Frequently Asked Questions About Property Investment (Part 2)

Surprising things even seasoned landlords may not know!

As experienced property managers, we understand that being a landlord can be both exciting and daunting.

Whether it’s your first foray into property investing, or your fifth, undoubtedly there’s always new questions popping up.

And with so many aspects to consider, from managing tenants to maintaining your property, it's no wonder!

Here, in our next instalment, we've compiled even more questions we often get from landlords, and answer them so you can feel more confident in your property investment journey.

So let's dive into these six very common property investment questions!

Can I switch property management agencies whilst my property is currently tenanted?

Absolutely!

As a property owner, you have the freedom to switch property management agencies whenever you like, even if your investment property is currently tenanted.

That’s because tenant contracts are tied to the property, not the property management agency.

In fact, if you do decide to switch, it’s a fairly straightforward process, for both you and your tenants.

So why might you consider switching property managers?

Maybe your property manager is cheap, but only offers a limited service. Or maybe they’re expensive, and you just don’t feel the value is there. Perhaps they’re not conducting inspections as regularly as you like, the rent is always late into your account, or you’re just not feeling like they value your business.

Whatever the reason, switching agencies can often lead to a better property management experience.

But before making the decision to switch property managers, talk to your current property manager first to see if they can provide additional benefits, improve their service or fix the issue.

They may be able to offer a better rate or more frequent inspections. And if you’ve got multiple properties, why not see if they can consolidate your fees into a cheaper, or more valuable package.

If you’re still not happy, hunt around for a property manager that better suits your needs.

The great thing? Any new property manager will be able to guide you through the process of changing over, so it’s stress-free for you (and your tenant).

By exploring all your options, you can ensure that you're getting the most value from your property management contract, and may just find yourself happier with the service you receive.

Can I sell my investment property while it is tenanted?

Yes, you can sell your investment property while it’s tenanted, even during a fixed-term lease.

No matter the reason, as a property owner you have the right to sell your property whenever you see fit.

But there are some important regulations to keep in mind, to make sure you stay on the right side of the law:

✔ First, it’s essential to provide written notice to your tenant/s of your intention to sell the property within 14 days of entering into an agency agreement to sell the property.

✔ Second, your property can’t be advertised or shown to prospective buyers within these 14 days. And when it can be shown, the rules state no open inspections more than twice every 7 days, unless the tenant agrees to more.

✔ Third, when it comes to marketing your property, a tenant can refuse to have their personal belongings photographed for listings, if they feel it will compromise their privacy.

✔ And finally, once a contract of sale is signed, written notice must again be given at least 14 days before the settlement date, or as soon as possible if settlement is sooner than that.

If you want to keep your reputation as a great landlord intact, the best thing you can do is give your tenant more notice than necessary wherever possible, communicate with them regularly and respect their boundaries when it comes to entering the property - after all, it’s their home for now.

And if you want to make sure the process runs smoothly? Ensure you work with a real estate agent that has experience selling tenanted properties.

Often, your property management agency has selling agents too, and that’s a great place to start - they likely have the knowledge and well-honed skills necessary to deal with this sort of sale.

What types of property maintenance are a landlord's responsibility?

When it comes to investment properties, both landlords and tenants typically share responsibility for repairs and maintenance.

But knowing who is responsible for various repairs and maintenance tasks can be challenging.

So, how can you figure out who should handle which tasks?

While there are a few grey areas, it’s fairly clear-cut.

Landlords usually take care of things the bigger things - like structural repairs, appliances that stay with the home like ovens, dishwashers and air conditioners, plus more substantial gardening or yard work like landscaping, pruning trees and cleaning gutters.

Landlords are also in charge of pest control, making sure white ants, birds and other major pests aren’t an ongoing problem.

Ensuring the property is secure is also a landlord-assigned task, so fixing broken locks is their job. But if tenants lose their key? They’ll cop replacement costs, plus any outlay that comes with gaining access to the home.

One final landlord obligation - and an incredibly important one at that - is making sure all smoke alarms are in good working order, and that checks are conducted regularly.

So what about your tenants?

Tenants generally take care of household items, like cleaning air conditioner filters, minor pest control like setting mouse traps, and handling everyday gardening tasks like mowing and weeding.

They must also fix any damage they, their guests or pets cause to the property.

How does a property management agency screen tenant applicants?

To protect your investment, and achieve a good return, it’s crucial to find good tenants.

But unfortunately, especially in a rental market with plenty of prospective lodgers, it’s inevitable that you’ll come across many problem tenants before finding a good one.

And to make matters worse, some tenants even provide exaggerated - or even completely fake - information on their applications to help them jump the queue!

That’s why it’s essential to use a property manager who can cut through the guff and find the perfect tenant.

So how do they do it?

Any property manager worth their salt will:

✔ Pre-screen potential tenants by asking simple questions on their initial application, about things like pets and will drop background checks into the conversation. This often helps weed out unsuitable tenants upfront

✔ Keep an eye on applicants at the inspection. A quick, informal chat can provide insights into their job stability, moving habits, rental history and how they might treat the property.

✔ Seek references - and actually call them - to verify the applicant's background and rental history

✔ Most importantly, they will conduct all the necessary background, using professional tenancy databases only accessible to licenced agents, that provide accurate information on prospective tenants

But the most proactive thing you can do? Use an experienced property manager with excellent references.

