Advice when dealing with Agent.

HI all. A little advice or thoughts if that is OK.

I have two apartment's rented out in a relatively new building. I bought these apartments off the plan approx 5 1/2 years ago and they are managed by on site management which is a little expensive, but its simple and convenient so its not ever bothered me. One of these apartments has been tenanted by the same woman since I bought it, she always simply signed a new 12 month lease every year and she's been the perfect tenant. To cut a long story short.....In April the agent informed me that she had to break her lease due to having had her work drastically cut. (She is in the aviation industry) and not wanting to take advantage of the protections available under covid-19 as she was under the opinion that this would leave her with a large liability once things returned to normal. The lease had 9 months to run. The protections in QLD meant that there was no break lease fee and she fulfilled all the requirements as to cleaning etc and her bond was returned to her as required. The apartment has been vacant since.

What I was unaware of was that the tenant had actually written to the agent requesting a reduction of 200 dollars a week in the rent which she said she could afford. (Full disclosure, she was looking for a rent reduction for the next 3 months at which point she would look at her situation again and her options. She was not looking to accrue the $200 reduction to be repaid at a later date) This request was not passed onto me. Instead the agent requested that the tenant supply a statement of her income and expenses, asked questions as to whether she was entitled to social security and if she had applied, and similarly asked if she had investigated drawing on her super under hardship provisions. (I was unaware of this request from the agent) Having been there for 5 years, the tenant felt this unjustified, and unfair and in writing informed the agent that her offer was withdrawn, and she would instead be breaking the lease (accompanied by the required form)

So... My question is... does any one agree with me in my thinking that I should have been informed of the original request from the tenant, that the agent acted improperly, and that I am possibly entitled to damages, in effect my thoughts are that the agent acted unprofessionally and has caused me real financial harm. I am starting to have concerns re the second apartment which the lease has expired on but automatically extended to Sept as per covid-19 legislation. . The agent seems to feel they have the right to make these decisions on my behalf and I am wondering what options I have.

 

Thats' my point, I should have the right of acceptance / refusal...Not the agent.....It was the agents behavior who tipped the tenant over the edge so to speak and she went and rented elsewhere, (after five years...I came to think of her as an asset i would have tried to keep happy)..The rent was $620.

 

Sure...I have read the same but i think there is probably a difference between "Have you drawn on your super" and "You should draw on your super"
Its not really the crux of my question though.

 

One can hope but realistically, probably not

 

A new tenant has just been found at $565 per week..... I would love to find another agent. The building has a high number of rentals all with the onsite manager, the couple that have been rented through external agents have had issues with access etc as the onsite manager makes this difficult, It gets really complicated.

 

It sounds like the agent may have just been following what they believed to be due process. Once the tenants falls 8 days in arrears, they are REQUIRED to provide us with evidence of their financial situation in order to request consideration. It sounds like your tenant was proactive and hadn't fallen in arrears first, but the agent still followed the 'process'. It does make sense to ask for substantiation first, so that they can come back to you first.

How would you feel if a tenant asked for a huge reduction in rent without being willing to provide any proof?

The other issue is that your property has remained vacant since then, that's not okay. Has your agent discussed necessary changes? The rental market isn't doing that badly.

 

Correct, at no point was the tenant in arrears, she was being proactive.

"How would you feel if a tenant asked for a huge reduction in rent without being willing to provide any proof?"

The way i see it the tenant was seeking to vary the terms of her lease and the request should have been accepted / denied by me. If I wish to reduce the rent by whatever amount, thats MY call. The agent does not have the right to make these decisions on my behalf. It was the tone of the agents reply that got the tenants "back up". Some information requested was not appropriate and the tenant deserved, as a five year tenant without a single issue, to be dealt with respectfully and fairly.

 

I was pointing out that it doesn't sound like the agent blatantly refused the tenants request without your permission, rather she sought substantiation before bringing you the request. In that process the negotiations came apart and the request was withdrawn.

It sounds like the problem is the way that the agent went about questioning her. In trusting your judgement that the tone and line of questioning was inappropriate, that's what you should focus on. It's especially relevant since the agent has not been able to back up their actions with a replacement tenant, causing you a financial loss that was potentially avoidable.

 

Interesting situation and I cant say for sure what is fair. I think you are the only person who can judge this.
How has the Onsite Manger OSM behave all this while in other areas? Do you trust them and their judgement? $200 sounds like nearly 50% and 9-months is a long time.....
In our case, we are lucky to only have 3 requests for rent reduction. It turns out 2 of them are duped.... Tenants just asked "in case we miss out" an unable to prove that their income has reduced, and didnt pursue. One of them we didnt pass on to the Owners.
(Similarly for repairs. Some have had some unreasonable maintenance/improvement requests and depending on the Owner/Tenant, there had been instances where we didnt even pass on the Owners. That's probably because we have intimate knowledge of both sides, an advantage for being onsite; we know who is telling the truth if not immediately, but very very soon.

One point to note is that Onsite Managers usually pay big money for the Management Rights, so it is in their best interest to ensure your Unit is rented all the time at good rates. There should not be any prejudice because each letting means mone to them. If your Unit is vacant for too long, the other Owners will notice it and the OSM should be smart enough to know this is not good decision.

In summary, I think it'd be good for you to have a chat with the OSM if you havent done so yet. Understand how they do things and most of all, let them know your expectations.

If you like, happy for your to advise the suburb/other details of your property. I am sure others can chip-in as regards the rentablity.
All the best!

 

I think you are right in your concern. The tenant had a request which you were not even consulted on and the manager essentially decided that having the lease terminate was your preferred option - which is sounds like it wasn't.

Ive been in similar situations as a tenant where I suspect the property manager was rather selective on the information passed to owners, and I know for a fact landlord friends have had info withheld from thier tenants for what I can only assume as incompetence, arrogance, or laziness on the managers part.

I'm not sure you would get anywhere with compensation from the existing manager as they like a complete idiot based on what you have said. I would give the manager the boot and roll the dice with another one.

 

@CDC I think you are in the right, assuming you havent left any relevant info out of your post, the agent should have give you a "We have an unusual issue, what do you think we should do?" call, so you could decide if you want to drop the rent or not, which is always the landlord's decision.

If the agent has been reasonable in the past, then maybe they deserve the benefit of the doubt, and a meeting about an amicable resolution would be in order.

Alternatively, if they are just mediocre, then you are paying too much, and they should get the boot.

And, maybe you should see if you can get in contact with the tenant, given their history, and see iuf you can entice them back.