Tenant's Question: PM increasing bond before my lease starts, fair?

[purplemonkey]

Hi all,

I couldn't recover my old username but I used to post heavily on here eons ago (3 years ago now).

Anywho here's the quick outline of the situation to save you time. BTW, I know this is a forum skewed towards owners and PMs and I like that as I want to be in the owner camp myself:

• I was subletting from my flatmate and then he got a job offer in Burma and moved at short notice. I haven't been on the lease. The lease had been for 6 months but became month-month. This happened around 16-20 Dec sometime (can't remember exact date).
• Have found two consecutive tenants. First was for two weeks. Second just moved in right after the first.
• I decided to take over the lease, hoping it would stay month-to-month. Landlord said it had to be a new lease with a six month period (I now realise I could have gone on as another person on the lease and then removed my old flatmate and potentially avoiding the six month period. I can see why the PM didn't want that and I only figured out this option afterwards. Fair enough, I don't like it but she's doing her job and representing her landlord. I'll be wiser next time.
• We agreed to do a bond transfer and then I would sort out the money with my old flatmate. The bond would be $1560 (approx) as that was 4 weeks rent when it was signed originally (a while ago I'm guessing).
• I managed to get the bond transfer paperwork signed by my old flatmate just before he left. Everything was pretty tight time-wise.
• Today I get an email from the landlord that the bond transfer was disapproved because I wasn't on previous lease. She said we need to do a new bond and now it's $1800. The email basically said 'Here's the new amount, pay it ASAP'.
• The tenancy agreement I signed begins on the 17th of January.

OK, so here's the issue. First off, she should have known that the transfer wouldn't work. I trusted her experience as a PM when she recommended this course of action. So she's either doing something malicious or she's incompetent. Whenever I have those options I assume incompetence.

Secondly, she wants to summarily increase the bond amount right off the bat. No conversation, no consultation.

Then it's straight to 'we need to hurry' and 'do it ASAP'.

My perspective is this: if she had got the paperwork right the first time we wouldn't be in this mess so don't put the pressure on me to hurry. Secondly, not only is she unapologetic about creating this situation but to crank up the bond without conversation or discussion is, at the least, just plain rude.

So, a room has opened up close to where I live and I wouldn't need to sign a lease.

Question: Does the tenancy agreement only take affect once I move in or am I bound to it now? (deep down I think I know the answer, just want confirmation).

More interesting question (and try, I mean really try, to put yourself in the tenant's shoes for just a moment here): How would you deal with a PM that starts trying be a dictator about things instead of showing some empathy and being reasonable with their tenants?

Thanks in advance for the feedback.

 

[geoffw]

Reading between the lines, it looks as if the rent has increased. A maximum of four weeks rent can be charged as bond. If you've agreed to the rent, you won't be able to object to bond which is four weeks rent or less.

That can hurt cashflow- but at least it's money you will get back. Assuming it's in good nick when you finish.

Make sure you document the condition exactly with photographs. If you get a condition report from the PM, check it very carefully. Any objections, email back with pictures to ensure you have documentation. You can lose a lot more from an agent who screws you on the condition of a property than one who charges a higher bond.

Be very careful with that that any problems which now exist are taken out of the previous tenants' bond.

 

[thatbum]

I don't actually understand what the issue is. You're not happy with how it played out?

 

[DaveM]

I dont believe that NSW allows for bond top-ups on bond transfer.

 

[wylie]

Hi all,

I couldn't recover my old username but I used to post heavily on here eons ago (3 years ago now).

Anywho here's the quick outline of the situation to save you time. BTW, I know this is a forum skewed towards owners and PMs and I like that as I want to be in the owner camp myself:

• I was subletting from my flatmate and then he got a job offer in Burma and moved at short notice. I haven't been on the lease. The lease had been for 6 months but became month-month. This happened around 16-20 Dec sometime (can't remember exact date).
• Have found two consecutive tenants. First was for two weeks. Second just moved in right after the first.
• I decided to take over the lease, hoping it would stay month-to-month. Landlord said it had to be a new lease with a six month period (I now realise I could have gone on as another person on the lease and then removed my old flatmate and potentially avoiding the six month period. I can see why the PM didn't want that and I only figured out this option afterwards. Fair enough, I don't like it but she's doing her job and representing her landlord. I'll be wiser next time.
  
