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Obstructive tenants

Discussion in 'General Property Chat' started by Bran, 9th Feb, 2016.

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  1. Bran

    Bran Well-Known Member

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    I've got an IP on the market, with excellent tenants (to this point).

    But, they are now being obstructive with allowing photos - the only photos we have are old low res pics of the outside. We have arranged a photographer twice with their ok (and only for outside, bathroom and kitchen), only for the tenants to refuse access.

    They are also disallowing inspections and stating "we are getting nothing out of this".

    These are the same tenants who 1) want to stay, and 2) want the new agent to recommend them as tenants.

    The selling agent (who is conditioning the **** out of me) wants me to lower the rent a little each week as a reimbursement, and this is probably the best option although it grates me.

    The other option is to give ?2 months notice (lease is up in a couple of weeks, will be on periodic lease)

    I'm very tempted to make a big rental increase and re-sign them. If they walk, I get two weeks notice and an empty house, if they sign, then my losses are less by 1000/year.

    I told them well in advance that i was 'testing the market', and that I will seek a long settlement so they have plenty of notice, but I've lost good faith now.

    Thoughts?
     
  2. dabbler

    dabbler Well-Known Member

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    If it is a house in Bris & you know it will be popular, I would get them out, lot of people wont want your tenant or any tenant, although I am sure you know that.

    If it is elsewhere and only appealing to mainly investors, then do what you have to....otherwise they will make opens/inspections a pain too.

    PS When vacant, I take as many shots of a place as I can, so not in this position, I also ask selling agents if I can have any they have to re use, most say sure....
     
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  3. Biz

    Biz Well-Known Member

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    Chop the rent by $50-$100 a week until it goes unconditional.
     
  4. Xenia

    Xenia Adelaide Property Manager Business Member

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    I would not recommend a rental increase as it needs to be backed up with comparables and tribunals are very good at picking up spiteful intensions - may get overruled.

    Play ball - there are rules to follow.

    They have to allow inspections - send them a legal notice of entry.

    Photos - grey area as it includes their furniture. We've had this before where we took photos and photoshopped their furniture out. It's a compromise.

    @Jennifer Duke recently did a story on selling with tenants in properties, she interviewed myself and I'm sure other agents that have experience in selling tenanted properties. May be worth a read of the article when it's ready.

    Rather than reducing rent, we give tenants incentives for keeping a property presentable at open times.

    Bottom line is that tenants cannot deny access legally and there are legal ways around it and most importantly your agents negotiation skills will show on this exercise.
     
  5. Xenia

    Xenia Adelaide Property Manager Business Member

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    You cannot just get tenants out if there is a lease.
     
  6. wylie

    wylie Moderator Staff Member

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    We got a tenant on side once by offering the final four weeks' rent free. His circumstances had changed and he was happy to move to a smaller place. But it was our need for an empty house at settlement that was important to us. He was a lawyer and held the trump card. He could have made life difficult for us, but knowing he could move without penalty AND get his final four weeks rent-free was a good win/win for both of us.

    He kept the place presentable, allowed open houses.

    Bran, if your tenants want to stay on if it is sold to an investor, why not offer the same deal to them if they cooperate? (You could offer two weeks rather than four, whatever you think will work best.)

    If an investor buys from them, they have scored some free rent. If they have to move, they have scored some free rent and will soften the cost of moving.
     
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  7. wylie

    wylie Moderator Staff Member

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    You can if they agree to it ;). Get it in writing.
     
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  8. wylie

    wylie Moderator Staff Member

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    Some good points Xenia, but even if the tenant is given a notice, they don't have to play ball. We had an agent once (who knew EXACTLY what he was doing - we didn't list it with him), and he left dirty clothing on the floors, kitchen with dirty dishes everywhere for the open houses.

    Sure, he had to open the door and allow prospective purchasers through, but that is ALL he did.

    He shot himself in the foot through because we would NEVER deal with him now.

    So, sweeten the deal Bran. Make it a win/win.

    You might also swing their approval to use some photos using this method too.

