How to manage unruly renters

They claim you don’t really know anyone until you live with them – and the same could be said for tenants. You won’t really know what they’re like until they move in.

Most landlords have had at least one bad experience with a tenant. From unpaid rent to party-goers, there are a number of ways renters can test a property owners’ purse strings and patience. But there are steps you can take to improve your chances of well-behaved tenants and protect your investment along the way.

Know your rights as a landlord and theirs as a tenant before you even advertise your rental. Laws can vary from State to State so make sure you are familiar with the legislation in your market and follow it to the letter.
NSW: www.fairtrading.nsw.gov.au/ftw/Tenants_and_home_owners.page
ACT: www.act.gov.au/browse/topics/land-building-and-housing/renting
QLD: www.rta.qld.gov.au
VIC: www.consumer.vic.gov.au/housing-and-accommodation
SA: www.sa.gov.au/topics/housing-property-and-land/housing/renting-and-letting
WA: www.commerce.wa.gov.au/consumer-protection/renting-home
NT: www.consumeraffairs.nt.gov.au/ForConsumers/ResidentialTenencies/Pages/default.aspx
TAS: www.consumer.tas.gov.au/renting
State authorities also usually provide standard agreements you can download. Make sure you and the tenant sign the agreement and take all necessary steps to ensure it’s legal.

Prevention is always better than cure and the same applies to tenants. Be rigorous when it comes to screening applicants, even during a slow rental market.

• Run both a background and credit check.
• Call all previous landlords for references.
• If possible, drive by their current residence.
• Verify income – ideally, monthly take-home pay should be at least three times that of their rent to ensure affordability.

Make sure you receive a bond upfront before handing over keys. One month’s rent is the usual deposit, which gives you some financial protection against tenants who cause damage or do a runner on their rent.

One of the easiest ways to improve the odds of receiving rent on time is to ask the tenant to set up a direct debit on their bank account. While not foolproof, it does make payment more convenient, which reduces the risk of delay.
Your rental agreement should also spell out clearly the repercussions for late rent. Some landlords adopt a big stick approach, allowing just one week’s grace before a vacate notice is slapped on the front door.
Check with your State tenancy authority about the warnings or penalties you can build legally into your rental agreement before issuing eviction notices or you may find the law siding with your tardy tenant despite their arrears.

Fair and reasonable tenants are more likely to pay rent on time if you, as landlord, respond to their needs quickly. If there’s a plumbing problem, for example, get onto it right away.
If you have a property manager, give them a discretionary amount to spend on repairs without your approval – up to $300 for example – so minor emergencies can be dealt with quickly.

While it’s your property, you need to remember it’s legally your tenants’ home – and they’re entitled to privacy, along with your abidance with the law.
Providing it’s built into the rental agreement and sufficient notice is given to comply with legislation, you can inspect the property as often as you like. Twice a year, however, is the general rule. If your property is new or recently renovated, you might bump that up to three inspections a year to ensure everything is in order.
You also need to be clear what’s your responsibility and what’s not. For example, is the tenant meant to maintain the garden or pool? You also need to be aware what is considered normal wear and tear, which is the owner’s realm, versus damage caused by tenants.

Make sure you take out specific landlord’s cover on the building and contents. If your rental is an apartment, check with the body corporate where its responsibility ends and yours begins. Generally, the body corporate will cover the structure of the apartment (walls, doors, windows and ceiling) while the unit owner is responsible for everything from the wall paint in.
Landlord’s insurance covers claims that a regular home policy won’t, such as malicious damage by tenants and unpaid rent.
If a tenant skips out on rent and leaves a trail of destruction behind, landlord’s insurance could be your best opportunity to recoup some, if not all, of the losses.

If you don’t like confrontation or have no time, consider getting a property manager. For a reasonable fee, a good manager will advertise your rental in line with the current market rate, screen applicants, organise inspections, collect rent, take all tenant calls and complaints and organise repairs.
If you choose to self-manage, be prepared for calls any time of the day or night and to organise repairs even if it’s not convenient.

Keep records of all tenant communications and evidence (such as photos) of any breaches of the rental agreement. The more your records are in order, the better your chances of winning any claims for damages or loss of rent.