PM organised maintenance services without my approval

PM forwarded me couple tenant' s requests every month. For 3 month rent, I only received rent of $260 after deducting management fee and maintenance cost. PM organised the following services, some without my approval and acceptance of the cost/quotes.

1. Fuse Replacement - Power Box: $203 (without provide any quotes prior to organising the job)
2. Annual Smoke Alarm Service Fee & Compliance Test: $99
3 Bond Clean (Mama Scrubs): $176
4.Carpet Cleaning $294 (without provide any quotes prior to organising the job. What the prices? - I have cleaned 4 bed rooms of this property for only $90 before)
5.Leak - Kitchen Sink : $190
6. Hedge trimming: $340 (without provide any quotes prior to organising the job)
7. Requested extra cloth hanging pole (I have replied that tenants have inspected the property before signing the contract and should accept the property as it is. They can buy cloth hanging stand from Bunning if they want)

What can I do with this PM/tenants?

 

First read your management contract and see if you have given the agent the power to enter contracts on your behalf.

 

It sounds that the Maintenance Service Department of my PM uses this term of management contract to make money for their department. So, they have encouraged tenants make a lot of maintenance requests.

 

What term are you referring to?

 

Maybe in your management agreement you agreed (unintentionally) for them to be able to spend up to a certain amount on maintenance per event without consultation. Most of mine have between $300-$1000 in them. I always cross them out and either put $200 or $0 depending on how well I know the property manager. I don't want them doing unneccesary maintenance without prior approval, or making improvements for the tenants without my ok.

 

Hi Terry
The term below:

"Repair and maintenance: the maximum value of repairs and maintenance ti be paid by the agent without prior approval by the client: 2 week rent - agent will act in best interests of client"

However, what agent acted may not be in best interests of client???

 

How much did you allow in your management agreement?
I allow up to 1 week rent nowadays but have always note that I would need to be notified as soon as possible.

2 weeks??!
I'd go to your agent and told them no more maintenance allowed without your prior approval.

 

Can I resign the management contract? or just ask them to stop doing this by email?

 

You should be able to just send them an email to say that they now need your verbal/written approval prior to any non-urgent work being undertaken on the property (you can't legally stop them getting urgent repairs fixed). Just make sure to cover yourself you put on a read and delivery receipt and ask that they reply to the email to acknowledge the new terms.

 

Fairly sure (In VIC anyways) tenants need to have the carpet steam cleaned prior to vacating. If you needed to do a bond clean I'd be asking why the property wasn't left clean and looking to claim this from the bond.

All my management contracts allow for urgent repairs only, and even then I've asked to be notified first.

 

It is in your interest to have the fuse repaird, carpet cleaned etc.

It is unclear from this clause if they could contract multiple times as long as each doesn't exceed 2 weeks rent.

You can ask them not to organise anything without letting you know - but you have agreed that they can.

 

Uh this is a pretty big call - why do you suspect this to be happening?

If I found out this was all happening, my first reaction would be "oh good the PM is doing their job" rather than "oh the PM must be screwing me over".

 

I don't want more work! Maintenance is the absolute worst to deal with, I want less!

Sounds like PM is working by their management authority, personally unless a client has told me specifically to not contact them unless the price to repair is over X amount I will always contact them. In any case, you need to contact the PM in writing and advise no maintenance is to be authorised without your consent.

I would also question the cleaning and carpets, that should've been taken from the old tenants bond. Will they be reimbursing this?

On that note as well, can no longer claim carpet cleaning as standard at VCAT. Unless you can prove the carpets are stained or damaged, VCAT will no longer award

 

Their organisation has two separate departments: Maintenance Service Department and PM Department. Maintenance Service Department looks after maintenance services. It seems that this department increases their works/activities by creating a lot of small maintenance jobs. It is the interest of Maintenance Service Department, not PM.

 

Its still a big stretch. Its also in your interest to get maintenance done, with a minimal of hassle to you.

Anyway, you're the one that picked the PM agency and signed their authority to contract maintenance works below a certain amount. If you don't trust them now, then move to ditch them.

 

definitely need to change your PM and/or contract situation. 2 weeks rent... bloody hell. My PM always emails me to let me know if something small needs doing as a courtesy and asks what we should do with bigger things.

 

We always limited it to $200 without consultation.
Legally defined emergency conditions excepted, of course.

Two weeks rent will be $500-$800 or more. A lazy PM happy to tick and flick, combined with a demanding tenant would be a nightmare.
Marg

 

I agree but not at any price. If the going rate for carpet cleaning is $100, paying $300 for the same service is too much for convenience IMO.

 

I struggle to believe this. No PM "wants to organise maintenance" but the good ones stay on top of tenant requests brokered via the landlord. One of the biggest problems we see when we take over property management files is a string of maintenance requests that either haven't been attended to after landlord consent, or even worse, a string of maintenance requests that weren't even passed on to the landlord! We then do our job and pass them on or get them actioned and the landlord is usually furious they weren't informed of what was going on by their previous PM.

A good PM will help you to stay on top of maintenance to uphold the rental and asset value of your investment. Remember, the PM has a duty to report maintenance to you and it's your decision as the landlord whether you action it or not. There is guidance as to what you must action but the overriding principle is that the property must be kept in a good condition and fit for the tenant to live in. Of course, this is quite broad and why disputes happen when landlords refuse certain maintenance. See here for further information.

All in all, it's a combination of your tenant, your PM and yourself. I have seen "bad" versions of all three - tenants trying to enforce ridiculous requests, PMs not doing their job and landlord not understanding their responsibilities or the legislation. In my opinion, there is a stark difference between a landlord and an investor and one of the criteria is how each approaches maintenance. A landlord sees it as a burden and constantly resists it, blaming the tenant and their PM. An investor accepts that it's the cost of doing business and is grateful their PM is passing on requests and actioning them, realising that it's part of upholding their property's value. Of course, I'm not saying one should welcome maintenance requests! However, they're inevitable and it's how they're perceived and dealt with that determine part of the success of your investment and how comfortable you will be holding the property ongoing.

It will be a rare case that a PM is making money from their tradies. Our job is to minimise cost and maximise overall return for the investor/landlord. I don't even believe it's legal unless it's written as a fee into the Form 6 as this would be a revenue generating activity.

 

I think it's sometimes hard for professionals who actually do the right thing to forget there are some truly shocking property managers out there. You may have missed an earlier thread where someone complained that unnecessary maintenance had been undertaken on his IP. People told him not to worry, the PM was acting in his best interests etc etc. The poster was not happy with the response and took the matter further. Turns out the PM was doing the wrong thing and was reported and investigated. It happens.

We have not been provided any evidence in this case that the PM has done the wrong thing but I consider some of the claims made by the PM highly suspect. Carpet cleaning and hedge trimming in particular would have been questioned by me if that was my PM