Tenant demands reasonable ?

[NotAllPMsRBAD!]

You can give them appropriate notice 'For No Particular Reason'. It's your property, after all.

I wouldnt be using the 120 NTV... VCAT is cracking down on them and if the tenants take you there to dispute it then most times they are now being knocked back... especially if the tenants bring this issue up and saying that you are giving them notice as retaliation!

use the end of fixed term tenancy notice.

Furthermore dont use a notice if it isnt true... ie that you are moving in.... you cant release the property for 6 months after the notice has been served.. again if the tenants want to be ********s and they see it listed for rentafter they move out they can take you to the tribunal and seek compensation for moving costs

 

[bennido]

Guess what ? ... the tenants just asked to terminate their lease early ! Woot !

They are obviously unhappy they didn't get everything they wanted and want to leave. Fine by me I say !

Anyway, they have to cover the rent until a new tenant is found. They also have to cover a pro-rated part of the agent commission for finding a new tenant (based on the number of weeks left in the existing tenancy agreement).

On another note, the rental in the area has gone up a bit since they moved in. Can I ask for a small increase in the asking rental ? My PM says if I do so the tenant will no longer be required to cover the interim rent.

Is she correct ? It'll mean that I am locked into another year at the same rental rate.

 

[rugrat]

Not up to date with VIC regulation - But I don't see any reason why you couldn't increase the rent for a new tenant, you wouldn't be increasing it on the old tenants.

 

[bennido]

Not up to date with VIC regulation - But I don't see any reason why you couldn't increase the rent for a new tenant, you wouldn't be increasing it on the old tenants.

Yes, but I can see the logic behind the counter argument as well.

Which is, if I ask for an increased rental it will make it harder to find a new tenant. Hence, the existing tenants obligations are waived. Just not sure legally is that a valid argument or not.

Of course, my preference is to try to get a better rental with the next lease but at the same time, I would like the existing tenant to cover the lost rent in the meantime.

 

[rugrat]

Yes, but I can see the logic behind the counter argument as well.

Which is, if I ask for an increased rental it will make it harder to find a new tenant. Hence, the existing tenants obligations are waived. Just not sure legally is that a valid argument or not.

Of course, my preference is to try to get a better rental with the next lease but at the same time, I would like the existing tenant to cover the lost rent in the meantime.

That arguement would only hold up if it took a longer then reasonable time in finding new tenants.

 

[NotAllPMsRBAD!]

I am not sure what your property is leased for at the moment or what area it is in... You should know that vacancy rates for properties less than $450 pw are around 1.6-1.8% while those above are hovering around 4%.

Legally there is nothing in the ACT that stipulates that you cannot increase your rent, however by the same token if you increase it and cannot release it within a reasonable amount of time then the tenants can take you to VCAT and say that you are trying to profit from them breaking the lease and you are not doing everything in your power to release the property and lesson their financial burden.

Your options:

1. Dependant on the notice period they have given you, you may be able to try for a week at a slightly higher rental and if you dont get anything then drop it back to the current rate.

2. Advertise the property at the current rate and state that you intend to increase the rental from 'x' date being the date in which the current lease term expires

3. Release the tenants from their lease and you can increase it to whatever you like, but you do miss out on them paying for a portion of the LF (if there is not much longer left on the lease their portion of the fee you have to pay may be neglible anyway so this option may be worth it in the long term) So if for example the property is currently leased at $400pw, and there is 2 months remaining on the lease and the normal fee is 3% @ $1651 x 2 x 3% then their portion is only $104.00 (plus gst) If you increase the rent by $15pw you are still up by over $600pa. In this instance you would agree to the terms with the tenants for example: they still need to give 28 days notice but do not have to pay the LF & Advertising, and you should be able to release the property during this (make sure you also include that the tenants have to provide reasonable access to be able to release the property)

Shoot me a PM if any of this isnt clear

 

[Leikela]

I agree with point 2 of NotAllPMsRBAD!

I think this is the fairest way to go, it's a win-win for everyone. By charging the new tenants the same rate as the old ones then you aren't out of pocket and at the same time aren't seen to be profiting from them ending their lease. However, you still get your rent increase which you would have got when this lease was up and the new tenants get a discount if rents really have increased in the area. Say there's 6 months to go on the lease, then they're getting 6 months discounted really, so it shouldn't be too difficult to find a tenant.

Is there a black and white rule on this, or is it just "reasonable time" to find a new tenant... I think if you did the above you'd be seen to be trying to get a tenant in a reasonable amount of time, and it shouldn't take too long anyhow if a tenant sees they are really getting the first few months discounted (assuming rentals really have gone up like you say).

 

[Croc Dundee]

I would kick them out now - these people are just going to be trouble on an ongoing basis.

The first problem is very rarely the last

stuff 'em

Next....

 

[NotAllPMsRBAD!]

Is there a black and white rule on this, or is it just "reasonable time" to find a new tenant... I think if you did the above you'd be seen to be trying to get a tenant in a reasonable amount of time, and it shouldn't take too long anyhow if a tenant sees they are really getting the first few months discounted (assuming rentals really have gone up like you say).

Reasonable amount of time is a grey area and really depends on the market and what the agent/landlord has been doing to try and release the property.

if worst case scenario the tenants took the matter to VCAT the the agent/landlord would need to provide evidence of what they had done for example copies of all advertising, number of enquiries, number of inspections and if applicable number of applications and the reasons why the applications did not proceed. In broad terms a month would be deemed reasonable in a normal market providing the tenants had provide adequate access and presented the property in a good manner, anything above a month and you are going to start to run into some problems with VCAT

 

[Leikela]

What if it happened in reverse and for whatever reason rents had decreased in the area. Say someone is 4 months into a 12 month lease then decides to break lease... if you advertise at the rate that tenant is paying and it's taking ages to find someone because rents had reduced, are you required to drop the price to find someone in a reasonable amount of time and then be out of pocket?? Or can you advertise forever at the same rate, and if you can't get a tenant then tough luck for the current tenant breaking the lease?

 

[NotAllPMsRBAD!]

What if it happened in reverse and for whatever reason rents had decreased in the area. Say someone is 4 months into a 12 month lease then decides to break lease... if you advertise at the rate that tenant is paying and it's taking ages to find someone because rents had reduced, are you required to drop the price to find someone in a reasonable amount of time and then be out of pocket?? Or can you advertise forever at the same rate, and if you can't get a tenant then tough luck for the current tenant breaking the lease?

nope unfortuantely you would need to drop the rent and it would be tough luck for the landlord! (sorry but we all know VCAT sides with the tenant before the landlord) You may be able to get the tenat to pay the shortfall of the new lease until the expiry of the current lease tho