Tenant demands

[july]

Hi
We have advertised our ip for rent.
Several people have expressed interest and we have received one application (it has only been recently advertised).
The applicant is asking for air conditioning, a linen press, additional bathroom storage (there is already a cupboard & three drawers under the handbasin), bedroom storage including wardrobe and cupboards (at present there is no storage in the bedroom) and alarm system (including external security monitoring at the owners expense!!).
We did not advertise the property with any of these features and are concerned at the seemingly high demands of the applicant. Fortunately we can afford to hold the ip indefinately without tenants and are therefore not under any pressure to rent immediately. I think it is reasonable to put storage into the bedroom but believe the other requests are extrodinary given that the applicant does not want to pay any extra rent.
I am also disappointed that the property manager is passing on these sorts of demands to us, I am getting the impression that she just wants to rent the appartment and is perhaps telling the applicants that we will consider doing these things despite having told her that they may happen, but not in the next twelve months.
I just wondered if other investors were having similiar experiences and how you handle these sort of requests from tenants and any thoughts on the property manager.
Thanks
Oh, and the applicant wants to bring a pet as well!!

 

[michaelg]

Hi,

It maybe that the tenants have been given the impression that vacancies are high and that landlords may be pressured to satisfy tenants whims.

Wonder who is giving the tenants this impression?

I had a new IP and the 1st tenants planted all these plants in the gardens, they then sent the receipts to my property manager requesting a rebate.

I polietly informed the PM to inform the tenants, that I cannot be held responsible for expenses incurred without my prior approval.

It comes down to what is reasonable, and what affect it has on your overall financial picture. Do you need the tenants, can you find others?

Michael G

 

[Kristine..]

July

As you are renting an apartment, what competition are you up against? How many vacancies are there in your apartment block / immediate area?

Do other apartments have these amenities? Apartments are notoriously short on storage space, so this may be something to consider as an improvement in your best interests regardless of this particular tenant.

As for the air conditioner, would the apartment be unbearably hot without it, ie does it face west? In which case, ditto, the market will ask for it.

Regarding the alarm: unless 'everybody else' is alarmed (! no pun intended) then ignore it, but make sure you have a modern standard of locks on doors and windows.

If you think that the property manager is taking a somewhat cavalier attitude to your best interests, then now might be the time to consider another manager. Otherwise, you may find yourself battling with him/her over an extended period of time. No joy there.

Feedback from the market is important. Tenants and buyers are mobile and will often have a very good idea of what is available and at what price.

However, if these particular prospective tenants are giving you an uneasy feeling, then maybe do the improvements, but don't accept their application.

Cheers

Kristine

 

[july]

Mistake

Hi Kristine
I made a mistake in my first posting - the ip is a small freestanding house, not an apartment as mentioned in the first post. It has been a really loooooong day.
Sorry!

 

[Kristine..]

Hi July

Apartment, Unit or House, doesn't matter, same principles apply:

(i) How does what you're offering compare with the immediate market, geographic or economic, and

(ii) If you think the tenant has an attitude problem, you're right! There's plenty more who will be less autocratic in their approach, and

(iii) Investing should be fun!

Cheers

Kristine

 

[handyandy]

My attitude tends to be if you didn't see it its not included.

To qualify this we prepare all our properties to a set standard (which as mentioned takes into account other properites available). If I include any specials then I will be aiming for a 25-30% pa payback on those improvements, otherwise they are not worth doing.

Look at the positive side its better that they make their demands now and you can simply say goodbye then to have them move into the property and be asking for different things every week. When you have the latter you just look forward to the expiration of the lease.

Cheers

 

[geoffw]

I'd also really be looking at the competition.

For a start, you don't mention which city. That's not important- but just a pointer to say that if you're trying to rent an apartment, for instance, in inner Sydney, you may be in for a lot of competition, and may well have to agree to a tenant's demands. But if your house is in an area with low rental vacanies and not too bad rental yield, then no deal.

Another approach may be to accept demands, buit at a higher rent (or other conditions). You may be able to charge more for having a pet- but if you can't. include a very good cleaning clause in the lease.

 

[natmarie73]

If you give in to the tenants demands, will they not keep coming up with more and more expensive demands down the track? I personally would tell them to P.O.Q. especially if you don't need the rental income in a hurry.

 

[Jas]

From the tenants POV - if you don't ask, you won't get.

