VIC Advising PM that I want to sell...

Hi,
I have a IP (house) in Melbourne that I plan to sell at the end of the current lease, which is 01/05/2020. I want to throw this out there;

If I advise the PM of my intention to sell now, is that too early?

Has anyone had an unintended consequence as a result of telling the PM so early?

On the other hand, has anyone had a good result?

Interested in anyone's thoughts on this.

Grant

 

As a property manager, I'd prefer to know if one of the landlords was thinking of selling. Doesn't matter that its early - Can obviously confirm closer to lease renewal date if that's still the case or not.

In the meantime, if big repairs are needed they can be handled in that context - eg there's sometimes scenarios where you might do a cheap fix vs a proper fix if you're planning to sell it soon. Also means we can be honest with the tenants if they ask us about your intentions.

The main draw back here is if the tenants break lease , then its going to be difficult to get break lease fees out of them, because there's a requirement for you to re-let to mitigate your losses.

 

I share an office with some property managers. We've discussed this (and many other) topics.

You'll get a much better result if you're upfront with the PM. There's plenty they can do to make the sale process a lot easier and will likely end in a better sale price.

 

I would avoid telling the PM too early of your intention to sell. They will also try and sign you up to someone in their sales team but don't feel obligated to sell through the same agency as the PM.

 

I can't think of any particular advantages in telling them this far out. A lot can happen in 10 months! Is there a particular reason you want or need to tell your PM at this stage?

- Luke

 

Just let your sales agent tell them

 

Hi, and thanks for your input.
There is no 'need' to tell the PM this far out and I agree, a lot can happen between now and then. Once my wife and I made our minds up (that we will sell) we felt it would be the right thing to do by the PM and by the tenants in the event the PM discloses this to them. Having said that I am cautious of showing my hand and putting undue pressure on ourselves if that was a possibility.
Grant

 

Thanks Michael.
Grant

 

HI,

Good point. Thanks!
Grant

 

Hi Peter,
Thanks for the advice.
What could the PM do that would assist getting a better sale price?
Grant

 

Thanks for your advice! Good points to consider.
Grant.

 

They can manage the tenant (and the landlord) to ensure that inspections go smoothly. They can organise cleaners to help the tenant get the property presentable, organise tradies, etc.

The other side is that the tenant actively resists the sale and makes the property difficult to sell. There's plenty that a hostile tenant can do to make the sale difficult and sabotage your result. Having a good PM on board will help you a lot.

 

I think 10 months is too far out. If the tenant is on a 12 month lease they probably just re-signed! Also, life changes in the blink of an eye. You may not want to sell in a few months as another poster mentioned.

FYI: You can use the quote function to put all your replies into the one message.

 

It is probably one of those scenarios where there is no right or wrong answer. If that makes you feel comfortable then let them know. Having said that, I don't think you are doing the "wrong" or unethical thing by not telling them. Certainly not a nice thing as a tenant when the first you hear of it is a sales agent turning up 2months from lease end to do an appraisal. Giving the tenant a heads up early next year is still plenty of notice.

- Luke

 

its amazing what some people will do when it comes to their living premises

I had one tenant who never said boo, tell all prospective buyers that the house was unliveable and a dump, and they shouldnt buy it, (even went to the extreme of painting a crack in the brickwork a bright red so everyone could see)

agent even told them about them not being on a lease and they could be evicted anytime and to behave , and that prospective buyers were all investors and would let you know,

that didnt stop hm, and his antics, and when I gave him notice to vacate, his reply was "why is he doing this to me"

 

I am in a similar predicament and want some advise please . I have long term tenants on a periodical .I plan to sell in a bout 12 months .The PM is not from the area .I am thinking of getting a local sales agent and not the current agency that manages my property..
If the tenants are on a periodical how much notice should I give. I understand it is 60 days currently in Victoria .
I read the draft legislation re the the up coming tenancy law changes from 7/2020 and the 60 day NTV if the landlord is selling has NOT changed ,only the 120 NTV is being abolished .. is this correct ?
second I plan to inform the PM prior to the 60 day NTV is to be issued, to avoid any hassles or misunderstanding with the current agent who most likely will expect me to engage them in the sale. . I prefer to sell the property vacant ,rather than have tenants who may sabotage or create issues for me .

 

First thing to do is to read your contract with your Property Manager. There may be a clause in there stating that you must use their company as the selling agent.

 

Correct, only changes to 120 day notice and 90 day end of lease.

Before you engage a sales agent you may want to get the PM to ask the tenant if they wish to buy, you’d still be paying commission to the PM for helping with the sale - but in most occasions it wouldn’t be as high (ie. no advertising etc)

In over 10 years in this industry I’ve never once heard that, is that common in other states? That seems absolutely ludicrous!

 

Be careful of letting the PM know, my brother had issues where the PM wasn't the selling agent, as they under-quoted ridiculously on the estimated market value, so the PM took the tenants out at first notice and moved them into another property so my brothers house remained vacant up until sale.

Where as when I engaged my PM (same REA) to sell my house as well (had to tell them to list the property for sale $30k more than they estimated) they had tenants in there up until 5 days before settlement.

I also got $25k more than the selling agent was adamantly quoted, and sold in 14days.

 

Surely thats not a real clause!

Thats pretty bad form