  You really have little control over this. Had you requested to be put onto the lease, it probably would have occurred to the PM or the owner that the lease is now month to month, and likely you would have been asked to sign a new lease. If not, then they are holding a lease in the name of someone no longer living in the country, and three others living there who have no skin in the game, ie. not on the lease, therefore not ideal at all. So either way, you would probably always have been asked to sign a new lease.
  
• We agreed to do a bond transfer and then I would sort out the money with my old flatmate. The bond would be $1560 (approx) as that was 4 weeks rent when it was signed originally (a while ago I'm guessing).
• I managed to get the bond transfer paperwork signed by my old flatmate just before he left. Everything was pretty tight time-wise.
• Today I get an email from the landlord that the bond transfer was disapproved because I wasn't on previous lease. She said we need to do a new bond and now it's $1800. The email basically said 'Here's the new amount, pay it ASAP'.
• The tenancy agreement I signed begins on the 17th of January.

Is it possible the PM didn't realise you were not on the lease? If not, then possibly she has overlooked this.

OK, so here's the issue. First off, she should have known that the transfer wouldn't work. I trusted her experience as a PM when she recommended this course of action. So she's either doing something malicious or she's incompetent. Whenever I have those options I assume incompetence.

You are happy that she is incompetent enough not to allow three people to live in the house, none of whom is on the lease, and think she is incompetent to be asking for a new lease signed by those now living there (because that suits you) but not happy that she has made an error (incompetent?) that inconveniences you?

Secondly, she wants to summarily increase the bond amount right off the bat. No conversation, no consultation.

If the rent has gone up, and there is a new lease in place, and the old bond will be refunded to your mate, then it is fair enough that she is asking for a full bond at the new rental rate.

Then it's straight to 'we need to hurry' and 'do it ASAP'.

My perspective is this: if she had got the paperwork right the first time we wouldn't be in this mess so don't put the pressure on me to hurry. Secondly, not only is she unapologetic about creating this situation but to crank up the bond without conversation or discussion is, at the least, just plain rude.

It is business as usual. The old lease was in the name of someone who no longer resides in the country. She has three people living in the house that have no lease. I would not be happy as an owner with that situation.

So, a room has opened up close to where I live and I wouldn't need to sign a lease.

Question: Does the tenancy agreement only take affect once I move in or am I bound to it now? (deep down I think I know the answer, just want confirmation).

More interesting question (and try, I mean really try, to put yourself in the tenant's shoes for just a moment here): How would you deal with a PM that starts trying be a dictator about things instead of showing some empathy and being reasonable with their tenants?

Thanks in advance for the feedback.

I think she may have made a mistake in advising you of your ability to transfer the bond from your mate's name to yours. But in every other respect, I believe she is doing her job.

Right now, you are in a house with no lease, three people with nothing legal to say you have a right to live there. I'd be wanting a lease signed immediately if I owned the house. I've been in this position and it was not a nice feeling, knowing they could damage our house and I had nothing to protect myself.

Did you pay your mate the bond that you thought would go into your name? If so, then you need to sort that out between yourselves. When we had a tenant go overseas, her bond went via cheque to the house she no longer lived in as that was her last known address. The other housemates would have sent the cheque to her overseas but that was up to them.

I really also think from reading this that you've signed a new lease. If so, then yes, you are bound by it, and if you can find a replacement for yourself, you could move into the other place, but you'd need to see if you can remove yourself from the lease and replace yourself with another name. We've done that with a house where one young chap leaves, another moves in and we add names. Unless these young men needed a lease with their name for parking permits, I reckon they'd never even let us know one was leaving to be replaced by another.

 

[chilliblue]

I dont believe that NSW allows for bond top-ups on bond transfer.

That's my understanding

 

[geoffw]

I dont believe that NSW allows for bond top-ups on bond transfer.

He mentioned in the original post that the bond transfer wasn't approved because his name wasn't on the lease.

This might actually be a good thing because now the previous tenant will be liable to fix any problems which may have been caused by them.

 

[wylie]

I dont believe that NSW allows for bond top-ups on bond transfer.

There is no option to transfer, because it sounds like there is a new lease signed, with fresh parties on that lease so a brand new bond will be taken and lodged in the names of the new lessees.

Apart from the PM either not knowing, or not realising the bond cannot be transferred, this by all accounts is a new lease. It would be different if the poster was even on the original lease.

