Common Questions We’re Asked By Gold Coast Property Owners
There are two ways property managers work:
One way is one property manager takes care of everything to do with one property. They communicate with the owner and tenants; they do the routine inspections; they make sure the rent is paid; they organise and make sure maintenance is complete; and they are 100% responsible for your property.
The other way is more common. This is where a property management team manages your property. Some people will be responsible for open homes and looking for tenants; some people will talk with the maintenance workers; some people will manage the rent and payment of funds into your account; some people will answer the phone; some people will manage complaints. This is great for a property management business as it makes things less costly (supposedly). Unfortunately, sometimes it is like musical chairs and you may call up and not have a clue who is doing what. Best case scenario the agency does know who is doing what. In this case, a senior property manager can have up to 300 to 400 properties to manage.
At Red Gum, each individual property manager manages multiple properties. They are fully responsible for everything to do with your property. They are available to talk with you and manage your property management needs.
Usually the management fee is around 7%; that is 7% of the weekly rent. On top of that there are other fees including: letting fees, advertising fees, admin fees, EOFY statement fees and routine inspection fees.
All fees charged need to be in writing in the Form 6 agreement between you and the agency. It can be tricky to understand all the fees and sometimes they are in different locations in the paperwork so it pays to look in detail at your agreement before you sign.
At Red Gum there is only one fee. That is a 5% management fee; that is 5% of the weekly rent. There are no other charges to you. There are no letting fees, no advertising fees, no admin fees, no EOFY statement fees. No other fees.
- Confirm you definitely want to rent your property
- Confirm in what time frame you want to rent it – when you would like the tenants to move in
- Assess your insurance needs (see FAQ)
- Think about what rent you’d like
- Think about what you value and need in a property manager
- Decide which property manager to use
- Check the property to make sure all compliance requirements are met (see FAQ)
- Confirm what furniture, if any, to leave behind (see FAQ)
- Ensure the property is looking the best it ever has for professional photos, video and 3D virtual tour footage
- Advertise with your property manager
- Assess the market and tenants
- Find the best tenant
- Make sure the conditions in the lease agreement match what you want, what was agreed, and check all potential grey areas
- Make sure your property manager is doing their job
- Check your rental statements and inspection reports and communicate regularly with your property manager
- Sit back, wait for the rent to come in and get on with your life.
There is a long list of compliance requirements that grows each year. We have listed some of the main ones below.
Generally they need to be in every bedroom and hallway. The rules are very specific about their location and the type of smoke alarms.
There must be an electrical safety switch on the main switch board.
Curtain Cord Safety
All curtain cords need to be attached to prevent a strangulation hazard. The guidelines are very specific about the height and way they are attached.
To charge tenants water usage, certain taps and shower heads must meet a WELS 3 rating and toilets must be dual flush and also meet a certain level of efficiency.
Minimum Housing Standards
The property must have privacy screens on certain windows and certain windows must have locks. There are also requirements relating to the structure of the building and mould issues. The guidelines are quite specific about the requirements.
Pool Safety Compliance
Pools must have a current safety certificate before they are rented.
The main areas to check are ID, rental history and income.
- The tenant’s identity needs to be verified.
- The tenants rental history is very important in order to view their track record. This includes calling previous landlords and agencies, doing a tenancy database check and any other rental history checks that are relevant.
- The tenant’s income needs to be at a certain level for them to be able to afford the rent. Evidence of this is crucial. Personal references can also be useful.
There are a number of ways to keep track of rent – you can:
- monitor your banking account
- request statements from your property manager to be sent regularly
- request receipts from the property manager when rent is transferred
- monitor all property management activity through the online portal.
The two variables are when the tenants pay the rent and when the agency forwards the rent to you.
Tenants are required to pay rent when it’s due. The agency you use will usually pay it forward to you monthly.
At Red Gum Property Management we pay it weekly.
Some owners like to pay the bills themselves while some like their property manager to pay the bills for them. This can easily be organised with the council or the body corporate. The caveat here is to make sure you choose the right property manager before doing this. It will be their responsibility to make sure they receive and pay the bills on time every time.
A 12 months lease works for long term tenancies. This can change with individual circumstances. Twelve months is enough time for a tenant to feel they need to look after the property as their own and really settle in. However, it’s also not so long that it could effect rent increases or ending relationships that are just not working out.
In Queensland, you can only legally increase the rent once every 12 months. Rents move quickly so it’s advisable to assess what the rent is every 12 months.
When thinking about insurance, think about worst case scenarios.
- What if my house burnt down?
- What if a drug den was opened in my property?
- What if the tenants had an accident at my property?
- What if the tenants left and didn’t pay rent for 2 months?
These are the things we all worry about. It’s worth asking yourself, would you be covered? Most properties will have building insurance as it’s required by the bank. Other insurances, like additional types of building and landlords insurance, will cover you in the small chance something unforeseen happens.
Tenants pay for water if your property is individually metered. This is agreed in writing in the lease. If the agreement does not state water usage can be passed, then the tenants can also not be charged for water.
Your property needs to be water efficient to pass on water usage.
Properties that are individually metered receive a separate bill from council. If you have a property managed by a body corporate where the water is split between all lot owners, water usage can’t be passed on.
If the property has old style taps, showers and toilets that don’t meet the WELS 3 rating of 9 litres of water flow per minute, water usage can’t be passed on.
Tenants maintain the property and this includes the gardens. Things that require a level of skill, expertise, and professional equipment are not the tenant’s responsibility. For example, keeping hedges trimmed below head height is generally the tenant’s responsibility. Cutting down trees that require being on a ladder is not the tenants responsibility.
- Finding good tenants who stay a long time and look after the property.
A week without rent means a big difference to your bottom line.
Having tenants look after your property will save you a lot of money on maintenance.
Tenants who make a home of your investment property are your second best business partners (after your property manager).
- Great advertising will attract the best tenants. Fuzzy pictures, pictures on an angle, an introduction to the property in poor English and an unhelpful property manager will only make finding good tenants that much harder.
- The details of your property management fees add up over the years. Get the best deal you can.
There are generally two types of maintenance. Wear and tear and tenant caused damage.
Wear and tear is covered by the owner. This can include a tap leaking as the seals wear out from use.
Damage caused by a tenant might be moving furniture around and putting a hole in the wall. This type of damage is repaired by the tenant at their cost.
Communication is key to making all attempts possible to resolve any issues and make sure the rent is paid.
- A tenant needs to provide evidence the money has left their account by the day it is due or the tenant will be in arrears
- At this point the property manager needs to follow up and find out why the rent is late
- If the rent becomes 7 days in arrears, the property manager should issue a notice to the tenant
- At 14 days behind in rent, the tenant can be given a notice to vacate the property
- The next step is a hearing with the tribunal called QCAT.
This is a summary of the general procedure and there are other steps and considerations. Your property manager is a crucial part of making sure the rent is paid on time.
A tenant signs a lease agreement and, regardless of the sale, the tenant is legally permitted to stay on at the property on the same terms set out in the lease.
Generally, Yes. There are certain times when an owner can say no, and certain conditions an owner can require of tenants who have pets. The owner must let the tenant know within 14 days of a pet request.
The tenant cannot make changes to the structure of the property without the owner’s permission.
Anything an owner leaves behind in the property will be considered a part of the tenancy and something the owner needs to maintain. For example, if the owner leaves a dishwasher, the owner needs to replace the dishwasher if it breaks due to wear and tear.