Not happy with current rental agent- What are my rights?

knowwhat on 26/08/2019 - 21:16

Hello Ozbargainers,

Hoping to get some answers or tips on my situation.

So the long story short, I chose this well renowned company for my rental investment property so that they could help me in achieving my financial goals through rental income. I had signed a rental agreement which has now ceased (has passed the agreed date on contract).

I saw few flags in the last year, during the change in tenancy and the marketing period. They would say that they have received lot of interests in the property (which is comparatively close to CBD), without advertising the inspection times. They mentioned that only those who applied online, would be informed about the inspection time to streamline the process. Each week there would be some excuse on why a contract was not signed or the property tenanted. Having no idea, I let them manage the property and it took almost 4 weeks for another tenant to enter into rental agreement. They mentioned that they have done proper background checks on the tenant and it met all the requirements.

6 Monthly inspection of the property after the tenants moved in was delayed. I insisted to attend the next inspection and found that the property was not kept in good shape and could see the damage done. I was not happy and waited for the inspection reports, which came in late and I had to make a decision to evacuate the tenants at the end of the agreement. Little did I know that one still needs to give the tenants a months notice, even if the initial agreement of tenancy period has expired. This was not even mentioned to me by the agent and I had to probe in to get the answers.

Once the old tenant were evacuated, full rental bond was claimed from the tenant by the agent to fix the damages done to the property. However I knew that the damages done to the property would exceed the monies int he bond.I was then informed by the agent post evacuation, that the tenants were behind in paying rent and part of bond money was taken by the agent.

Further to it, repairs on 3 separate occasions were conducted and I was not involved in making and approving the decisions. The first one was a bill of more than $400 and the second more than $300 to be drawn out of the claimed bond. When I requested in writing that I would like to be involved in the decision making in authorizing the repairs, I was provided with another bill of more than $350, when I had organised my own handyman to conduct the work post liaising with the agent.

I am just wondering if the agent can take decisions and approve repairs (which were not urgent repairs- cleaning, colouring etc) without the consent of landlord?

Firstly, do I have any rights over here and can I dispute the transaction as the money is already deducted from my account?

Secondly can I make a complaint against the agent? Is it worth the path or too much hassle?

Thirdly, can I request the agent to leave the rental agreement to me and what are the implications? Do I need to give notice to the agent?

Fourthly, I am willing to self manage the rental tenancy and wondering if I need to sign / transfer the rental agreement from the agent to my name? How best can this be done?

Sorry for the long story, but any tip / experience would help me in making the informed decision.

Thank you in advance for sharing your insights

Cheers,
Knowwhat

Financial

Comments

  • Zedsdeadbabyzedsdead on 26/08/2019 - 21:23
    +11

    I got halfway through and fell asleep, I'll read the rest tomorrow on my day off.

    • onetwothreefour on 27/08/2019 - 06:22
      +2

      Don't waste your precious day off on this dribble!

  • horice on 26/08/2019 - 21:30
    +3

    Maybe this not the Business for you !

  • Kangal on 26/08/2019 - 21:32
    +5

    Real Estate agents are one of the slimiest workers around, you should already know this.
    If you are buying or selling, they will pull all the tricks to get a sale. When it comes to rentals, they don't give a ratsarse.

    So because of that, you should have rental insurance, and ask for plenty of updates from the agents.
    Or if you want a better job, you can rent it out privately, this would save you more money and headaches in the long-run…
    …but it means you need to put in more of your effort and time upfront.

    So it's really upto you, on how to proceed with your investment.
    As for the current events, you just need to accept that this is a business and so there's always a risk. You lost this round in lost month, lost rental, damages and repairs. Just fix things now, and look forward for a better round 2.

    • Geoff-bargain on 27/08/2019 - 08:56
      +4

      I completely agree. I would also add that there is a company called www.cubbi.com.au which is a good balance between doing it yourself and having an agent. They take care of collecting rent and give you a tax statement at the end of the financial year. When you have repairs done is all through there portal with your chosen providers and you approve everything. You do the inspections and the listing yourself, although I think they have just introduced a service where you can pay someone to do the listing if you want. They charge 2% which is very good.
      I have been with them a year and very happy. Part of my happiness does come from doing the listing myself and choosing and excellent tenant though.