Edit - Just wanted to add that I do understand your frustration and you are looking at it from your viewpoint, which is just a follow on of already living there, and this is a hassle you don't need.

I understand how you feel as a tenant but I believe if you were the landlord, you would want the people living in your house to be bound by a lease, and to be holding the appropriate bond. And that is where I have issues. You are not on the lease and neither are the two people you've effectively sublet to. So, you are asked to sign (or already have signed) a brand new lease, sounds like at a higher rent, or at least higher than the original bond covers, and what the PM has done is what I would expect her to do if it was my house.

I don't want to sound harsh or offend you, but I believe the PM is doing the right thing (apart from messing up the advice regarding the bond transfer).

 

[purplemonkey]

Thanks for all the replies, much appreciated. I am on mobile so excuse any typos or if this is brief. Can post more later.

A fair clarifications:

- the old lease ends in the 17th of January. That's when my lease will begin. Technically my former flat mate is subletting to me and the others. We've kept the pm informed the whole time.

- There seems to be some misunderstanding in other replies. There have never been more than two people here at any one time. It's a two bedroom place. The pm has been aware of all of this ahead of time.

- The rent has increased and will increase again in Feb as per schedule, no objections from me.

- I understand why 4 weeks bond 4 years ago is a different amount from today.

My chief objection is that, legal niceties aside, apparently $1560 was an acceptable amount for bond before but suddenly isn't because of the paperwork snafu. Legally 4 weeks is the maximum. I don't feel it's fair to change te arrangement without consultation and then put he rush on me because she dropped the ball.

She knows I was not on the old lease and if she doesn't then I have to wonder how she organised her professional affairs. She's also asked for my old flatmate's bank details which she should have on file. My flat mate also told me he once tried updating the people on the lease in the past and they didn't do it. They then asked months later for him to advise on who the other flat mate was and he reminded them about updating the lease. They said thy lost the paperwork and asked if he had a copy.

Anyway, my other cause for concern is that they haven't done a condition. Report since 2009 and when I asked if we could do one she was very reluctant and declined. I think if he wants to go by the letter I the agreement when it suits her then I should make sure I get that report and protect myself.

 

[wylie]

Because you are not on the current lease, definitely get a condition report done now and take lots and lots of photos so that you cover your backside if they try to pin you for any damage already there before you are on the lease.

She does sound very slack about her paperwork. Have you signed the new lease yet?

If not, then you could move out and rent the room you talked about in an earlier post.

 

[Scott No Mates]

A fair clarifications:

- the old lease ends in the 17th of January. That's when my lease will begin. Technically my former flat mate is subletting to me and the others. We've kept the pm informed the whole time.- There seems to be some misunderstanding in other replies. There have never been more than two people here at any one time. It's a two bedroom place. The pm has been aware of all of this ahead of time.

- The rent has increased and will increase again in Feb as per schedule, no objections from me.

Has the managing agent given you 60 days written notice of the rent review? (I don't know how they could have if the lease starts in Jan and the rent increases in Feb

- I understand why 4 weeks bond 4 years ago is a different amount from today.

My chief objection is that, legal niceties aside, apparently $1560 was an acceptable amount for bond before but suddenly isn't because of the paperwork snafu. Legally 4 weeks is the maximum. I don't feel it's fair to change te arrangement without consultation and then put he rush on me because she dropped the ball.

This is a new lease with new tenants listed, not a continuation of the previous lease. Bond should align with the lease (or can be less if negotiated) - you COULD build a case that as a previous sub-tenant (if you have a copy of the notification to the agent) that you cannot have your bond increased.

She knows I was not on the old lease and if she doesn't then I have to wonder how she organised her professional affairs. She's also asked for my old flatmate's bank details which she should have on file. My flat mate also told me he once tried updating the people on the lease in the past and they didn't do it. They then asked months later for him to advise on who the other flat mate was and he reminded them about updating the lease. They said thy lost the paperwork and asked if he had a copy.

Anyway, my other cause for concern is that they haven't done a condition. Report since 2009 and when I asked if we could do one she was very reluctant and declined. I think if he wants to go by the letter I the agreement when it suits her then I should make sure I get that report and protect myself.

If the agent doesn't do an entry report, you should submit yours to the agent regardless.

 

[wylie]

I was thinking this through whilst showering...

