10 Rental Mistakes First Time Property Investors Make

by ANREPS In Property Management

28 March 2017

There are some good points in this article by Paul Bennion on Residential Property Manager (link to full article at bottom of this post) who claims the biggest mistake of first time property investors, who choose to manage their properties themselves, is not conducting a thorough background check on tenants. But that is not their only mistake he says. Here are nine others.

 

1. Price

Rents are inflated, thereby reducing the number of potential tenants. By lowering the rental price by a small amount, a landlord can substantially increase the pool of potential tenants from which to select a reliable person to lease the property.

2. Contract errors

The necessary contracts are incorrectly completed, names are spelt wrongly and the contract is not correctly witnessed. These errors can make the contract invalid.

3. Verbal agreements

Landlords make verbals agreements on matters such as rental payments which are invalid if they are subsequently challenged by the tenant.

4. Bonds

A common mistake is failing to properly lodge the bond money or failing to collect the right amount of bond money. Bond money is critical if the tenant breaks the lease or causes damage in the property.

5. Friendships

The landlord develops a friendship with the tenants, which makes it difficult for them to take action if the tenant breaks the contract. Leasing a property is a commercial arrangement and landlords should take a professional approach to it.

6. Maintenance problems

Maintenance problems have to be addressed quickly to ensure good tenants remain happy. Landlords who argue with tenants over maintenance problems may find it difficult to retain good tenants or maintain regular rental payments from their tenants.

7. Termination

Landlords follow the wrong procedures when terminating the lease. Generally, not enough notice is given or the notice given is not in writing. There are set procedures that must take place if the landlord wishes to evict a tenant.

8. Insurance

Not taking out the necessary insurance cover to protect the landlord if there are problems with the tenancy.

9. Tax

Not fully claiming tax depreciation benefits which can be equivalent to 60 per cent of the total purchase price of the property.

 

Full article:

http://www.rpmonline.com.au/blogs/15181-10-rental-mistakes-first-time-property-investors-make?utm_source=ResidentialPropertyManager&utm_campaign=24_03_17&utm_medium=email&utm_content=1

 

 


Tags: anreps, investment property, property management, real estate, rental property

Comments (0)


Financial New Year Resolution

by ANREPS In Property Management, Uncategorized

14 February 2017

post-it

Many people make New Year’s resolutions, but we suggest you make a Financial New Year Resolution!

If you have an investment property there are expenses you can claim at tax time. The start of the year is a good time to take a look at these so you can be prepared when the new Financial Year comes around in July.

There are a lot of costs associated with owning an investment property. However, you can claim a deduction for particular expenses for the period your property is rented or is available for rent.

A tax accountant will be able to advise you specifically, but we have listed some examples below to give you an idea.
Some expenses like management costs and maintenance, can generally be claimed immediately, that is, deducted against your current year’s income. Other costs, such as borrowing expenses, depreciation and capital works spending can be deducted over a number of years. Ask your accountant how to obtain a depreciation schedule for these items.

Expenses for which you may be entitled to claim an immediate deduction include:
  • advertising for tenants
  • body corporate fees and charges
  • council rates
  • water charges
  • land tax
  • cleaning
  • gardening and lawn mowing
  • pest control
  • insurance (building, contents, public liability)
  • interest expenses
  • property agent’s fees and commission
  • repairs and maintenance
  • some legal expenses
  • travel undertaken to inspect the property, to collect the rent or for maintenance.
So make sure you keep all receipts for tax time.
There is also detailed information on the Australian Taxation Office website https://www.ato.gov.au/General/Property/Residential-rental-properties/Expenses-you-can-claim/

Tags: ato, finance, landlord, new year, property management, real estate, rental property, tax time, western australia

Comments (0)


Common Questions about Selling Property in WA – Part 3

by ANREPS In Buying and Selling, General Information

13 February 2017

Here is the third question in our Common Questions series.

Question:

Are there standards of repairs and cleanliness? Do you need to have a professional clean or is it up to the new owner? And are they buying the house as is or does everything need to be fixed and in working order?

Answer:

Regarding cleanliness, the house should be in the same condition at settlement as when the buyer inspected it – unless a special condition has been attached to the contract specifying what is to be done prior to. You don’t have to use a professional cleaner but most sellers would at least have carpets professionally cleaned.cleaning

If there is something in the house not in working order, you should make the buyer aware and note it on the contract. A common one is the automatic ignitor on a gas stove. If a seller chooses not to fix it, this should be noted for the buyer so they can choose to accept ‘as is’.