Not only will they be savvy with all the rules and regulations and make great recommendations, they’ll also have a proven track record of managing rental properties effectively.

How do you find them? On sites like Rate My Agent, Australia's No. 1 real estate agent rating website, where real landlords list real reviews for property managers they’ve worked with.

How clean and tidy should my investment property be before a new tenant moves in?

As a landlord, it's your responsibility to ensure your investment property is clean before new tenants move in.

Yet, one of the most common ‘day one’ complaints we get is from tenants complaining about a property not being spick and span!

Addressing cleanliness issues upfront helps prevent this, and sets the stage for a smooth, headache-free tenancy.

And while the bare minimum specifies keeping the premises safe, clean and hygienic, you should ensure that:

✔ Carpets are clean and free of major stains, hair and other muck

✔ There’s no dust, filth, or other contaminants on walls, floors, benchtops or other surfaces

✔ All ducts, vents, and grills are squeaky clean.

✔ There’s no mould anywhere in the home, especially bed and bathrooms

✔ Pests, such as cockroaches, rodents, and bedbugs, have been stamped out.

✔ Cabinets, closets, and other storage items are clean inside and out.

✔ Windows and frames are clean.

✔ The kitchen and bathroom are clean and odour-free.

But the biggest reason to make sure your property’s in tip-top shape before new tenants move in?

When they move out, the home must be left in the same condition it was found (minus reasonable ‘wear and tear’).

Not only that - if a tenant moves into a house that’s clean and tidy, they immediately know the standard you’d like it maintained - so are more likely to keep it that way throughout their tenancy.

With that in mind, our tip for a smooth start is to hire a professional cleaner to come in and give your property a thorough once-over prior to every new lease.

This one small investment can be the first step to building a positive landlord-tenant relationship from the get-go.

Do I need Landlords Insurance for my investment property?

Yes, yes, YES! Having Landlords Insurance is THE best way you can protect your investment property.

Why?

Because tenant circumstances change and damage can occur - even natural disasters pose a risk!

Having Landlord Insurance can save you thousands upon thousands of dollars if (and when) things go wrong.

But before choosing a policy, it pays to keep in mind that not all are created equal, so do your research.

Always read the fine print (yes, even the REALLY small fine print) before choosing a policy, so you’re not caught out on a technicality when you’re at your most vulnerable.

As a guide, any good Landlords Insurance policy should offer:

✔ $20M public liability to cover your tenant, or anyone else, who is injured on your property

✔ Low excess - many specialist insurance companies offer zero excess, while some bank-issues insurance policies can sometimes have excesses exceeding one month’s rent!

✔ Income cover can occur when tenants are unable (or unwilling) to meet their rental obligations

✔ Legal liability to cover tenant disputes that have to go to court, or even things like property tax audits

✔ Accidental damage is crucial, as it’s one of the most common issues rental properties experience -most tenants don’t deliberately cause damage, but accidents do happen!

✔ Malicious damage & theft - because sometimes landlords make poor tenant choices

✔ Contents. Although it’s a tenant’s responsibility to insure their own belongings, make sure that your policy covers items like carpets, blinds, lighting and permanent appliances like ovens, dishwashers and heaters

✔ Pet Damage is definitely worth having, as state tribunals don’t always favour landlords when it comes to damage caused by furry or feathered friends

✔ Natural disasters and general catastrophes are an - albeit rare - fact of life. It’s always better to be safe than sorry when it comes to protecting your investment property.

The best way to make sure you’re choosing the Landlords Insurance that’s right for you and your circumstances? Seek professional advice.

Deal only with reputable insurance companies, and consider consulting an experienced property manager who understands your needs.

For instance, We Connect Property have been managing properties for many years and there’s not much we haven’t seen. We know what can go wrong, what properties like yours require, and can guide you in the right direction. We can even arrange a tailored insurance quote on your behalf.

And once you’ve found the right Landlords Insurance? You’ll rest easy knowing your investment property is well protected.

Owning an investment property is an exciting journey, filled with potential for exceptional rewards and long-term financial growth.

But let's face it, being a landlord can be a minefield, with plenty of new things to learn along the way. That's where having the right advice and guidance can be a game-changer.

Teaming up with an experienced property management agency like We Connect Property is your ticket to navigating the investment property maze.

We provide all the expertise you need to achieve the best returns and confidently face the challenges and opportunities that come your way, all while avoiding common property investing pitfalls.

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As property experts with over 21+ years combined experience in buying, selling and managing property in Adelaide, We Connect Property are ready and waiting to offer expert guidance and support when you need it most, and answer all your questions about property investing.

Check out our 5 star Google reviews here to find out what our happy clients think!

And if you’re just getting started, or looking for valuable property investment, buying or selling tips, tricks and advice?

Check out these other handy articles on our blog:

Give us a call on 0403 799 983 today, or drop a line to sales@weconnectproperty.com.au - we can’t wait to chat!

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DISCLAIMER: All recommendations made by We Connect Property are general in nature and not to be relied upon as legal or financial advice. To ensure accuracy, we always strongly recommend seeking independent, professional advice tailored to your specific situation before making any investment or financial decisions.