    Or... can you use the photos off RPData from when you bought?
     
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  9. Bran

    Bran Well-Known Member

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    The lease expires in 2 weeks, but I understand that this will flick them onto a periodic lease where I still need to give 2 months notice (or one month if it sells). They only have to give 2 weeks.

    I'm a little hamstrung, as I won't sell for a pittance, so there is a motivation in keeping the tenants in place. The agent is painting doom and gloom for the place (Cairns), and I'm not sure I have the same view of Cairns' prospects.
     
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  10. Xenia

    Xenia Adelaide Property Manager Business Member

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    Yes any contract can be broken by mutual consent.

    Personally I would not just let tenants out of a lease, leases are too valuable. I would find legal routes to gain entry.
    It could take months to get it sold, why kill the cash flow in the mean time. I would not advise a client to do that.
     
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  11. Bran

    Bran Well-Known Member

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    I did some photos for the original rental advertisement, when we lived there. They were great photos, but for some reason they are all low res and/or lost now.
     
  12. wylie

    wylie Moderator Staff Member

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    Of course, you must weigh up what presents the best value to you as a vendor. That is why our win/win worked so well. We "lost" four weeks' rent, but gained a cooperative tenant. We sold for a very good price too.
     
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  13. Leo2413

    Leo2413 Well-Known Member Premium Member

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    I had same situation in Brisbane.


    Basically its illegal , they have to allow you to open for inspection if you give them some days’ notice ( I don’t know the exact laws of how many days). So we gave them like a few days notice, and they had no choice but to let people go in. I told my agent to document everything at the time. As @Xenia said send them a Legal Notice of Entry. If they don’t let you at all show the place, I would document everything meticulously and then sue the **** out of them for damages.
     
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  14. wylie

    wylie Moderator Staff Member

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    Why aggravate it though Leo? Sueing them is stressful and expensive when for much less, you can offer them a carrot?
     
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  15. BigKahuna

    BigKahuna Well-Known Member

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    The tenants have to allow you reasonable access. The re agent should be telling them this.

    Can you tell the agent to give the tenants notice that if the next time a photographer is booked and the tenant can't be there, you will use the spare key to enter? That may be illegal; I don't know. Xenia will know.

    Don't like the agent asking you to lower the rent to placate the tenants, but if it means that they'll cooperate it may be worth it.

    Here in the ACT you can't hike up the rent at your discretion. There's a formula to be applied, and it works out to a pittance of an increase.
     
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  16. MTR

    MTR Well-Known Member Premium Member

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    Had similar situation with recent sale in Sydney. We made tenants a sweet deal, reduced rent if house was kept clean for openings. Got a friend in Syd organise this and it worked out very well, sold property quickly.

    If you try to fight it you will be the person losing out, what is the point. Just do what it takes so you achieve best outcome. Just my opinion

    mtr
     
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  17. Leo2413

    Leo2413 Well-Known Member Premium Member

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    I used to have that attitude, and I still do mostly. But there are times that you have to stick up for yourself otherwise people will just try and take advantage of you if they perceive you to be weak. They will walk all over you. I am not one for confrontation, but I have found that there are times you just have to say enough is enough.

    Edit: I was under the impression that the lease was coming to an end, and the tenants weren't allowing access. If the lease is not coming to an end for quite some time, then i agree, I would have to start with the carrot dangling first.
     
    Last edited: 9th Feb, 2016
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  18. Bran

    Bran Well-Known Member

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    Lease is up very, very soon. I can't remember the date, but within 2-3 weeks
     
  19. Scott No Mates

    Scott No Mates Well-Known Member

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    You are able to give notice any time before the lease expires to terminate, in NSW this is 30 days during the fixed period whereas it will increase to 90 thereafter. Better out than in. :p
     
  20. dabbler

    dabbler Well-Known Member

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    Given your concern for keeping it rented, you have little option but to smile through gritted teeth and do what needs doing to have them onside.....maybe you can offer them free movie tickets on each open day, a case of beer ? flowers, chocolates, or good old $$$
     
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