The buyer is entitled to a final inspection during the week prior to settlement to check that the property is in the same condition as when first inspected. However, if a buyer had added a special condition requiring plumbing, electrical or mechanical items to be in working order, they would expect to be able to check those things are all working as they should and, if they are not, the seller will be required to fix them – before settlement. It is a good idea for a seller to check everything before this time to avoid any delays at settlement. For example, you may be used to a sliding door that doesn’t open easily or a window lock that is missing a key, but these need to be fixed or noted otherwise on the contract.

If you have any questions about selling property in Western Australia please use the Contact Us form on our website.


Tags: buying, cleaning, contract, perth, real estate, selling, selling property

Comments (0)


10 Simple Ways to Burglar Proof Your Home for Holidays

by ANREPS In General Information

25 November 2016

Once the frenzy of Christmas passes, there’s nothing better than escaping for a well-deserved break. And it’s only natural to want to pack up and head off as quickly as possible, but we need to remember one vital thing at this time of year. We leave behind us vacant homes filled with brand new gifts… and experienced burglars know it. PlayStations, iPads, jewellery and expensive toys that, if you’re making a rushed getaway, may still remain wrapped in their original packing—an invite too alluring for even the most virtuous thief.burglary-clipart-burglar_1

But do not fear! With some organisation and planning, there are some simple deterrents you can put in place to send burglars running and keep your home protected while you’re away:

1. Unplug garage door opener or change the code. Experienced burglars know that the garage door is usually the weakest point of entry. For extra security, unplug the garage door opener or change the access codes of your remote control. Many controls come with standard factory settings, which means your roller door is accessible to any remote with the same setting.

2. Organise timers for lights. Set timers to turn on both internal and external lights at varying times so that your home looks occupied. Bunnings have some great options.

3. Lock gates and windows. Install top quality deadbolt locks on exterior doors. Deadbolt locks should have anti-drill features, a horizontal bolt at least 1 inch long and a steel, bevelled casing to inhibit the use of a pipe wrench. Hire a locksmith or, if you know what to look for and you’re handy around the house, have a browse through The Lock Shop or Locks Galore to source.

4. Install a security system (or pretend you have one). Security alarms increase the fear and risk factors for intruders making them an effective deterrent. Clearly advertise your alarm outside your property. Unwanted intruders will likely move on to find an easier target. Make sure you choose suppliers and systems that meet both State ‎and Federal standards.

5. Mow your lawns and trim your bushes. Overgrown lawns can give the appearance your property is vacant. Tall shrubs and trees provide cover from the street. Leave your garden neat, trim back bushes and remove lower branches near windows that allow easy access.

6. Use exterior lighting with motion detectors. Put the spotlight on intruders to make them visible and vulnerable. Lighting triggered by motion detectors is also an effective way of alerting your neighbours of a possible intruder.

7. Organise a neighbour to collect your mail. Overflowing mailboxes are one of the biggest giveaways that you’re away. Either redirect or organise a neighbour to collect your mail on a daily basis.

8. Leave boxes for new items in garage or cupboard. You may think you’re being super efficient by leaving packaging and boxes out on the nature strip for collection while you’re away, but do you really want to advertise the brand new Xbox you were given for Christmas? Keep packaging for expensive electronics and toys hidden until you return.

9. Put away ladders, garden tools and hard objects. Burglars can use ladders and hard objects lying around your garden to break in via windows. Don’t make it easy for them.

10. Keep quiet. It’s tempting to announce to the world via social media that you’re at the airport waiting to fly out to Honolulu for an exotic 2-week holiday, but burglars can now access this information to identify vacant houses. Tell your friends in person, or send them a direct message.

The most important thing to remember is that you want your home to seem occupied. If you don’t have the time or funds to install expensive alarm systems, stick to the more basic points listed above. Every measure you take will give you peace of mind and reduce the risk of your home being broken into while you’re away.

After that, there’s nothing left to do but… have a great holiday!


Tags: burglary, Christmas, holidays, property, real estate, security, tips

Comments (0)


Common Questions About Selling Property in WA – Part 2

by ANREPS In Buying and Selling, Uncategorized

15 November 2016

Here is the second question in our ‘Common Questions’ series.

How do I know what’s considered attached to the house (eg included in the sale) and what happens if someone wants to buy your sofa or you want to leave a custom made piece of furniture behind for example?

