Common Questions Landlords in Adelaide Ask - FAQs About Property Investment

Surprising things even seasoned landlords may not know.

Property management in South Australia can be complex - whether you're an experienced landlord or just starting out - with constant updates and changes occurring all the time.

Here, we shed light on some of the most common questions we get asked as property managers, and arm you with the insights needed to navigate the market confidently as you build your property portfolio.

1. There have been maintenance issues at my investment property. What are my obligations as a landlord?

When it comes to maintenance issues, understanding the division of responsibilities between landlords and tenants is important.

That’s because often, landlords and tenants share these responsibilities to some degree.

While both parties have roles to play, as a landlord in South Australia, your primary duty is to ensure the property is well-maintained and safe.

This includes fixing major issues that affect the habitability of the property, and addressing significant maintenance issues such as electrical faults, power outages, water leaks or issues with the property's structural integrity.

It also means attending to urgent repairs - like gas leaks - as quickly as possible.

For everyday maintenance, like cleaning dishwasher filters and general garden upkeep, the responsibility typically falls to the tenant.

But because the distinction between minor and major repairs can sometimes blur, communication with your tenant is key to a swift resolution.

Given the complexities and time demands of managing property maintenance, particularly when balancing multiple properties or commitments, enlisting the help of a seasoned property manager can be a game-changer.

They can lift the maintenance burden and ensure that all issues, big or small, are handled promptly and in compliance with South Australian tenancy laws.

2. I have a great tenant but need to increase the rent. How can I negotiate so I don’t lose them?

Given the ever-evolving and rapidly changing nature of today’s rental market, rising costs and market adjustments may necessitate a rent increase.

But if you’ve got a great tenant, how do you approach it without the risk of losing them?

Clear and proactive communication is your best strategy here.

Firstly, start the conversation early to give your tenants plenty of notice about the upcoming change. This way, they won’t feel blindsided and can plan their finances accordingly.

It's also important to explain the reasons behind the rent increase, whether it’s due to rising maintenance costs, insurance premiums or property tax adjustments.

This openness helps build understanding and trust.

Adding value is also a smart move.

If you’re planning improvements or adding new perks to the property, coincide these with the rent increase. Maybe it’s time for a kitchen revamp, a repaint or faster internet as part of the deal?

This approach not only softens the impact but also reinforces the value your tenants are getting for their money.

Engaging an experienced property manager to navigate this process ensures that rent adjustments are fair, justified and communicated effectively.

They can expertly negotiate these sensitive discussions on your behalf, ensuring a smooth transition for everyone involved.

With their help, you’re not just keeping your excellent tenants on side - you’ll make sure they’re happy to stay.

3. Do I have to allow pets at my investment property? And if not, should I?

Deciding whether to allow tenants to have pets at your property involves balancing the pros and cons.

On the upside, allowing pets can significantly broaden your pool of potential tenants and may even justify a higher rent.

However, it's essential to weigh these benefits against the risk of potential damage to your property.

In South Australia, the decision to permit pets currently rests with landlords, but imminent changes to the Residential Tenancies (Miscellaneous) Amendment Act 2023 will include the clause that landlords will not be allowed to “unreasonably refuse a tenant’s application to keep a pet in a rental property, provided the tenant agrees to comply with any reasonable conditions imposed by the landlord.”*

What does this mean? If you do choose to make your property pet-friendly, it will be wise to establish a clear pet policy from the beginning.

This policy should outline any conditions or limitations - such as the types or sizes of pets allowed - to protect your property while accepting tenants with pets.

“Reasonable conditions” include things like stipulating pets need to be kept outside if they are not indoor appropriate, and/or requiring carpets to be professionally cleaned at the end of the tenancy.

If you’re unsure what conditions to set, a property manager can help you draft a pet agreement that covers all bases and help include reasonable conditions to ensure your property is well-maintained.

And remember - whether there’s a pet present in your property or not – you or your property manager will still have the right to inspect the condition of the property regularly.

*Source: https://www.cbs.sa.gov.au/campaigns/review-of-sas-renting-laws

4. Can my tenant allow a friend to move in? What are the rules around tenants sub-letting my property?

In South Australia, the rules around sub-letting and additional occupants are designed to protect both landlords and tenants.

