Hello,
I have a few questions that I desperately need answered.
I have an IP that I have put up for rent on Gumtree. It has received an enormous amount of interest from people that wish to rent it. What I need to know is pretty much everything…
- Do I need to get a contract/agreement done up to cover myself?
- Who pays for water/electricity?
- What dangers haven't I considered?
I have never rented out a property to a Tennant as I've always built homes to sell. I really have no idea and need some direction to save getting burned down the track.
Thanks in advance.
From my experience I would say DON'T DO IT.
I am having ongoing issues with a privately rented place and I will never do it privately again. The tenants are not paying rent, the place looks terrible and now I have to make a decision on whether I kick them out and go through a PM or hold out and hope what they are promising me comes to pass.
FWIW, I have a standard rental agreement in place, lodged bond ect. Most of this stuff you can find pretty easily with a google search. They pay water and electricity (the property is in Vic).
Good luck.
Wow, ok, good advice.
I was worried about all the things you mentioned. I wonder if it'd be better to get a steady tennant through a PM and then drop the PM once I see that the tennants are doing the right thing…
Hi Bullet46,
When it comes to renting out a property it is essential to get it right from the start
Once a tenant moves into a property it can be quite difficult to evict them as the Residential Tenancy Act works more in the favor of tenants
bullet46 wrote:Do I need to get a contract/agreement done up to cover myself?
Definitely! Without one it will be very difficult to establish or enforce your rights.
bullet46 wrote:Who pays for water/electricity?
The tenant, as they are the one using the water and electricity (But landlord has to pay council rates)
bullet46 wrote:What dangers haven't I considered?
As stated earlier, you need to ensure you get the right tenant from the start
You want a tenant that…
- Will pay the rent on time
- That will be considerate of neighbors
- And that that will look after a property
Hope that helps,
Kong
Forget the small change issues an even bigger issue is getting insurance coverage, with public liability included, for a privately managed rental.
What happens is your tenant injures themselves in/on your property and launches legal action because they injured themselves?
Do not go without a PM! Even if you are a fully qualified PM yourself i wouldn't do it. Use professionals all the time. All costs, as minor as they are for the job they do, are tax deductible. Would you do your own accounting? Would you do your own conveyancing? Utilise the professionals who are trained in their field. It makes even more sense if you can find professionals who also have interest in property investing. They know exactly what needs to be done. The small costs associated with using professionals far outweighs any problems you may have to deal with if you don't know what you are doing.
Goodluck with it all. Also, if you've had a lot of interest on Gumtree then surely you will get a great tenant through a PM who will interview all possible candidates.
My wife manages our local IPs.
It's not for everyone.
We only ended up going down this path because it was a hassle finding decent PMs.
It's worked out well for us – and we haven't experienced too many serious issues. Whenever we'd had a problem – we've quickly rectified it, including one visit to the tenancy tribunal.
You do need to be on top of the tenancy laws in your state – and if an issue arises, document everything and follow every process.
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
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