ANSWER:

Fixtures and fittings included with the sale include anything fixed to the house and not easily removed, for example:
  • light fittings, but not free standing lamps
  • floor coverings like carpet, but not a rug you can easily take
  • window treatments such as fitted blinds or curtains
  • TV antenna
  • plants (not pot plants)
  • paving

A seller is entitled to keep a fixture, for example, curtains that match the furniture, although it needs to be noted on the contract.

The seller will need to make a note on the contract if they want to take these curtains and pelmet which match their furniture

The seller will need to make a note on the contract if they want to take these curtains and pelmet which match their furniture

A commonly disputed one is a dishwasher. If it is mounted under bench it is generally considered a fixture but if it is free standing or not screwed in it may not be deemed a fixture and the seller can take it. If in doubt, make a note on the contract and make sure the buyer knows your intention.

Alternatively, if something like custom made furniture is to remain you should also make a note of it on the contract and make the buyer aware.

If a buyer wants to buy something that is not part of the sale treat this separately, not as part of the house purchase. If you are willing to sell the item, agree a price with the buyer and receive payment before or after settlement. If paid for prior to settlement then note on the contract that the item has been purchased and will remain. The buyer would be advised to take photographs of the item.

Tags: common questions, contract, fittings, fixtures, property, real estate contract, selling, selling your home

Comments (0)


Garden Tips for Landlords

by ANREPS In Property Management

28 October 2016

People say you can always tell a rental property by the state of the garden and, unfortunately, it’s usually true.

So why do tenants sign up for a property with a lovely garden that needs a lot of looking after?

It’s because we’re all the same.  Everyone wants to live in a nice place often without realising the time effort and money that goes into gardening.

So what can you do to prevent this from happening and ensure your perfect garden is properly cared for?

Start Right

Get the garden in easy to maintain order at the outset.
  • Ensure reticulation* is in good working order and the tenant has sufficient instructions for easy use.
  • Contribute to the cost of Water Use during the watering season – say 50% for example.
  • Use waterwise plants that are unlikely to die after a few summer days with no water.
  • Mulch garden beds to discourage weeds and retain water.
  • Keep grassed areas simple, use edging to keep separate from garden beds.
  • Avoid climbers and other plants that grow rapidly and require a lot of pruning.
  • Don’t plant trees whose roots could invade the sewerage system or turn the paving into an earth quake zone. If they are already there, root them out now.
  • Contribute by spraying for broad-leafed weeds and fertilizing in early spring each year.

* If your garden requires regular watering and you have no automatic reticulation there is a variety of tap timers available which attach to an outdoor tap and can be set to water on your allotted watering days.

garden1

Overgrown garden

 

Easy care garden but watch for weeds in that mulch!

Easy care garden but watch for weeds in that mulch!

garden_2

Manicured garden – this is a lovely garden but would require a team of gardeners! Clearly this is not representative of a suburban rental property but if your property has plants, lawns or hedges that require specialist upkeep this should be addressed at the beginning of each new tenancy with responsibilities negotiated and accepted by everyone involved.


Tags: gardening, landlords, perth, property, property maintenance, real estate, tenants, tips

Comments (1)


Common Questions About Selling Property in WA – Part 1

by ANREPS In Buying and Selling, Uncategorized

21 October 2016

soldWe recently asked the Facebook community what they would most like information on with regard to selling and buying property in Western Australia.

After receiving some interesting responses we have decided to write separate posts for several of them. The answers given are based on the most common situations we encounter in residential real estate.

Here is the first one.

Question 1: What are the timelines for offers and settlement?

Answer: These can vary a lot depending on the type of offer you receive but common scenarios are:

Subject to finance offer: most buyers will require 21-28 days to obtain their unconditional finance approval from a lender. Once finance is approved, settlement usually occurs 21-28 days after.

Subject to sale: this is when the buyer has to sell their house in order to buy yours. A reasonable time to allow would be 8-10 weeks. If your buyers receive an offer you will then need to work with their time frame, they might have buyers who need to obtain finance.

If you feel this is too long a time to take your property off the market you can utilise a ’48 hr clause’ which will allow you to keep marketing your property. If you receive a better offer you can give the original buyers 48 hours notice to make their offer unconditional. If they can’t, you can proceed with the second buyer’s offer.

Cash offer: if it is a true cash offer you will need to allow 21-28 days for settlement.

