The article below appeared today in the news.com.au real estate section and is a timely reminder of the financial drain that some people can find themselves in over the Christmas period. When it comes to weighing up between the many costs of surviving Christmas or paying rent on time the landlord can often be the loser ending up with a nasty new year surprise! The key lesson mentioned in the article and one that I fully support is to ensure that you utilise the services of a professional property manager, they are are worth every cent when something goes wrong and they know exactly what to do about it, after all, that’s their specialty. Read on below or click here to go to the original article –
THE festive season is a danger period for property investors, and real estate experts are warning landlords to make sure they don’t suffer a financial hit from tardy tenants.
The general manager of Harris Property Management, Suzie Hamilton-Flanagan, says rental arrears can jump by more than 20 per cent over Christmas as tenants find other areas to spend money. ‘Sometimes rent is the last thing on their list,” she says. ‘Landlords managing their own properties need to make sure they are on top of this from the start, or they risk paying for their tenant’s good cheer.” Some landlord insurance policies provide cover for tenants who fail to pay, but Hamilton-Flanagan says if a landlord fails to go through the correct processes when dealing with late-paying tenants, ‘an insurance payout for a late rental claim can be impacted”. She says one suggestion during December may be to send the tenants a card, perhaps with a small gift, gently reminding them of payment dates during the busy Christmas season. ‘Create a relationship with the tenant and treat people as you would want to be treated. The mentality of a tenant is they are paying you this money and they want bang for their buck – they want the property maintained, repaired and the landlord to be respectful.” The first step in preventing late payment is to select the right tenant from the start, Hamilton-Flanagan says, which involves checking a tenant’s payment history by contacting previous agents and landlords.
Carolyn Majda, executive manager at landlord insurer Terri Scheer Insurance, says one of the best ways to protect yourself is to use a professional property manager. ‘That way you have someone who is looking after the rent religiously,” she says. Majda says a lot of property managers send out pre-Christmas newsletters with rental payment dates included. ‘It’s nice to send a Christmas card – we all lose track of dates around this time of the year.” She says investors who manage a property themselves need to be on top of any late payments immediately. ‘Don’t let it start accruing. The longer time goes, the bigger the problem for both landlord and tenant,” Majda says.’Even if it is a day late, be on top of it.’It’s also really important that you take out insurance at the start of a tenancy, before you have people in there, because if they are behind in their rent it can create some issues – it’s almost like having a car accident and then insuring your car.”
The original version of this article appears here