      My sister used and agent where a good friend of hers worked as an agent and they have been dreadful. Had tenant that didn't pay and trashed the place. Dodgy paint job that was organised by agent and had to go to tribunal. I would never go back to agent managed.

      • Dundundunnnn on 28/08/2019 - 04:38

        +1 for cubbi.
        I've been using for 7 months and love it. They even sort out lease documents and variations for things like pets at no cost.

    • knowwhat on 27/08/2019 - 18:13

      Thanks Kangal,
      I agree with you, lost the first round, hopefully better in the 2nd one.
      Planning to give it a shot of doing things on my own, considering we have the Airtasker, serviceseeking etc platforms to get repairs done if required in future.

  • elgrande on 26/08/2019 - 21:57
    +4

    Firstly,

    Little did I know that one still needs to give the tenants a months notice, even if the initial agreement of tenancy period has expired.

    How much notice did you want to give? Thought it would be common sense that at least some type of notice period would be required, unless your rental property is a tent.

    In regards to the repairs, your agreement with the agent may specify an amount that they are authorised to undertake without your approval. This is the case in NSW, however I note that most decent agents will still out of coutesy seek your approval.

    • knowwhat on 27/08/2019 - 18:16

      HI elgrande,
      You are right about the notice. Sorry, I am new to the whole rental/tenancy agreement space.

      I was under the impression that once the rental agreement expires, on the day of expiry, if the tenant has not indicated to stay longer, than s/he would move out. I wasn't aware of the rolling tenancy agreement.
      A good lesson learnt.

  • chcse on 26/08/2019 - 22:15
    +2

    While I have no good advice, I just want to say that I feel your pain. Currently experiencing a similar thing. The real estate agent wins screwing both landlord and tenant. The worst thing is that they can keep doing this as they have no accountability. The only place you can complain to is the real estate agent themselves (useless) or Fair Trading (no action will be taken).

    I think in your original contract you would have given agent the authority to make repairs on your behalf up to an amount. Unless you can prove something shady going on, I don't think you can dispute. Seriously, your situation is so similar to mine! Just wait until you get contacted two months later saying that the tenant has disputed the bond and you need to pay everything upfront until a decision is made at the tribunal.

    All in all, good luck!

    • knowwhat on 27/08/2019 - 18:19

      Hi Chcse,

      I hear you and felt the same that the estate agent was exploiting both the tenant and the landlord.Keeping my fingers crossed and hoping nothing comes through the tribunal.

  • z10cvbnm on 26/08/2019 - 22:21
    +5

    I learned it the hard way. If you see a few flags, it means run and appoint a different agent. I found that I still need to "manage" my property closely even when there is REA involved.

    • [Deactivated] on 27/08/2019 - 00:17
      +2

      If you see a red flag, there's bound to be heaps you missed and more you've yet to encounter.

  • Some Guy on 26/08/2019 - 22:25

    Your agreement with the REA probably authorises them to do repairs up to $1000 or so without your approval.

    They sound terrible and you're entitled to complain as you see fit but I don't know where it'd get you. They're probably more adept at fobbing of the likes of you than you are at extracting cash from big companies. You may be able to claim some losses on your landlord insurance.

    I don't think there's anything stopping you from heading into their office tomorrow to pick up your keys and telling them their services are no longer required. You will need to make sure your tenant does not pay rent into their accounts of course.

  • T-man on 26/08/2019 - 22:43

    What is the rental agent? I will have a property to be rented out next month, would avoid this agent or go it privately. Can anyone recommend me a good rental agent? Thanks.

  • johndowy on 26/08/2019 - 23:29

    How how is the weekly rental?

  • JFFTech on 27/08/2019 - 00:17

    I'm a tenant and after a year of tenancy, my landlord spoke to me and we both agreed to move away from the real estate agent. The bond transfer is a straight forward process and your agent will have to sign the necessary transfer form to your name. While there are pros and cons in going direct vs agent, if I were in your situation, I would go on my own. Just ensure to align with your current tenant before doing so.

    PS: I am looking forward to an AMA (Ask me Anything) post from one of the real estate agent. It would be a very interesting Q&A indeed :-).