 

We invite you to submit your own questions about real estate for us to write about. No question is too silly!!

homerBefore starting work in real estate one of our staff members thought Under Offer meant that the asking price had been reduced.

 

 


Tags: buying, buying your first home, cash offer, common questions, finance, perth, property, questions, real estate, sold, subject sale, under offer, western australia

Comments (0)


The Real Cost of Moving House

by ANREPS In Buying and Selling

30 August 2016

australian-money

If you haven’t bought or sold before, or even if you have, it can be hard to work out exactly how much it is going to cost. Fees to agents, government, pest inspectors . . . where does it start and end?

We have put together a guide below, using the median price for a residential house in Perth, which is currently $525,000 (REIWA, June quarter). Included are costs for buying and selling, and where helpful, there are links to calculators to help you work out your own costs.

Settlement agent fees were deregulated earlier this year. Previously they were calculated on a sliding scale depending on your sale/purchase price.  It is therefore advisable to get a few quotes for settlement as the fees can differ. We have used Vicki Philipoff Settlement Agents in our example as their fees are competitive and our clients say they have received excellent service.

Selling Your Home (approximate costs)

$12,860                 Real estate commission of 2.45% (WA Industry Average*) on $525,000

$2,000                   Marketing and real estate administration costs (an approximation as these fees vary)

$605                       Settlement Agent Fees (Vicki Philipoff special $550 fee plus $55 disbursements)

$200                       RCDs each (new legislation**)

$190                       Smoke Alarms each (hard wired – new legislation**)

Buying Your Home (approximate costs)

$935                       Settlement Agent Fees (Vicki Philipoff $880 fee plus $55 disbursements)

$18,952                 Stamp Duty

$441                       Other government fees (mortgage registration and transfer fees)

Optional charges:

$200                       Timber pest inspection (highly recommended)

$495                       Building inspection

 

Other costs you may encounter while buying and/or selling: preparing your house for sale, removal fees, mortgage discharge fee (check with your bank if applicable)

If you do some research before buying and selling you will be able to minimise some of these costs. The ones to shop around for are real estate agent commissions, settlement agent fees, RCD and smoke detectors, timber pest and building inspections and removal fees. Unfortunately you won’t be able to avoid the government fees!

REIWA have a simple Stamp Duty calculator to work out the applicable government fees, as these will vary depending on sale/purchase price, whether you are a first home buyer, or if it is an investment property.

http://reiwa.com.au/advice/calculator-tools/stamp-duty-calculator-wa/calculator

Of course, if you consider selling privately you can save a lot of money. To find out about ANREPS Private Sale Blueprint, visit http://anreps.com.au/private-sale or call Tony Wiles on 9450 3398 or  0411 513 021.

 

*Source: LocalAgentFinder

**For more information on the RCD legislation visit https://www.commerce.wa.gov.au/energysafety/rcd-fact-sheet and for smoke alarms you can find more information here https://www.dfes.wa.gov.au/safetyinformation/fire/fireinthehome/pages/smokealarmlegislativerequirements.aspx

 


Tags: agents, buying, commissions, perth, property, real estate, selling, western australia

Comments (0)


4 Types of Property Maintenance for Landlords

by ANREPS In Property Management

20 July 2016

As property managers one of our main duties, and most time consuming, is dealing with maintenance issues. Most of these are repairs to items that have broken or just stopped working.tradesperson

Plumbers, electricians and the handyman are required more than any other kind of tradesperson – leaky taps, lack of hot water, toilet cisterns overfilling are the most common requests for plumbers; faulty switches, light fittings, power points, cooktop burners that don’t work are common for electricians.  Then there are doors that don’t close, windows that won’t open, fans that stop working and door that fall off. Everyday someone has a problem somewhere.

Maintenance of an investment property is often considered only when something goes wrong but it is an umbrella term that covers four separate types of maintenance, according to Peter Gianoli of Investor Assist. Here is a summary of the four types:

  1. REPAIRS: reactive response when something goes wrong eg. Blocked pipe, broken oven – as mentioned above.
  2. SEASONAL MAINTENANCE:  items should be regularly addressed to ensure the number of repairs in the previous category is kept to a minimum. eg. Gutter clearing, air conditioner servicing, garden pruning, pest control.
  3. INVESTMENT MAINTENANCE:  planned replacement of any item in the property that depreciates in value, including carpets, blinds, ovens, hot water systems, etc. Planned maintenance prevents the further repairs that would otherwise fall into the first category, and enables a good level of control over the standard of the property and the cost of maintenance.
  4. CAPITAL WORKS: any new elements or improvements that are introduced to a property. Examples include adding a dishwasher, a new sprinkler system to enable tenants to look after the garden, or an air-conditioning system. This type of expense is likely to increase the value of the property as well as the rental return.

