Tenant Trashed Rental Property and Has Done a Runner - Tips

MementoMori on 05/05/2023 - 22:45

Hi guys, hope you're all well!

I've got a situation where a long term tenant has moved out of my property, leaving the place in a complete disaster - holes in practically every wall, significant damage over and above fair wear and tear (not 'malicious' as such, just filthy pigs) and lots of hard rubbish on the property, junk in the backyard, garden overgrown and in a very bad state.

I estimate around $10,000 - 12,000 to get it back to a basic, rentable standard (inc. lost rent).

The place was professionally managed by a Harcourts in SE Melbourne.

I was very surprised to hear there is no bond, during a changeover (tenant?) of some kind the tenant was refunded their bond a new one was not collected! I also asked the PM why the holes in the wall were not fixed during the tenancy and was told they deal with that during tenant move out… also a surprise.

I have up to date Tenant Insurance through Terri Scheer. I have had the property for 10+ years and it has been insured most of this time, although I am concerned Terri Scheer might cause issues with my claim because I only renewed the policy a month ago after having it expire for 1-2 years previously (pure coincidence - over the years I forgot to pay the renewal from time to time but it has been mostly insured).

The tenant is a real ACA type, who has threatened legal action over a hole in the bathroom floor. This was caused by the tenants negligence, allowing water to sit on the bathroom floor over the years causing it to rot through. It was 'made safe' ASAP (the same or next day) we were notified of the issue, which caused me to then look further into what was going on here then shortly after the tenant moved out.

The tenant is blocked all contact, has verbally said she doesn't have to do anything and has bought a new property somewhere.

Anyway, while emotionally it's a real blow - I understand I just need to clean it, fix it and get it rented ASAP as well as trying to claim as much as possible through insurance and VCAT.

Can anyone who has been through this offer any tips and tricks?

Thank you

Home & Garden

Comments

  • Hearthstone on 06/05/2023 - 21:17
    +2

    have you post on property chat forum, lot of experience people there to help you out

    https://www.propertychat.com.au/

  • Trying2SaveABuck on 06/05/2023 - 21:56
    +2

    you're in Victoria so bar what you might get from insurance and i am fairly confident you will have to battle to get them to cover you there isn't much you can do

    The tenants have more 'rights' then the landlord - the good thing is the tenant has moved out so 10-12k loss in 'not that bad' [yes you have has this property for 10 years it would of hopefully appericated 2-3x that of the purchase value]

    my advice is hit up insurance, sack your RE agent they sound hopeless [although most of them are] - and move on

    an investment property is 'an investment' this is just part of the cost of doin business 12k isnt bad - chances are you will get most of it back via LL insurance but you probably will have to go to court as LL insurance is useless unless you're up for a 'fight' as the pricks try and get out of everything - it more depends if you are willing to go to court, do the leg work after they deny your claim - your PM was useless so that will work against you

  • CommuterPolluter on 06/05/2023 - 22:49

    What kind of holes in the walls? Like punch holes or nail holes associated with paintings?

    • MementoMori on 10/05/2023 - 00:15

      Full on punch holes. Practically every wall has them. On one bedroom wall, there is like 10+

  • DemocracyManifest on 06/05/2023 - 23:14
    +1

    Take legal action against the agency, clean up and re-rent, get an accountant to assist with the depreciation. Holes in wall should have been fixed during tenancy along with garden and hard rubbish - and bathroom issue. Agency didn’t keep bond - and the stuff with the bathroom sounds shaky.

    • MementoMori on 10/05/2023 - 00:16

      Honestly it's just a 30 year old (unrenovated) house and the tenant didn't take care of it. Perhaps just old age too.

      There was poo from their pets etc everywhere too.

  • richrichie on 07/05/2023 - 01:27
    +2

    The RE / PM sounds very unprofessional, no bond and no regular inspections. All the rental agents that I've had to deal with seem to always inspect the property that I was renting at every 6-12 months, or at least to send them latest photos during those intervals. If I am in your position, I'll probably try to have a conversation with RE/PM first to get them to be responsible for a property management that you have been paying them money for.

    And wow, so many negative comments that are not helpful to the topic. I get that many people in the forum here are against property investments, but surely dodgy real estate agents and bad tenants are not any better? Surprised to see many of the comments that seem "happy" that this happened to OP and rub it in on someone's problems, sounds very toxic.

    • MementoMori on 10/05/2023 - 00:18
      +1

      Thanks.