    • knowwhat on 27/08/2019 - 18:22

      Cheers JFFTech,
      Was wondering if I could directly contact the tenant and then work it out between him/her and myself.Will give it a try.

  • [Deactivated] on 27/08/2019 - 00:22
    +1

    Your decision to extend the rental agreement was based on your belief that the tenants are paying on time.

    An integral part of the property manager (PM) is to ensure rent is paid.

    It can be easily argued that you would have evicted the tenants much sooner had your PM been doing the job you paid them to hence any delay in the removal of the tenants is caused by negligence on the part of the PM.

    • knowwhat on 27/08/2019 - 18:23

      Hi tshow ,

      Thanks for your comments. I am not sure whether the money was not paid and have some gut feeling that it was just mentioned to take some monies from the claimed bond. I could be wrong, as I do not have proof.

  • Meho2026 on 27/08/2019 - 02:44
    +1

    It’s usually written in the contract what value of repairs the agent can organise without consulting you.
    Just get a recommendation for another agent.
    Managing a property yourself can be very time consuming and a lot of grief.
    There might be someone on here who can recommend a decent agent if you tell us the suburb and city.
    If your property is currently vacant, other agents will jump on the chance to manage it so they can grab the letting fees.

    • knowwhat on 27/08/2019 - 18:26

      Hi Meho2026,

      The agent has already charged me with the letting fees for this new tenant.
      I agree managing the property can be time consuming, but have seen some of my colleagues managing 2-5 properties and working full time.
      Some of them are fortunate to have good tenants I guess.

  • Whisper Quiet on 27/08/2019 - 10:05

    All good agents will always inform you of any issues that tenants are complaining about and any repairs that needed be done before it happens (most of the time it's required in your agreement). Background checks and finding the right tenant was obviously bogus as you've gotten the worst kind you can get. You have a right to accompany them to the inspection and be allowed to see documents regarding rental payments and history, etc. It's usually the most popular real estate agents who are the most careless and lazy. Try and look for a newer and smaller one with a decent reputation. If it hasn't put you off them altogether. All the other things you mentioned, you should be aware of as a landlord. Always know your rights, obligations and contracts!

    • knowwhat on 27/08/2019 - 18:28

      Hi Monstalova,
      Good advice, I will search for the new smaller ones, who are committed to perform.

  • netjock on 27/08/2019 - 10:24
    +1

    Sorry to hear your experience. But here is 2c worth:

    1. Don't use an agent that doesn't hold physical inspections, online applications are just lazy.
    2. Check competitor fees
    3. Check on internet what comparable properties are renting out at. I had to drop my property $20pw compared to agent quoted number.
    4. They can do emergency repairs with an authorised limit, read your contract, if you are not happy discuss it or discuss it with another agent and go with them.

    Personal note, I think property is a bit of a mug's game now. If interest rates go to under 3% and it still takes 30 years to pay it off working for the bank you're better off regularly investing in shares considering 4% dividends plus franking credits.

    • knowwhat on 27/08/2019 - 18:29

      Hi netjock,
      Thanks for your tips. Will keep them in mind.

  • HighAndDry on 27/08/2019 - 10:25
    +1

    Firstly, do I have any rights over here and can I dispute the transaction as the money is already deducted from my account?

    You can always dispute it. How successful you are depends on what your agency agreement says. Very likely (but not 100%), it says the agent can use rental proceeds to make reasonable repairs.

    Secondly can I make a complaint against the agent? Is it worth the path or too much hassle?

    You can make a complaint, but whether it's worth it is up to you - will you get satisfaction out of it?

    Thirdly, can I request the agent to leave the rental agreement to me and what are the implications? Do I need to give notice to the agent?

    Yes, and yes.

    Fourthly, I am willing to self manage the rental tenancy and wondering if I need to sign / transfer the rental agreement from the agent to my name? How best can this be done?

    You need to transfer the bond and get the paperwork. The rental agreement is already in your name - you're the landlord. The tenant isn't renting from the agent, they're renting from you.

    • knowwhat on 27/08/2019 - 18:31

      HI HighAndDry,

      Thanks for taking the time and answering my queries separately.
      Appreciate it.

  • HeWhoKnows on 27/08/2019 - 22:07

    Just cut your losses and get rid of them Pronto!

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