However, as of March 1^st, 2024 - in response to the escalating housing crisis - new laws were passed that state a landlord is not allowed to unreasonably refuse a tenant wanting to sub-let a property.*

How does it work? While primary tenants (also known as head tenants) are legally responsible for the lease agreement with you, sub-tenants usually have a separate lease agreement with the head tenant.

It’s important to note that sub-tenants are not protected by the same rights and responsibilities as the head tenant, but that bond lodgment forms do require amendment to include their name.

Of course, it can get tricky, especially when a primary tenant wants to leave, but the sub-tenant doesn’t.

While a sub-tenant is able to request to take over the lease, by law, the primary tenant is still obligated to meet all the lease conditions until this happens. For example, if they leave without ensuring rent is paid, they can be in breach of their lease agreement and subject to penalties.

And if things get out of hand with a messy sub-letting situation? It pays to get advice from CBS, lodge an application with the South Australian Civil and Administrative Tribunal (SACAT), or lean on an experienced property manager to help sort things out.

*Source: https://www.cbs.sa.gov.au/campaigns/review-of-sas-renting-laws

5. Landlords can claim unpaid rent from a bond, but can they claim other unpaid bills too?

In South Australia, the bond serves as a financial safety net for landlords, covering potential unpaid rent and other specific expenses - like damage - caused by tenants.

But when it comes to recouping costs for unpaid bills such as water or internet, the process can be nuanced.

Essentially, in South Australia, landlords can claim for:*

· unpaid rent

· unpaid water supply charges

· repair costs for damage caused by the tenant or resident

· cleaning costs

· cost of re-letting if the tenant or resident leaves before the end of the lease.

For anything outside of this to be claimed - including things like internet - it must have been explicitly mentioned in the original lease agreement.

That’s because, without clear terms about who was to bear the cost, claiming these additional expenses from the bond can become extra tricky.

Property managers can help draft lease agreements that clearly articulate all tenant responsibilities to make sure you, as a landlord, are covered. And if they’re not? They can handle the claim process professionally.

*Source: https://www.sa.gov.au/topics/housing/renting-and-letting/residential-bonds/bond-refunds

6. What does the average Property Manager charge in Adelaide? And is comparing fees enough?

When choosing a property manager for your rental, fees are an important consideration, but they shouldn't be the only factor.

Look for value over cost.

A good property manager offers a comprehensive range of services that can save you time and money in the long run.

Here's a breakdown of what you might expect a property manager in Adelaide, on average, to charge - and why these fees matter:

· Average Management Fees: Property management fees in Adelaide typically range from 7% to 11% of the monthly rent collected. This rate can vary based on the property's location, the services offered and the property management agency’s expertise and reputation.

· Leasing Fees: When a new tenant is placed, leasing fees come into play, often equating to 2 - 3 week’s rent. This fee covers the cost of conducting viewings, screening tenants and preparing lease documents, as well as initial in-going / out-going property inspections, reports and bond lodgements.

· Advertising & Marketing: This fee can vary greatly between agencies depending on what it includes. Think about everything associated with securing a new tenant: advertising, marketing, online listing fees, professional photography and social media.

· Renewal Fees: For renewing a tenant's lease, property managers might charge a renewal fee. This could be a flat rate or a percentage of the monthly rent.

· Additional Services: Additional services such as court appearances, eviction processing or special property inspections may incur extra charges. These fees can vary greatly but provide essential support in challenging situations.

While it might be tempting to choose a property manager based on the lowest fees, the value of the service provided is actually key to making a sound decision.

Just like you wouldn’t install those dodgy, dirt-cheap brakes on your car, you shouldn’t choose a cut-price agent to look after what is likely your most valuable asset.

That’s because a good property manager worth their salt will not only handle day-to-day operations but also offer strategic advice to maximise your investment's profitability and maximise your profit over time.

The right property manager saves you time and stress, mitigates risks and offers additional value through expert market insights and tenant management.

So it pays to look beyond the fees and consider the benefits - and peace of mind - you get from having a professional manage your investment.

Property investment in South Australia comes with its own unique set of challenges and learning curves, with every aspect demanding attention.

But engaging the right property manager is a smart move for your investment.

And with We Connect Property on your side, you’re set.

We’ll equip you with the knowledge and tools to avoid common pitfalls and enhance your investment's potential, ensuring your property investment journey is both profitable and hassle-free.

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And if you’d like some expert guidance and support? We’re ready and waiting to answer all your questions!

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

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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.