If you haven't signed the new lease I'd be thinking seriously about moving into that other room you mentioned.

This agent does sound incompetent (asking YOU for any paperwork you have is just bewildering... ).

I'm guessing if she doesn't have the paperwork she should, she may also not have the entry condition report. I'd also guess she may try to pin any wear and tear (which should not be an issue) or other damage on you when you leave.

Really, she shouldn't be doing an entry condition report whilst you are there, because she cannot see behind furniture etc. I know a case where someone we know wanted to leave and the flatmate wanted to stay on a new lease. The agent refused to do a new entry condition report unless his flatmate cleared the place so it could be done with the place empty.

I'd be very careful with this. Of course, I'm assuming you have not done any damage to the place and can leave (if you haven't signed the new lease) with a clear conscience.

 

[purplemonkey]

Because you are not on the current lease, definitely get a condition report done now and take lots and lots of photos so that you cover your backside if they try to pin you for any damage already there before you are on the lease.

I'll definitely take heaps of photos, maybe do a video (where I start by showing the smh.com.au homepage so you know it's from that date) and document everything.

She does sound very slack about her paperwork. Have you signed the new lease yet?

I have signed the lease. So my question is: does the lease take effect as soon as it is signed or from the commencement date. Technically I am still currently subletting from my old flatmate.

Has the managing agent given you 60 days written notice of the rent review? (I don't know how they could have if the lease starts in Jan and the rent increases in Feb

They did to my previous flatmate and they told me as soon as we started transferring leases, etc but technically I guess I didn't get the 60 days notice. I know it's a breach but I was aware of the increase and I personally don't think it's unfair. The property is a great rate for the area and what I'm getting so I'm OK with it (not all us tenants are out to screw the landlord).

This is a new lease with new tenants listed, not a continuation of the previous lease. Bond should align with the lease

Right, that by itself is reasonable IF that was the original agreement - but it wasn't. The way I see it is that once we sat down and did the paperwork that's when we made the agreement. At that time $1560 was effectively going to be the bond. If they wanted more for bond (ie. a top up) then that would have been the time to discuss it (even though you can't top up bond transfers I would have been OK if they had asked for it).

So I feel we've made our agreement and this issue was settled. To come back afterwards and to opportunistically use this issue (that's their fault) to now try and get another bite at the apple isn't the way to do business. Then to be not acknowledge the error and the extra work it creates for me (running around, etc) isn't very nice. And then to behave as though the onus is on me to hurry things along shows a lot of hide. And to summarily decide to alter the agreement without consultation and expect me to be OK with that isn't right.

On top of all that, we both knew that it's going to be harder to get in touch with the former leasee now that he's in Burma. Which makes it doubly frustrating that she didn't get that end of the paperwork squared away when we had that opportunity.

New Info

So I checked me actually agreement and the bond requested is written as "AMOUNT HELD". Seems as though the lease I have is written as a lease transfer. So we have a legal contract that can be looked at one of two ways:

1) It's a lease transfer (which evidence suggests the property board would reject) and therefore "AMOUNT HELD" is the $1560 they already have as bond.

2) It's a new lease in which case "AMOUNT HELD" would be $0 and that's OK. Remember you can charge up to four weeks rent (maximum) but there's no minimum.

Fresh questions

As most of you are landlords here:

1) Would you be happy with having this PM?

2) The place is in Bondi, not too far from the beach. Very easy to rent out. If I can find new tenants would you object to someone transferring the lease so early on in an agreement? Or would you just shrug and say "it's all the same to me, tenants come and go, as long as they can pay the rent and don't damage things and I'm not out of pocket I don't much care either way".

The reason I'm looking to move close to the city BTW is because I work full
time in the city, I work on startups in my spare time and getting home at 11:30 every night is no longer outweighed by the benefits of living near the ocean, much as I love it. I'm a hardworker looking to improve my life, not get dicked around by PMs who think it's my responsibility to put in extra effort to sort out their ***** ups. Especially when they're bossy and unapologetic about it.

FWIW, my last PM told me I was the best tenant he's ever had and gave me a glowing recommendation for this lease application. I didn't care what he wanted to do so long as it didn't effect me in a practical way and he always called, consulted me and all was well. I guess the lesson is a bit of courtesy and human touch prevents a lot of problems and it's not a bad thing for landlords and PMs to be reminded of.