PETS ON PROPERTY
Question:
With the new laws coming into place allowing tenants to have pets in strata buildings, I’m worried about the increased chance of damage to my property. Do I have any rights of refusal when it comes to pets living in my unit? How can I enforce any rights I might have? How can I make the tenant accountable for any damage?
Answer: This is certainly an interesting change in circumstances that landlords are now facing – for some it is hard enough to ensure their human tenants take care of the property! Fortunately, the answers to your questions are straightforward.
Firstly, you need to clarify when you were made aware of their desire to house a pet at your property. If your tenant made you aware from day one (ie prior to moving in), you should have stipulated the details of housing the pet and your expectations in the tenancy agreement. If you are being made aware of the new circumstance after the initial agreement was signed, your tenant must put in a written request for permission to house a pet on your property. This must be done before they actually commence housing the pet at your property.
Regardless of when you were made aware of the pet, it is important to ensure a ‘pet clause’ exists in the residential tenancy agreement, as this allows you to outline the tenant’s responsibilities. Make sure you cover areas such as cleaning, reparations, species and number of pets allowable, as these specifics will ensure you have something clear and certainly enforceable in your agreement with the tenant.
If you have a unit, you should check if your strata scheme allows pets. Strata schemes can be of great assistance when it comes to monitoring and enforcing the rules regarding pets, especially if they have a clause in their own by-laws regarding their housing.
In short, as always, it is essential that all parameters are clearly set out for all parties prior to any agreement being finalised.
– Nicole Keene
RENTAL INCREASES
Question:
Due to the recent hot weather we have experienced, my tenant requested that I install an air-conditioning unit in the top-floor unit they lease. I can understand their need, but can I charge them extra for this change in infrastructure? Is a $20 per week rate increase a fair estimate? These tenants have not had an increase in their rate for over a year, so I feel this would be acceptable. I am unsure about what to do, as I am concerned they may end their tenancy if I don’t install the unit, but I would also like some return on my investment.
Answer: This is a dilemma facing many landlords – just how much should you bend to meet your tenant’s additional requests and what remuneration can you seek? An important factor here is your understanding of the comparable rental market for your property. It may have been a year since their last increase, but how has the overall market performed since then – has it gone up or down? You should ask yourself how many similar properties have air conditioning included for the same price.
Obviously, you want to minimise the likelihood of the tenants looking elsewhere and finding somewhere they would perceive as an ‘upgrade’ within a comparable price range. This exercise will give you an understanding of what, if any, increase would be within reason.
Your tenants are perfectly within their rights to request the installation of the air-conditioning unit, so you should be prepared to negotiate. If you do agree to install the unit, you should be able to clearly explain and justify any resulting increase in rent, so ensure you know the market and what should be acceptable.
Keep in mind that if the tenant chooses to terminate the tenancy, you will then have to go through the process of finding a new tenant, who may or may not be as good as the incumbents. Furthermore, if you cannot find a new tenant immediately, the cost of the vacancy period and the reletting costs will take some time to recoup.
The lesson as always: know your market and work with your tenants where possible. It often pays off in the end. – Nicole Keene
LONG VS SHORT LEASES
Question: Given the current economic climate, is now a good time to consider offering shorter leases in order to raise rent rates, or should I maintain the standard 12-month lease? What are the pros and cons of each and when should I consider a short versus long lease?
Answer: All property owners should know that if you have agreed to a fixed-term tenancy, you cannot terminate the agreement prematurely during that period. The other key factor is that you can’t increase the rent during this time, unless it was negotiated and inserted into the tenancy agreement (under Section 56) prior to it being entered into by both parties.
In my opinion, six months is the most common agreement we see today. However, it is important to have a good knowledge of the market in your property’s area. If the market is high, you should aim to lock in a 12-month agreement, while in a low market it makes more sense to enter into a three-month agreement, allowing you to review the rental amount.
As always, if you are unsure, speak to a professional. Personally, I have begun to re-sign six-month renewals with many of my tenants, having locked them in for three months over the Christmas period. We all know that things pick up in the new year, and I like to be prepared!
– Nathan Birch
