Joint Lease Agreement

Hi guys,

Just wondering what are the cons and pros of renting a property under joint lease agreement with my partner, rather than putting the lease solely under my name as single tenant (even though my partner stays in the property too).

 

If something goes wrong only one of you would be sued.

 

Wouldnt give you the option (all adults are going on the lease)

 

Pro's- Easier to get a property, both of you will have rental history, extra income considered, etc. etc.

Con's- It's a little bit harder to have the "I don't love you anymore, and you need to move out" conversation with your partner if they're a leaseholder with you.
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Best practice is that all adults MUST submit an application if the property will be their primary place of residence. In certain circumstances, adults can be considered approved occupants and not leaseholders, but that means their income cannot be considered towards serviceability AND their actions then become the remaining leaseholders responsibility.

 

You apply with all adults, otherwise, your dodgy, either cheating centrelink or housing scumbags.

You choose, do you want to be legit or not ?

 

My tenanted property is currently being tenanted without the lease as it ran out and I left it at that. The lease had two names on it and now my agent has contacted me to say that they want one of the names removed. I suspect The persons name who is being removed is the is the wage earner and they want a 10% reduction on the rent. Does anyone have any advice on what the possible implications of agreeing to this request. The agent says we are we are legally required to grant the request. But I have very uncomfortable feelings about the fact that they could be lining up their ducks for something else. Would appreciate some advice from some seasoned landlords. Many thanks

 

I've only ever had one person (usually me) on the lease irrespective of how many other people live there.
I figure if the other tenants cause any problems that's my fault/responsibility which is fine, and it makes it alot easier if someone moves out/in.
I would imagine your average PM would happier to have only one person that needed to be contacted for anything, and therefore only one reference check.

Owners might care who else is living in the property, but agents/PMs certainly dont.

I'm not sure what the benefit to yourselves would be having both of you on the lease, but if it makes you feel better go for it I guess

 

It sounds like they are on a periodic lease and looking for a 10% reduction.
I'm not sure what it is you think they are lining up exaclty, but as a tenant I usually wait for the fixed term to expire before asking for a reduction.
As the landlord you either agree (and I'll often re-sign another fixed term) or you dont, and I pay the original rent on a periodic lease which I usually then terminate once I find something else.

All I can guess is that they are considering leaving unless you meet the reduction request. I wouldn't be worried by one persons name being removed however.

 

@TB0023 The agent should be checking to see if the remaining tenant can service the rent on their own. If not, then you can consider giving them notice. It's a bit rich of the agent to say "half the rent is leaving and there's nothing you can do". That's slack. The rent reduction is a separate issue and they need to follow the process in place for COVID affected tenants.

Also, @MB18 that couldn't be further from the truth. We want ALL adults on the lease wherever possible. Any which aren't leaseholders are at least approved occupants- which means they go through all the same reference checks. We often have one main point of contact, but much prefer being able to contact others if necessary as well.

 

I'm sure there would be exceptions, such as yourself.
My personal experience with every PM I've dealt with over the years has been the complete opposite, even to the point of 'I dont care who lives there, provided the rent is paid'.

I usually make an effort to revise the maximum number of tenants in a effort to appease the PM should I choose to sublet a room later, but I've never sought approval for a particular individual.
I cant think off the top of my head where in the lease the PM reserves the right vet anyone I sublet to provided maximum occupancy is adhered to either. (It might, I dont know).

Dont get me wrong I realize the potential for problems on my part, but it's a risk I've happily assumed for years now without incident.

 

hi again, I should clarify that the agent said legally they are entitled to have one person on the lease or something close to that effect. The they are also asking for a 10% reduction in rent I don’t believe this is Covid related but market market related. The agent tells me that the amount that they’re asking fir reflects the current market. The agent also said that they have a lot of stock on the market I did a preliminary check on the Internet for similar properties and I’m not I don’t really have a firm view yet

 

Hi Tom, yes the agent did say that she will be asking for evidence of being able to meet the rental payments. They have not declared any hardship due to Covid. The agent says that the amount being reduced is in line with the current market .
My view is that I should ask for a reason for asking for reduction in the rent.

with regard to the lease change to one person, they have said it is due to personal reasons. The agent said they are in titled to change the name on the lease to one person. The property is least in New South Wales.

if the person whose name is on the lease, and who we know is not working (not due to covid) cannot service the rent what fullback do I have in the current climate?
Doesn’t make sense to me that the wage earners name is not on the lease am I entitled to ask the wage earners name be on the lease instead of the non-wage earners name?

 

Thank you

 

If it's in line with the market, and they're good tenants, and there's plenty of stock out there, I'd be inclined to offer a reduced rate of say 5%. If not, consider the 10%. You save on fees finding new tenants, plus lost rent, and they save on moving costs.

 

yes - the is reasonable. The change to 1 person on the lease worries me mor though

 

Wait, one of the names is being removed but that party will still be residing at the property? Why?

You cant have no income on the lease. If things go wrong and you have to take it further, you'll be laughed at by the insurance company, or NCAT.

The remaining leaseholder needs to substantiate that he or she can service the rent, and if they cant, you need to make a decision as to whether they stay or not.

 

Hi Tom thank you for your continued detailed responses.

This is the issue that is concerning me the most. Even after checking the serviceability on the lease via banking details, they could quite easily ,be moving funds back into the partner’s account (not married- not sure if that would make a difference). I should say that they have been good tennants. Have small child.

If you were in their shoes, and in the current climate, only 1 person working, why would you want to remove one of the names on the lease and only leave the person who is not working?

You have just alerted me to also checking with my insurance co on this.

 

Be interested to hear what your insurance co. has to say and how they deal with it.
I signed my last lease with zero income as I was not working (pre-jobkeeper) and the PM had some questions about it but was otherwise fine.

I rent as a lifestyle choice and dont intend working until normal retirement age. Surely there are other people out there who dont nesscararily need a job/regular income to pay rent and therefore secure a lease? Immigrants with financial interests offshore would be a common group too I would have thought.

 

Did you substantiate your capacity to service the rent at all?