Thursday, February 25, 2010

Property investors, test your knowledge...

Two weeks ago we wrote of the landlord’s requirement to provide their full name and address (via lease documents) to their tenant, as well as notifying them of any change of name and address within 14 days.

Today... we have a short quiz for you.

Scenario 1: You want to lease a house with a dishwasher in it, but it’s not operational. You have a tenant who wants to lease the property “as is”, without a working dishwasher, to save a few dollars. You are completely transparent in telling them the dishwasher doesn’t work, and on agreement, document this in the lease as a condition of taking the property.

Can the tenant subsequently enforce you to have it repaired or replaced?
Section 68 of the Residential Tenancies Act, landlord’s obligation to repair, requires the dishwasher to be repaired or replaced, stating this cannot be written out of the agreement. The same applies to air conditioners, heaters and any fixed appliance. Effectively as a landlord you need to physically remove the appliance, in this case the dishwasher, to be completely safe.

Scenario 2: A tenant ‘skips’ leaving unpaid rent, rubbish and abandoned goods.

Can a tenant’s goods be dumped immediately after they have abandoned the premises?
Abandoned Goods, Section 97, prescribes that if the tenant ‘does a runner’ and leaves goods at the property, the Landlord has an obligation to track down the tenant and if necessary store the goods for a minimum of 60 days then publish in the state newspaper notification of this. So... the Landlord incurs loss of rent, reletting fees, costs for advertising, storage and to auction the goods. Then if sold for more than the reasonable costs incurred, the landlord must pay any balance to the Office of Consumer and Business Affairs.

Scenario 3: A tenant says they are a keen gardener and, as a consequence, rents the premises from the Landlord at a discounted rate. A condition of the tenancy is that they agree to completely take care of the garden.

Who does the pruning?
Any ‘specialist’ work in the garden, such as pruning, cannot be enforced by the Landlord, irrespective of what agreement is otherwise reached.

When it comes to managing property, there are hundreds of examples where common sense doesn’t cut it. From my observations and landlord feedback received, the Act needs modernising or we will see rents rise to cover the increased risk to investors.

It’s election time so get your politicians to look at modernising SA’s Residential Tenancies Act, to make it more competitive in the national housing market and more user friendly for all parties. A great start would be to get out of the dark ages and move to lodging documents electronically. This is, after all, 2010!

Be sure to see www.toop.tv for more on the Tenancies Act, including discussions over the next 3 weeks with Deputy Premier Kevin Foley about this and much more. Want to share your experiences? Log onto www.asktoopie.toop.com.au




Anthony Toop, Managing Director.


www.toop.com.au


© Toop Real Estate Group

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