      Yes, an Aussie who moves overseas and so he rents out his house (because I couldn't sell it at the time) is somehow worse than the person who trashes it and the PM I paid who didn't manage this situation.

      And selling the house to buy shares in a bank that makes billions in megaprofits is also more honourable.

  • duluxe2000 on 07/05/2023 - 02:13
    +3

    The best advice I can give you is that this should not affect you emotionally. You are NOT financially worse off because:
    - You have rent for 10 years n this is the 1st time you get this kind of tenants, consider yourself lucky. Every landlord will get one.
    - You bought the house 10 years ago I can imagine the capital gain you get if you decide to sell. Also the rent amount last 10 years should easily cover 10-20k.

    So chill out, get the house fixed, rent it out, change the RE, chase the insurance company…you will still profit in the end, don't you?

    • MementoMori on 10/05/2023 - 00:19

      Thanks for the helpful post!

  • Miss B on 07/05/2023 - 08:30
    +2

    It was 'made safe' ASAP (the same or next day) we were notified of the issue, which caused me to then look further into what was going on here then shortly after the tenant moved out.

    You're saying all of this happened less than a month ago and had nothing to do with renewing your insurance after > 1 year? Either way, it sounds like all of the issues were from more than a month ago, so wouldn't be covered.

    Your property manager should be chasing the money from the ex-tenant I would think. Depending on what happens there maybe you can go after the property manager for not doing their job.

  • Dack Smith on 07/05/2023 - 08:34

    Harcourts REA are they any good?

    Sounds like OP has been hard done by them

    • CocaKoala on 07/05/2023 - 10:05

      You might have answered your own question.

  • AuQld on 07/05/2023 - 10:22

    I could easily buy two investment properties but it's never worth it. It's a bit like Bitcoin if you bought a few in Sydney in the 80s/90s you're laughing otherwise forget it. Interest in a bank, risk free, stress free, zero work. I'll hook into a term deposit in a few months for 5 years, keep some funds for when the Market tanks 40%+..

    • drfuzzy on 08/05/2023 - 07:41

      For mediocre effort you too will achieve mediocre returns

      • AuQld on 09/05/2023 - 10:43

        Risk, effort has nothing to do with it..

  • tomleonhart on 07/05/2023 - 11:20

    The tenant is blocked all contact, has verbally said she doesn't have to do anything and has bought a new property somewhere.

    Thrash the place then buy elsewhere. Effectively secure herself a place and at the same time cause pain so the LL will have to think twice of getting another investment property in the future.

    Smart tenant. Would hate to deal with these tenants myself.

    • Protractor on 08/05/2023 - 18:42
      -1

      "has verbally said "
      I find that is the best way to say words. What a pity the OP did not have the same skill. He/she/they could have (a) verbally said something to the PM to get it properly PM'ed, or (B) said words to tenant face to face.
      This thread epitomises why sympathy is wasted on greedy landlord investor types. I pity the next tenant.

  • pufffdragon on 07/05/2023 - 11:23
    +1

    The place was professionally managed by a Harcourts in SE Melbourne.

    Obviously not. I'd be pissed at them also.

  • TheBiggerG on 07/05/2023 - 13:08
    +20

    I deal with properties like this frequently through my work… and a few things aren't adding up in your description.

    1. Floor in bathroom
      How was water gathering on the floor in the bathroom? Where was it coming from in that sort of volume? I would be looking a the shower being the most likely culprit and it leaking in under the tiles. Just "dropping things on the floor" isn't going to do this. The would have literally had to flood the floor daily over a number of years (this leads to point 2). The other issue here is this evidences a lack of proper water proofing, as many have already pointed out. These things are not Tenant Related Damage. This is a you problem. Also doing a "make safe" does not constitute a repair under the Residential Tenancies Act 1997. You have to actually carry out the full repair as soon as possible following the make safe.

    2. New build…
      The property was purchased 10 years ago / it was a new build - Pick one!
      A 10 year old property isn't a new build; for most modern build purposes it's coming to it's end of life as the Builders insurance has just dropped off, which is sadly how long many builders, especially volume types, build a house to last.

    3. Your description of the damage vs cost to repair.
      This does not add up. I do this for a living and your "estimate" which is curious as to how you have done this from overseas, but that aside, $10-12k including rent for a place that was a "complete disaster" with holes in "every wall" does not add up at all… especially when you add in the cost to repair the bathroom. Which you are clearly not doing, because that would take at least half of that money if you were doing it cheaply.

