

    To any landlords who've never rented, I can assure you that the tenants would prefer to be treated with fairness and respect rather than airs and graces. :rolleyes:
     
  9. Hulkster

    Hulkster Member

    Joined:
    3rd Mar, 2004
    Messages:
    206
    Location:
    Wrestlemania
    Who knew that so many somersoftians first IP was an ivory castle :rolleyes:
     
  10. DaveM

    DaveM KFC Buyers Agent

    Joined:
    19th Mar, 2011
    Messages:
    4,953
    Location:
    Sydney/Adelaide
    I buy tenants something nice if they help me out, like access for vals more often than they have to under tenancy law. Box of favourites or something, $10 and keep the relationship good
     
  11. inertia

    inertia Member

    Joined:
    4th May, 2015
    Messages:
    3
    Location:
    Newcastle, New South Wales
    Actually yes, they do. Long term customers, and sometimes just customers who are coming to the end of their contract are often offered significant discounts or incentives just to stay with them.

    Grant.
     
  12. deejay

    deejay Member

    Joined:
    1st Apr, 2009
    Messages:
    141
    Location:
    NSW
    I would be inclined to give a small gift to a tenant who was more cooperative than the law required them to be in a way that was helpful to me (for instance, flexibility and good grace while selling a house).

    We have "tenants" at the moment who have been very good with access and with cleaning up their part of a house in readiness for sale. Now, what they (and we) didn't know was they were subletting against the terms of the lease. (They're young and inexperienced, and thought whatever arrangement they'd entered into with the official tenant was legit). Meanwhile, the closed parts of the house they understood to belong to the "official" tenant are ghastly - soiled carpets to replace and abandoned goods. We've had to defer the sale to deal with it.

    Because they were so cooperative and conscientious with the part of the property they perceive as theirs, we've concluded that they don't realise their right to be there is questionable, and they also didn't realise that we could potentially go after them for any damage not covered by the "official" tenant's bond (official tenant is MIA). So we've rewarded them (though not phrased like that) by negotiating an exit the same way we would with legitimate tenants and treating the "official" tenant's actions as a separate matter. If they hadn't been so clearly responsible in their behaviour, we would probably have assumed they were mates of the "official" tenant, acting wilfully, and evicted and gone after the money. They've dodged a bullet, and probably barely realise just how big a bullet it was.
     
  13. redwing

    redwing Progress Not Perfection

    Joined:
    16th Mar, 2004
    Messages:
    8,533
    Media:
    69
    Location:
    WA
    Nah, at around $15 for a new toilet seat and $70 to get someone to fit it, it's cheaper to zip down and do the replacement yourself :D
     
  14. DEC

    DEC Member

    Joined:
    2nd Jul, 2010
    Messages:
    892
    Location:
    QLD
    They also charge late fees, I only wish LM's could do the same.
     
  15. Ausprop

    Ausprop Member

    Joined:
    20th Jun, 2004
    Messages:
    10,497
    Media:
    7
    Location:
    PERTH, WA
    as an idea and if I was determined to give money away, maybe it would be a better idea if once I knew a vacate was coming up I might send a flyer to the tenant, saying I conduct a rewards program whereby I score the cleanliness upon exit and there is the opportunity to earn up to $x00 in coles myer vouchers
     
  16. joeExpat

    joeExpat Member

    Joined:
    6th Jun, 2007
    Messages:
    626
    Location:
    Barcelona, Catalunya
    I used to reward them in Sydney by just never increasing the rent, only doing that between tenancies.

    As a renter (mostly overseas but Sydney and Brisbane also) I've never experienced inspections, the owners have never asked to see inside the property I live in unless there is some maintenance issue. I reckon they would be a bit invasive. Maybe a reward would be to lessen the frequency of inspections ?
     
    Last edited: 14th Jun, 2015
  17. S.T

    S.T Member

    Joined:
    27th Jun, 2011
    Messages:
    1,183
    Media:
    4
    Location:
    Melbourne
    Who celebrates a new financial year?!
     
  18. Nick Valsamis

    Nick Valsamis Vantedge

    Joined:
    11th Apr, 2015
    Messages:
    131
    Location:
    Sydney
    People that get tax back, that's who.
     
  19. hobo

    hobo Member

    Joined:
    10th Feb, 2013
    Messages:
    230
    Location:
    FNQ
    There are people who celebrate having given the ATO an interest-free loan??

    Strange people. :p
     
  20. Hulkster

    Hulkster Member

    Joined:
    3rd Mar, 2004
    Messages:
    206
    Location:
    Wrestlemania
    I've spent ten out of the last 15 years renting in Sydney and Melbourne and have decided that inspections during tenancy are a myth. I think LL's get lucky rather than have good PM's based on my experiences.