TAS End of fixed-term lease question

Discussion in 'Property Management' started by TazCaz, 17th Dec, 2018.

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  1. TazCaz

    TazCaz Well-Known Member

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    Hi there,

    My tenant is 17 days away from the end of the first year of their fixed-term lease. In September, my agent asked of my intentions and suggested a slight rent increase if the tenant was to renew. I agreed and this was communicated to the tenant. It took many weeks to hear back, but the tenant finally responded and said they would be reluctant to renew if the rent was increased. They are a good tenant so I agreed that I wouldn't raise the rent so long as they renewed for another 12 months. That was about three weeks ago. I was told when they were given the lease to sign in September that they had to return it within 14 days. It's now been 10 weeks. My agent is struggling to get hold of the tenant and the lease is due to expire in 17 days.

    I genuinely don't think this tenant will cause any trouble, but I do believe they are being purposefully elusive in terms of potentially looking at other properties. My agent has now advised that if I don't hear from the tenant, I can either issue a notice to vacate, which would give them 42 days to vacate, or it goes onto a rolling, month-by-month contract. Given I wanted them to sign another 12 month lease, neither option is ideal.

    I have been trying to search, but can't find much information about notice periods for tenants coming to the end of a fixed term lease in Tasmania. Am I right to think they need to give 14 days notice before the lease expires (ie three days from now if the lease expires in 17 days)? How much notice would they have to give on a rolling, month-by-month lease?

    is there anything else I should know in terms of my rights and the fact i might be facing an empty property while a new tenant is found, given it's taken 10 weeks to hear back from the tenant about their intentions after being issued with a new lease?

    Thanks in advance for any advice - this is my first 12 months as a landlord as well!
     
    Michael Mitchell likes this.
  2. Propertunity

    Propertunity Exclusive Real Estate Buyers Agent Business Member

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    Just to add, some (not all) LL insurance companies will not cover you for loss of rent if your tenant is not on lease ie periodic or month to month.
     
  3. bunkai

    bunkai Well-Known Member

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    Why does the tenant need to respond? You and they have a valid lease that continues past the end of the fixed term. You can issue a rent increase inline with the terms of the agreement.
     
  4. Michael Mitchell

    Michael Mitchell Well-Known Member

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    The above is why fixed term leases are preferred over periodical.
     
  5. TazCaz

    TazCaz Well-Known Member

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    Admittedly this is my first year of being a landlord, but for the 20 years prior as tenant, I would never have simply ignored multiple correspondences from the agency asking me to resign a lease - especially if I'd negotiated the rent to stay the same for another 12 months. Though I wasn't previously aware - as pointed out above - some insurance companies don't allow for periodic/month-to-month leases, not to mention the added security of having a 12 month lease in place. Besides that - it was the condition of me keeping the rent the same - it just seems odd that the tenant isn't getting back to me and the agency doesn't seem to be chasing too hard.
     
  6. TazCaz

    TazCaz Well-Known Member

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    Oh wow - I didn't know this. Will have to look into my insurance just to check (I'm with Terri Scheer if you happen to know?)
     
  7. TazCaz

    TazCaz Well-Known Member

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    Thanks Michael - what would you say are my options are going forward? I know I can give her notice to vacate (42 days) but I would much prefer her to stay as she's a good tenant. I've asked my agent what would happen next but they aren't replying either (I really am very frustrated with them). We're now at 16 days before the lease expires and I don't want to go onto a month-by-month lease.
     
  8. Michael Mitchell

    Michael Mitchell Well-Known Member

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    If you don't want them on a periodical, no choice but to issue a notice to leave or sign the new fixed term type ultimatum. It sucks but it's your property not theirs and if they won't abide by your wishes, they need to go (buy their own house lol).
     
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  9. Dean Collins

    Dean Collins Well-Known Member

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    You need to be on top of the PM. It sounds like you are a lazy investor expecting the agent to do everything for you (yes they should.....but in my experience-they don't).

    Our IP's are in NSW so not sure how this works in Tasmania but here is the schedule that I put into my calendar in advance every time a new annual lease is signed.



    t- 70 days….contact agent, gives us 7 days to decide on new rent rate
    t- 63 days…..serve notice with tenant request to renew lease 30 days to decide
    t- 33 days….If the tenant doesn’t renew before 33rd day give “30 days notice” ending fixed term asking them to leave.

    Show property 28/21/14 days out (on Saturdays) so new lease can be secured for T+1 (though we generally do T+2 to allow a day for repairs etc).

    If tenant renews……new lease kicks in with increased rent on the first day of new annual lease - we NEVER let tenants go month to month.

    You need to know the laws, and be on top of property managers who might have 100+ properties to manage.
     
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  10. TazCaz

    TazCaz Well-Known Member

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    Haha ok - you don't really know me, my situation, or the work I have put in to managing my property, so that's a bit of an immature statement. I'm very involved in my property and am generally doing most of the leg work myself, however, I am currently overseas so in this case, I'm relying on my PM to actually do the job they've been employed to do.

    I'm glad your schedule works for you. I have been working on a similar timescale. Rather than simply "asking them to leave", I'm actually hoping not to lose my tenant as she's a good one. Though the tenant is being a bit elusive in this case, my issue is with my PM (which I don't actually have right now as she left two months ago and the agency still hasn't assigned me a new one). I am currently investigating moving agencies too.

    I don't think it's "lazy" to expect that a PM follows up on requests to have a lease signed or does an inspection when they are supposed to given that is exactly what I am paying them to do.
     
    Last edited: 19th Dec, 2018
  11. Zepth

    Zepth Well-Known Member

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    Can you specify which ones? Only policies I have ever seen stated a lease agreement needed to be in place. Periodic tenancies are still under a lease agreement
     
  12. Dean Collins

    Dean Collins Well-Known Member

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    lol....not disagreeing with you - just pointing it out that we have significant amounts of money tied up in these investments......as such its up to us as LL's to make sure things happen as they are supposed to.
     
  13. Propertunity

    Propertunity Exclusive Real Estate Buyers Agent Business Member

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    Without doing too much research, the 2nd LL insurer's PDS I read online (from Suncorp) states they will only cover 2 weeks on periodic lease compared with 14 weeks otherwise:
    upload_2018-12-19_10-44-21.png
     
  14. Scott No Mates

    Scott No Mates Well-Known Member

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    @Propertunity - what is the definition of " written rental agreement" and "periodic rental agreement" - are they referring to a different type of agreement which did not have a fixed term or a fixed term lease which is on holdover under the terms of the lease? Is it the insurer's wriggle room?