Investors considering privately managing their properties have been served a reminder of the cost that can come with not doing it properly by Western Australia’s Consumer Protection department.
A Perth landlord was recently handed a $7,200 fine and ordered to pay another $396 in court costs after she plead guilty to 24 breaches of Western Australia’s Residential Tenancies Act.
The landlord received eight $500 fines for failing to lodge bond with the Bond Administrator and failure to provide a receipt for the bond and 16 $200 fines for ailure to use the correct form and information when entering into a written tenancy agreement and failure to provide a property condition report at the start and end of a tenancy.
According to Consumer Protection, she kept bond monies in her personal bank account or safe and created her own lease agreement, which included conditions that were not acceptable, such as no children being allowed to visit the property.
Standard lease agreements were made mandatory in Western Australia, while providing condition reports is also compulsory.
Bond money is required to be lodged within 14 days.
Mark Whiting, director of property managers Access Property, said the three areas where the landlord was found to have breached regulations where the most common areas where private landlords find themselves in trouble and he believes it’s getting harder and harder for private landlords to keep up with current legislation.
“Here in Western Australia we had something like 110 changes to residential tenancy legislation happen at the start of July 2014. Because of the size of those changes there was a big campaign to make sure everybody was across those changes and I think a lot of private landlords took notice of that,” Whiting said.
“But the thing is there are a lot of smaller changes that happen from time to time and don’t get that publicity and unless you’re really across everything you’re going to miss those and that’s where I think a lot of private landlords get caught,” he said.
While he believes private landlords are running bigger and risks trying to manage properties and tenants on their own, Whiting said current rental conditions, particularly in Western Australia, have people believing they can’t budget for the services of a property manager.
“The number of private landlords seems to be stying pretty steady. With what’s happening in the rental market here people seem to be thinking that a property manager is something they can’t afford so they’ll do it themselves.
“The reality is that you’re probably costing yourself money if you do it yourself. A good property manager is going to probably have a better understanding of the market than you do and will be able to be much more efficient in renting the property out and getting you the best return.”
For those that do choose to go the self-managed route, Whiting urges them to make sure they understand the potential penalties they could face if they slip up.
“I really don’t think most private landlords have any idea of the size of the fines they can be hit with for not doing the right thing. Consumer Protection in the last year or so have gone from saying ‘you can be fined for this’ to ‘you will be fined for this.’”
“It’s all well and good to think you’re going to save money by doing things yourself or you can’t afford a property manager, but only one fine could easily cost you more than a manger would.”