    I should caveat this with - Unless you are renting out one of those tiny dog box properties that are a 1BR where the only bathroom is an en-suite and the lounge, kitchen, dining room are all the one room. That could for really cheap badly done repair could cost $10-12k to repair… could… and not including the bathroom.

    1. Your insurance won't pay
      You clearly only re-instated it when the tenants were leaving or had already left. If you try to lodge a claim using made up dates and information you are committing insurance fraud, which most insurance companies check for (they are used to people trying to rip them off) and don;t take well to, as it's a criminal offense and can cause you to be unable to get future insurance in Australia, which can make life problematic.

    2. VCAT

    You will have to prove that the damage was caused by the tenant,m so your photos will need to be within 24 hours of the tenant vacating. Don't try to claim your bathroom as VCAT members deal with property maintenance claims all the time and will reject it on the basis that the area was clearly not properly sealed, a you problem, and then will take the view that you are trying to make an illegitimate claim and will begin knocking the claim down. They don't like it when people appear to be trying to dupe them. Not saying you are, just giving you a heads up.

    Getting also a claim through VCAT does not immediately guarantee the previous tenant will pay the money. There is a follow up process where the order to repay money will need to be ratified by the magistrates court to formally make is a court order, that then is enforceable. I don't know of anyone who has done this, but I personally believe more people should, it creates accountability for the damage.

    1. The Real Estate Agent
      They should have been monitoring this better, but clearly weren't. This sadly isn't that surprising and not that uncommon. Read through your contract with them, you may be able to get some compensation through them for breach of contract. This would probably be your best bet for getting some form of compensation.

    Lastly in reference to your user name Momento Mori…. Amor Fati!

    • onesandtwos on 08/05/2023 - 18:06

      Wish I could give you more than one +1 for the detailed and informative reply. No wonder the OP has gone a bit quiet…

    • DemocracyManifest on 10/05/2023 - 21:26

      It says 30 years old in another reply lol

  • Fysh on 07/05/2023 - 13:30
    +1

    I received back fees from property manager for this very issue. With my brother's property, the landlord insurance didn't pay for all of it. The property manager is just that The property manager should have organised for issues to be fixed during the tenancy and charged the renter. This is a situation where the real estate agent has not performed their basic task. Send them a well worded letter instructing they have not performed their service and that you want a refund for the total time they managed it. Then settle for as much as you can. Take them to VCAT. For services paid not rendered.

  • Bluto Mindpretzel on 07/05/2023 - 16:54

    Welcome to the world of investing.

  • Rukiata on 07/05/2023 - 18:07
    +1

    OP are you lying? I want to know the full story here. and hear the tenants side of things.

    sounds like an old house and issues you never fixed or upgraded?

    Show pictures for proof of holes..

    • Protractor on 09/05/2023 - 10:01

      If they are lying about the REA part, and a Harcourts employee spots this thread, things will warm up

  • Ace26 on 07/05/2023 - 18:52
    +1

    Mate, it's not worth your time fighting over this, lodge claim with insurer and see where it takes you. PM looks to have failed at their job for not collecting bond but did they do periodic inspections and provided your copies of these reports? If yes, these reports should support your insurance claims. If not, perhaps you may have be able to recover management fees you paid to your PM

  • cobknob on 07/05/2023 - 18:58
    +3

    Sounds like this place wasn't managed very well at all. Not only your fault but estate agency as well. Bond collection is more your fault too lol. You have to keep on top of your property paperwork. Agencies manage but you gotta crack the whip on em.

    I actually find it laughable that people choose the wrong tenants all the time, and for people like me, never damaged a thing, and are generally good tenant(s) I'm in the gutters cause my landlord was a bitch! and I couldn't get a rental in time so I'm floating at the moment, and have been for 6+ months. All those investment property owners taking top dollar, not finding the right tenant or not doing maintenance go suck a lemon and learn some lessons.

    I don't sympathise either cause it's your responsibility to be on top of your rental and it doesn't take much when having a property managed - just tell the agency you want photos of inspections (*damage only), and maintenence and to ensure it's generally clean,etc - having a basic checklist/audit every 3-6x months which you look at for an few hours gives peace of mind.

  • Daddy Chill on 08/05/2023 - 07:04
    -4

    Serves you right for being rich

    • drfuzzy on 08/05/2023 - 07:43

      Aren't you just a cherub?

