Stop & Regroup

Today’s blog comes off the back of an interesting month. In recent weeks I have been reminded, by the new clients we have worked with as well as through a few scenarios in my own office, about the juggle that is the income producing Director. Perhaps you may agree, and I know it comes in waves, but right now it feels for many that there is an increased pressure for time. There is an increased pull in many directions of where time is required, and the challenge of prioritising where you can allow it to be used, or you may say consumed.

As an income producing Director there is a never ending juggle between working on the business and working in it and I am often asked what the magic formula is.

Whilst there are of course many different suggested percentages in a myriad of business books by business legends, from this mere Business Consultant, I think the answer is up there in the cloud, right next to the magic number of properties a property manager can manage. In short I don’t think there is a magic anything, there is a, what works for you.

Each person’s driver for having their business, their vision, and their weekly / monthly / yearly expectations are dramatically different, even for the super offices with which we work. Every Director has a different set of personal responsibilities and desires, from their significant other, kids, friends, family and other life responsibilities. It’s about identifying what your own personal goal and balance is and working towards that!

I heard Ita Buttrose speak at a conference and these words resonated, “you can have it all, just not at the same time”.   

Right now I am giving myself an advice boomerang, Stop and regroup. Right at that moment in time when you feel like you cannot afford to stop, is quite often the time when you need to do it the most. Get to that third space where you can clam your mind, think and review your plan.

If you are like me, running hard at life in every area, you must do this every quarter to ensure you are keeping on track to keep the world in balance.  It’s easy to tell you what to do, how to do it, you can plan it out in high detail, but ultimately it needs to be done, and action is the most challenging part.

Right now… I am off to plan my pause button… it’s time to STOP and regroup. !

How Smooth is your Tribunal Process?

Attendance at Tribunal can be stressful to even the hardest property manager. It is important to ensure that you are well prepared, with as much information as possible so that you know what you are heading into whilst attempting to achieve the best possible outcome for your client.

A great quote from Alexander Graham Bell that rings true when looking at this process is “before anything else, preparation is the key to success”. So, how prepared are you when it comes to Tribunal and are you ready to tackle any challenge? 
Let’s look at a few key steps to preparedness.

Applying and Responding

• Always have landlord’s approval and determine  what their ideal outcome may be and pre agree under what conditions you may withdraw application
• Check that the Court has the jurisdiction for orders you are making and ensure you apply against correct individual/s or business. Carefully specify which orders you request and give factual reasons
• Always keep a copy of your application and prepare your documentation straight away

Termination Notices

• Make sure the notice was in writing and states the full address of the rented premises and the full names of all parties
• Ensure that the grounds & details of breaches are explained  and it is signed and dated by the Landlord or agent
• Refer to MAA & RTA for required information, check service dates and check the rent arrears

Preparing for the Hearing

• Prepare a chronology of events and write down all issues relating to the case
• Gather your evidence with updated copies of ledgers/status and any information and know what you want to say

• Have a checklist handy to help you organise your documents. The team at Real + have a great one on hand. Click here to find out more.

• Practice your case, remember practice makes perfect! If you need help don’t forget to refer to the fact sheets and online videos
• Prepare your hearing notes for the member before the hearing and take a calculator, phone, pen, pad
• Ensure your Landlord is on standby

Above all remain calm, be thorough with your information and if you are ever at all unsure about the person you are up against, take someone with you for backup and good luck!

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Heidi Walkinshaw
Business Manager, Real+

Struggling With Properties That Won’t Lease?

Many of my clients have current concerns with properties that just won’t lease. Deep down in our property manager psyche we know that if the property is in satisfactory condition and marketed correctly it usually comes down to the price. Generally most troublesome vacant properties, despite anything the landlord thinks is causing the extended vacancy, it really does just comes down to the price.

But more often than not, for some strange reason despite us being the ‘expert’, the owner won’t listen to us to reduce the price to meet the market and we are stuck in the middle of the stress of trying to find a tenant and nursing the frustrations of said Mr Landlord.

I have many tactics for getting these troublesome properties leased, and dialogue for getting the owner around, but today I wanted to comment on not the problem, but potentially the cause.

The more I delve, I see that the issue usually stems from well before it’s been on the market for weeks and weeks, right back to when the vacate notice is received, and even prior to that. The issue starts with failing to ensuring the owner has a realistic view of the current market value of their property.

If we know ahead of time that the rental value of a property is or has fallen, why aren’t we communicating this to our landlords ahead of time, or at least giving a realistic picture at re-lease and rent review? I know why we don’t want to, because it will take more time, but think about it, what if we did?

Unfortunately more often than not we fall into a trap at the re-lease.

Don’t feel bad, I’ll admit it, I’ve done it many a time. The vacancy notice comes in, we see that it’s currently rented for $500 a week, and without much hesitation, we advise the owner to re-list at the same price, sometimes more. Even sometimes when we know it isn’t likely to get that much, especially not anymore. Often leaving ourselves with a bigger problem down the line.

Have you fallen into this trap when re-leasing property?

Why do we so often do this? Perhaps because subconsciously even though we know what the market is doing, it’s easier for us than doing a complete market review, providing the owner with a realistic honest picture, and sometimes having the hard conversation that I’m sorry Mr Landlord, your property is worth LESS now than what it was 12 months ago. Queue onslaught of that being our fault too. Feel familiar?

I’m sure there are some of you out there correctly educating landlords on the rental market at the time of re-leasing but for the many of us that sometimes aren’t and are taking the easy road out, think about those properties that you now have vacant for lease. Think what if the owner had been advise about the reduced value of their property weeks or even months ago, and provided with solid financial advice on the benefits of pricing to meet the current market, not just to get what they were getting before.... would we still be in the same position?

I know there will be the one or two on your rent roll that just won’t listen. But I know that there are a majority of landlords just waiting to be more educated on the market and screaming for us to lead them through. The next vacate notice you receive, try to treat it as if it were a new business property and go through the same market review pricing exercise that you would at that stage, re-educate the landlord on current tenant demand, comparable properties, vacancy rates, days on market - and do what it takes to help them minimise their vacancy and truly maximise their return.

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Hermione Gardiner
Real+

Six Simple Questions you can ask Landlords who are Tempted to DIY

A word from our Partner:

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Tenancies that are self-managed by investors appear to go pear-shaped significantly more often than those managed by a professional – at least in our experience as insurers.

However, it can be tricky trying to persuade landlords that it is worth their while investing in professional management.

Here are a few questions which might help you to have a discussion with them:

• Could you bring yourself to chase rent from a family or person experiencing hard times and, if necessary, to evict them – even putting children out onto the street?
• Are you well informed about tenancy legislation, good at keeping records and confident in your ability to stand up in a tribunal and argue a case?
• Do you feel comfortable with a tenant having your phone number and being on call 24 hours a day even if you’re overseas or on holiday? Are you available to supervise trades people, at short notice, if required?
• How will you find out if tenants are who they claim to be and whether they have previously been evicted or have a poor rental history?
• Will your landlord insurer cover you if you self-manage – and, if so, will the premium rise as a result?
• How much will you save, after tax, by managing your property yourself? Once the potential stress is taken into account, is your time worth more, or better spent, on other priorities?

Asking the above questions will help investors to understand what it is a Property Manager can do for them and the benefits that go along with choosing professional management services versus self-management.

Sharon Fox-Slater
Executive General Manager
EBM Insurance Brokers' - RentCover division