Possible bad tenant red flag/

Have an investment in paramatta region,

Lease was signed last year and has since lapsed today, i have discussed with the tenants (through the managing agent) for renewal given requirement for my rental default insurance to have a signed tenancy agreement.

Issue is the tenant has been avoiding the agents calls and messages and seems 'distant' the one time she got ahold of her (agents words)

They are paid a fortnight in advance and have no had any previous arrears issues and historically have had no issues with rent (long term renters with this agency)

My query is, is this a red flag? And if they choose to stop paying and it causes an arrears event what are my options with eviction, the lease has expired - but considering COVID.

Thanks all.

 

Wow! The bar has changed since I paid rent.

A red flag was late with rent or place untidy. Being distant is not a crime.

I think they might be feeling cornered or harassed. Why would they care about insurance requirements.

I would try a much more gentle approach, or maybe an incentive to sign up.

 

So what’s the issue? That the tenants haven’t answered the calls and messages and seemed distant once?

 

Instead of being passive how about u comprehend the paragraph, Never said there is an issue, i said is this a red flag given the clear attempt to ghost the agent.

I have enticed with no break lease fee if they sign a lease and choose to break it with 1 month notice regardless of when they choose to leave within the lease.

 

Yes that seems quite fair.

Maybe life is hard ATM and they need breathing space?

Be kind .. Ur tenants are Ur customers!! Are they in lockdown?

 

How is it a red flag ? Why bother annoying them to sign another lease if it is the same as the periodic lease they appear to be on now?

 

Yeah I think that's a pretty paranoid interpretation. If I got told that by my agent, honestly I would probably guess that the most likely thing is that my agents hadn't tried very hard to get in contact with the tenant - and then I would just pick up the phone myself and contact the tenant.

Rather than sitting there worrying whether some comment from my agent was possibly a "red flag" and then posting about it online.

 

I was thinking same thing. Making excuses.

 

The first issue your property manager probably should have explained is that the expiry of a fixed period doesn't mean you no longer have a signed tenancy agreement. You automatically move to a periodic tenancy, so you still have a valid tenancy agreement in place.

If the tenant is paying rent in advance and no issues from routine inspections, then its generally no cause for concern. If they don't want to sign a new fixed period, in the current circumstances I would let them stay on periodic and try to communicate in a couple months.

If the tenant was to start accruing arrears, your PM would need to identify if they were 'covid-impacted', otherwise standard termination processes remain the same.

 

Accusing tenants of harbouring ghosts, while interesting, might not be true.

Can u sub lease to a ghost anyway?

Or is it resident in the house? Better check the inspection report.

 

It’s not the tenant that’s the the issue. The agent isn’t managing quite to the standard of how you want the property should be managed. Sounds like they dropped the ball.

 

Which insurer is that one?

 

Suncorp.

 

You're right, I should have mentioned there are insurers who have a preference for fixed tenancies so check your PDS carefully. We work a lot with Terri Scheer and EBM and neither have this issue.

 

Doesn’t seem like a red flag to me.

 

It sounds like the tenants are now on a periodic lease and happy with that.

If they have been problem free tenants who pay on time anyway is it worth getting too worried about the extra 12 weeks rental cover you could miss out on?

Sure, you could terminate their perdiodic lease and roll the dice on new tenants only to find yourself in the same situation twelve months later, or worse.

I would apply the risk x probability rule to your situation and either leave it as is, or change insurance company.
Hopefully you never have to find out what a bad tenant actually is.

 

If you dont want periodic lease, then this should have been made clear to the pm.