Sounds like you got a negioator on your hands. Figure out what's reasonable for you, and go back. If they insist on going past your limits, you are in the great postition of not needing them.

If its only been on the market for a while, you'll find another if this one falls through.

Jas

 

[GoAnna!]

Hi July

It is not unusual to have such requests at either the beginning of the lease or at lease renewal time.

For me it just comes down to the numbers. We recently relet a house at around 28% more rent (higher than we expected). The new tenants wanted a fence to keep their children safe and they also wanted a two year lease. In this case the numbers added up in my favour so I gave them the nod.

Other tenants have wanted a lot without paying any extra. One was upset that the house had only 4 TV points and wanted an extra room. I was happy to be unable to help them!

So as others are saying compare your place with others on the market and see if improevements are required to make it competitive at the current asking rent.

"I am also disappointed that the property manager is passing on these sorts of demands to us".

I am unclear as to why you are disappinted with PM. Is this because you think they are encouraging the tenants to have unrealistic expectations? Personally I would want my PM to pass on any information in regards to prospective tenants so that I have all the information to work with. I would be less impressed if after two months vacancy she mentioned that tenants had been asking for a linen closet !

You are in the happy position that you property has just come on the market and you are getting immediate feedback. I would also be asking why others have not been interested so far?

I would be interested to know final outcome.

Good luck!

 

[july]

We are unhappy with the property manager as she seems to be encouraging people to make further demands.
For example, the propety is brick and has ceiling fans installed, it tends not to get really hot due to these factors. There is a similiar property for rent in the same street with air conditioning which is renting for $30.00 more per week, I would expect the pm to be pointing this out to any potential tenants. I don't mind if she says that she will discuss any requests with us however it will probably increase the rent.
What she seems to be doing is telling the potential tenants that we will consider all these things for the same rent, which I believe is encouraging the unreasonable demands.

 

[Macca]

Hi July,

I believe it is important that you have a good relationship with your PM. You have to be able to rely on them to be fair to you and your tenant.
I think you now have a good opportunity to compare their activities to others, why not do an indepth survey of what is available for rent in your area and what rentals are being obtained.
You can then make an informed decision on the requests from the tenant and the suitability of your PM.
If you are competitive in $$$ for similar houses then your PM is NOT doing the right thing by you, simply looking for an easy rental at your expense.........gotta go......... bye bye PM.
If your IP is not as attractive as others for similar $$ then PM is ok and work is needed on IP

my 3c worth

Macca

 

[july]

Hi
Just an update.
We have received another application on the ip and the tenants have requested fly screens on two small windows!
It was worth holding on for a more reasonable tenant.
Thanks

 

[manny]

Hi July,

good to see u got another better application with less demands... u did the right thing not going for the first person & it shows that patience has paid off once again...

I once had a potential tenant walk through an IP while I was doing work in it & was asking me if we can put in X, Y & Z for them.... I said we will see... when their application came to me I told the PM to just throw it in the bin as I can imagine what demands they would have once they were in the IP...

In terms of tenants asking if they can plant new trees/plants, larger letter box (being a big Ebay purchaser wanted a larger letter box), etc... I normally say yes with them leaving it behind when going...

Good luck with it all...

MannyB.

 

[Jacque]

Hi July,

Glad to hear that your second tenants were more to your liking!

From the other side of the fence, however, I recall going to rent one house in the middle of Jan to find it west facing and unbearably hot. It was also unfenced around the sides. We negotiated with the landlord to have an a/c and side gates put in before we moved in at an extra cost of $30 a week. This made us all happy. When we moved in we found missing locks, leaking taps and broken venetians. Fast attention to these made for a better relationship, I can tell you! If they hadn't of been attended to, I would not have stayed as long. Sometimes, it's the little things that matter the most........

I guess what I'm trying to point out is that both parties need to be happy for a successful tenancy. Maintain your property, look after your tenants (especially the ones who keep the place nice and always pay their rent!) and remember that they're the ones forking out the most for your mortgage. However, there are always going to be those pains who want everything and more and then a reduced rent as well! Let your PM know the house comes as it is, however you would welcome feedback. If you're happy to meet the costs without raising the rent, then do so. If not, it's your call. In the end, it's the market that lets you know if your rent is too high for what you're advertising.
Off you go to BBC for those flyscreens!...........