  • spoonmugen on 08/05/2023 - 07:25

    sounds like a shit PM - i'd change after they got it back to rentable state…
    did they organise insurance at least?

  • paul09 on 08/05/2023 - 09:16
    +10

    What a great thread

    • OP hilariously owned in multiple ways, corner cutting everywhere, deserves the owning
    • Bonus of OP living overseas while renting out property here, lol
    • Terrible house quality (bathroom) somehow turned upside down into complaining about tenant
    • Insurance lapsing during the period much of the damage occured, 10/10
    • Many jobless bum communists crying about landlords because they can't afford a house on account of joblessness
    • Communist bums crying about 'moral investments'
    • Par for the course property manager being completely incompetent and useless
    • jaimex2 on 08/05/2023 - 10:24
      +2

      Spot on summary

    • [Deactivated] on 08/05/2023 - 11:55
      +2

      Missing an item:

      • Other lazy deluded small time landlords thinking their 'investment' deserves special treatment and protection over other types of investments.

      (The same deluded lazy bums who find 0 fault with op, and are so used to loopholes that they are encouraging op to believe he has a chance of getting an insurance payout despite letting his policy lapse for 2 years)

    • drfuzzy on 08/05/2023 - 13:07
      +1

      summary very good but insufficient mention of communists

  • ednamekin on 08/05/2023 - 09:38

    I had a similar situation when a tenant in a now-sold property essentially trashed the place - stained and damaged blinds, doors, walls etc - all up around $18,000 in damages + several weeks of unpaid rent. I was fortunate however that my property manager was great, and managed through Terri Scheer to get all damages paid + 12 weeks of unpaid rent claimed.

    In your scenario it sounds like the property manager should really be the first pain point - the PM should be the one organising repair quotes and dealing with Terri Scheer, i.e. managing the property. Contact them and get them to manage through, though you should escalate to the top dog.

  • dogboy on 08/05/2023 - 09:56

    Is legal action against the REA an option here?

    • jaimex2 on 08/05/2023 - 10:24

      Yep.

    • ripesashimi on 08/05/2023 - 11:40

      If you can prove that they breach the agency agreement. Industry standard agency agreement does not impose that much obligations on REA.

  • trapper on 08/05/2023 - 11:32

    I estimate around $10,000 - 12,000 to get it back to a basic, rentable standard (inc. lost rent).

    It doesn't sound like it would cost anywhere near that imho.

    But do all the repairs as quickly as possible and take the tenant to small claims to recover the costs.

  • GourmetFoodie on 08/05/2023 - 12:31
    +1

    I’d be talking to the director of harcourts! Where were the regular inspections? They totally f-Ed up on the bond! This is why you pay them. I’d be asking for multiple thousands. Fight hard and you can get something for sure.

  • BargainBogan99 on 08/05/2023 - 12:34
    +4

    You came to the wrong place looking for advice as a landlord.

    If you were your tenant and looking for tips on how to skip out and cause the most pain you'd probably have an overwhelmingly positive response on here…

    • Yola on 10/05/2023 - 08:07

      Yes you should go to propertychat.

  • drfuzzy on 08/05/2023 - 13:10
    +2

    OP appears to have done a runner from the thread like the tenant did a runner from the property damage.

  • Dubsys on 08/05/2023 - 13:19
    -1

    Sell it and let someone new get a home

    • Drpepper666 on 08/05/2023 - 17:44

      lol

    • [Deactivated] on 08/05/2023 - 18:43

      Or at the very least let a competent landlord take over. The amount of oversights here over a period of YEARS is the height of small fry landlord clownery. Individuals like this do not deserve to make judgements over matters relating to the roof on people's heads.

  • Dack Smith on 08/05/2023 - 14:49
    -1

    To be fair and equitable, landlords deserve nothing and should have no rights.

    There should also be a hard cap on rent increases and rent amounts as well.

    This has become a class struggle and we cannot let the elitists win.

    • Drpepper666 on 08/05/2023 - 17:44

      lol

    • bobolo on 09/05/2023 - 13:21
      +2

      Thank you. Your message has motivated me to increase rents on all my tenants without any concern for their well being or affordability

      • tonka on 09/05/2023 - 15:17
        +1

        This whole thread does to an extent validate people and companies who leave a property empty to me. And to be honest the additional risk evident in this lynch mob mentality kinda justifies landlords charging the highest rent they can. I had been letting a room, not gonna now.

