Landlord vs property manager in Perth WA

Just wondering if anyone has had to make a complaint against the property manager mismanaging your property and what the process is in Western Australia?

Long story short, 3 pm's (in one agency) advised to let a tenant go. I live interstate so stupidly trusted their assessment of the local rental market. Fast forward 4 months and $8k in lost rent later, still no tenant, and yes we dropped the rent several times, far below what the original tenant was willing to pay.

I've blasted them for this 2 months ago, and now intend making a formal written complaint. Where do I stand as far as recovering any of the rent loss they caused? Is this something that will have to go through SAT? Advice welcome.. thank you.

 

@thatbum probably knows the process

Sorry to hear it's been vacant for 4mths - that's a lot of ouch
Why did they advise to let the tenant go?

 

Lots of issues to consider here.

Do you just want to complain to their regulatory body, or get an actual remedy? They are entirely different and separate processes that don't have anything to do with each other.

But perhaps firstly, you need something valid to complain about. Its not clear that you have that from your brief post. Legally, if you're calling it "mismanagement" - then its probably either a breach of management contract, or negligence by them. That isn't necessarily easy to make out.

A PM advising you to let a tenant go might not have been the wrong thing to do necessarily. What was the story there?

 

What was the reason given for letting tenant go? This will be the crux of whether you have a case or not.

There are several legitimate reasons for moving a tenant on. The current rental market needs to be factored in here - the worst the the market is, potentially the more you put up with. Everything is a case by case basis once all the variables have been considered.

 

Oops sorry, should have mentioned - they said to let the tenant go because the tenant wanted a reduction in rent and they said it was too low. The tenant said they thought it was worth about $500/wk but was willing to pay $575/wk. All 3 property managers said $575 is too low. It's now on for $500 and will probably need to go lower.

 

I presume this was at the end of the previous tenancy when the old tenant was up for renewal?

Even with the PMs being wrong, it doesn't mean they were negligent necessarily. It depends a lot on what was said and what the best evidence was at the time about the rental value.

Did you or the PMs do any research on comparable rentals to work that side of things out?

Something around 500 or 575 a week is well above median rent and so I would have been super nervous about not keeping a current tenant on.

 

Yes this was when their lease was up (they were paying $625).

They told me they did a comparison and it's worth "definitely $580-600". But it was listed at $550 and kept dropping. When I pointed out the tenant had a better idea of the value than 3 pm's put together they said my property is "unique" and the market fell - in the space of less than 4 weeks? At a time that the rental market is supposed to have stabilised?

Anyway despite the advice to let them go I was willing to accept the lower rent. I asked them to go back to the tenant with a "half way" proposition to see what they would say.

Two weeks later they're emailing me asking what I want to do as though they didn't see my previous instruction. I point them to my email from two weeks ago.

Another week later they say they haven't heard from the tenant and will follow up.

Another week later they tell me the tenant only wants to extend for 1 month. So basically they didn't follow up with the tenant in time (if at all?) and the tenant decided to move. I don't know if the tenant ever received the "half way" offer at all.

 

Nothing in those details point towards any clear negligence to me. If anything, the finer details there hint that things that might go the other way.

For example, having a "unique" property just means valuing it is a lot more difficult. And did you see the comparisons they were talking about? Did you do any of your own searches for comparable rentals?

I'm not trying to blame you either, but I'm trying to point out that if you're wanting to play the blame game, you need to have answers for why its definitely their fault.

 

I definitely should not have relied on them, you are right in that. The property is not *that* unique, it's a freestanding townhouse. There wasn't much to compare it to so it was difficult for me to evaluate it especially as I'm busy with 7 other properties, a business, family and I haven't lived there in years. However I pay the agent to be on top of their game and they definitely should know the values, certainly better than a tenant.

I don't second guess my mechanic, travel agent, doctor, lawyer as it's not my area of expertise... why is this different? Are property managers exempt from competence requirements?

I'm not trying to be facetious, I just don't understand why it seems to be the only profession where I'm expected to know more than they do....

 

And to pay a premium for it too.

 

Exactly. I know it's my property, but what am I paying them for?

I also have a body - arguably much more important than a property If I follow a doctor's bad advice and something happens, it's on them. But if follow a property manager's bad advice and something happens... it's on me?

 

As far as I have seen, yes they are. While there are some fantastic property managers around there are also a group that are incompetent bordering on negligent or just plain criminal. Is it because PM is essentially unregulated, as opposed to medicine and law which ate heavily regulated? Still, be glad it's just a bit of money. When Doctors stuff up, people die.

 

I empathize but can’t sympathize. It’s unfortunately more common than you realize and probably a good lesson learnt. I don’t believe you have any recourse and my post at the link below is probably relevant in this case also.

Help please - property manager not releasing files for handover


Having said that, although I cross check any pricing suggestions I can appreciate this isn’t everyone’s forte and is at the very least something your PM should be getting right. Sometimes the trend of a market needs to be taken into account as well as what is actually happening right now.

Good luck!