Ideally, a landlord should be aware of all types and make allowances for associated costs. It will help to minimise expensive repairs (number 1) by undertaking regular property maintenance (numbers 2-4) so problems don’t become big ones. Water damage is a common one that if not addressed promptly can become a very expensive repair.

Another benefit to keeping the property well maintained is the type of tenant it will attract. Prospective tenants viewing a neglected property are less likely to want to rent it. When a property is run down and uncared for it will attract the same type of treatment from a tenant.

One of the most common reasons tenants choose to move is due to landlords not maintaining the property.  So to attract a good tenant and keep them, make sure the property is well maintained.

If we manage your property please contact us to arrange annual servicing of items. Or call us for any information about the above – 9450 3398 Dorothy and Sean.


Tags: common problems, landlords, perth real estate, property maintenance, property management, rental property

Comments (0)


A Tenant’s Frustration

by ANREPS In Property Management

13 June 2016

Written by Sean Lowrey, ANREPS’ Property Manager

With the way the market is at the moment many Property Management departments are struggling to show all of the vacant properties because they don’t have the time and resources given the number of empty properties they have. I question the methodology that some offices are using.

For example I am currently looking for a new rental property for myself as the house we are living in at the moment is about to be knocked over. I am frustrated dealing with property managers and arranging times to visit houses. It seems many offices are more interested in arranging a time that suits their schedule and business hours rather than what suits a prospective tenant. A big focus in property management these days is using technology to save time and this technology is promoted to owners as of benefit to the owner but I would suggest the benefit is more for the property manager than the owner despite the fact that owners are provided with detailed reports of how the leasing process is going by this technology.

This isn't Sean but is possibly how frustrated he looked!

This isn’t Sean but is possibly how frustrated he looked!

Currently a typical scenario might be a property is advertised for lease and it is then up to the tenant to register their interest and depending on the property management policy there may or may not be a home open advertised. The tenant’s enquiry is automatically dealt with by a database. Some offices use a system whereby a home open time is not advertised until the tenant registers their interest. Therefore it is left to the tenant to make the first move, register their interest, receive acknowledgement of their interest, and then wait for the property manager to set a home open time once they have had several people register. Once a home open time is set the database sends out an automatic email to the registered interested parties inviting them to agree to attend. Often these home opens are set at a time in business hours for example Thursday at 1 PM that may not be particularly convenient for the prospective tenant.  I suggest by using this method property managers are compounding the problem of vacant properties and in doing so are not looking after the landlord’s interest or anybody’s interest.

At one property that I have had an interest in viewing, I registered my interest, waited four days for a response only to receive an invitation for a viewing during business hours at an inconvenient time. It was then up to me to click on a link to register that this time was not suitable, to which the database replied that I would be contacted when another home open date had been set which I guess would have again been at a time during business hours convenient for the property manager. No contact with a human and no effort on the part of the property manager to find out what time was convenient for me.

So the moral of the story is whilst technology can be a valuable tool, what really counts is having people available to show properties at a time convenient to prospective tenants such as after hours on weekdays and weekends. And to also have home opens clearly advertised and set in order to make it easy for tenants to attend without necessarily having to register and/or attend on impulse.

For example we recently had a unit coming up for vacancy within a block of 30 other units with six units being advertised at the same time with six signboards at the front of the complex. We advertised our property with a home open on a Saturday morning, tenants were not required to register and on the first Saturday only one person attended the home open. None of the other six units had home opens advertised for that day. The one person that attended required urgent accommodation and signed a lease in a matter of days at a price greater than the asking price and at a higher price than any of the other units advertised. (The tenant offered a higher price because he was only looking for a six month lease and the owner preferred a 12 month lease and the extra amount was offered as  compensation). Therefore our unit was leased well before any of the other units despite them having been on the market for several weeks beforehand and remained vacant for several weeks after.


Tags: landlord, perth real estate, perth rentals, property management, renting, technology

Comments (1)


      
« Prev  1 2 3 4  Next »