        • bobolo on 09/05/2023 - 17:52
          +2

          Yes absolutely. Don't shit where you eat. (or in this case sleep)

          Plenty of great landlords out there…plenty of great tenants as well

          Its laughable that some actually think if all landlords disappeared everyone can magically afford a house to live in.

  • Protractor on 08/05/2023 - 18:34
    +2

    If this is your property how did it go so bad with appropriate oversight?
    If this all happened in the last weeks since an inspection you have a reason to complain.But this sounds like cumulative damage.

  • Protractor on 08/05/2023 - 19:59
    -1

    Eat real estate investors.

  • jar-unit on 08/05/2023 - 20:16
    +2

    Did you have regular inspections? didnt they ever show anything of concern?

    • Protractor on 08/05/2023 - 20:38
      +3

      I seriously doubt any of this story is real. Much like a lot of threads on the forum

  • CheeryCheapskate on 08/05/2023 - 22:27
    +1

    I can only speak from my experience. I had a tenant that damaged my property and ran off in the middle of the night. I went through VCAT and my real estate agent got a fair amount, actually a lot more than the bond we held onto (basically I was happy with VCAT's outcome). I only had to show invoices to repair the damage and my agents did the rest. My property wasn't too bad however it did end up costing near $10K to repair and clean up (it was mainly paint, cleaning, rubbish disposal, a door, a window and two fences were down although a few areas I had to pay out of pocket as I couldn't prove tenants damaged some parts).

    But sad to hear OP, it's always bad when horrible tenants damage someone's hard earnt investment. I wish you all the best!

    • JimB on 09/05/2023 - 11:44

      who paid? tenants or insurance?

      • CheeryCheapskate on 09/05/2023 - 21:44

        We were able to retrieve money from tenant via VCAT. It was close enough to cover all the damages they did so insurance didn't need to get involved. And I just paid for other repairs and fixes that were more along the lines of "general" rather than tenant damages. My tenants did try to repaint the house but probably thought it was too much work so they did a runner. I did see paint buckets lying around.

        But as a few mentioned, it was just bad luck and bad tenants which I got when Covid lockdowns hit so tenant choices were a lot more limited back then.

    • idonotknowwhy on 09/05/2023 - 12:54

      a door, a window

      I don't understand what possesses people to do this?

      • Protractor on 09/05/2023 - 13:53

        Drugs,alcohol,anger,mental health issues,vandalism,frustration…….just wanton recklessness…
        Not all humans are model citizens.
        But, given the possibilities, I'd rather it was doors and windows taking the brunt, than someone's flesh and bone.

  • JimB on 09/05/2023 - 15:14
    +4

    Reading all the anti-landlord/rental provider/investor sentiment in here, I thought I was reading Reddit for a while.

    Bad luck OP, unfortunately you copped a bad tenant. Get yourself a new property manager. Unfortunately you'll have to cop most of the costs.

    Just like all investments, it's not great all of the time. At least they have moved out and you have possession.

    The worst cases for landlords are major damage, methamphetamine manufacturing and not being able to evict a non-paying tenant.

  • Jinster on 09/05/2023 - 15:45

    Consider going to court.

  • Name on 09/05/2023 - 18:28

    This story makes no sense. There is no way a bond wasn't held, and no way that the bond was refunded without an inspection. When I used to rent it was always a long drawn out effort to get my bond released.

    My IP makes about $25k per year, my tenants have been there for 5 years now (so they've provided around $125k in revenue) if they trash the place on the way out I'd still be happy. Particularly as the reno to fix all their damage would be tax deductible and may end up improving the condition of the property when done (fresh paint / manicured lawn and garden / repair all the picture frame holes and that while they are repairing damaged walls). On a worst case scenario I'd be paying it myself, best case insurance covers it all and I end up better off.

    • Protractor on 09/05/2023 - 20:06
      +1

      I agree,no sense at all.It just seems like a once "upon a time", to stir the pot. (It's a thing these days. )
      Works doesn't it?

    • tomfool on 10/05/2023 - 07:53

      if they trash the place on the way out I'd still be happy.

      That's a good way to go broke.

      • Name on 10/05/2023 - 08:25

        How? I'd still be 113k better off having let them live there if it cost 12k to repair. Which it wouldn't as I have insurance. So it'd cost me nothing actually and might be able to rent the place out for more afterwards because it's all fresh.

        • tonka on 10/05/2023 - 12:20

          Are you saying you make $500 a week above the cost of the investment? Wouldn't that mean you have a high value property that would be very expensive if someone trashed it.

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