Having successfully found tenants for your property, a key part of being a successful landlord is managing your tenants after they move in. We outline the top tips.
Is managing tenants for you?
Having sourced good tenants, one of the first considerations is whether you will manage the property yourself or use the services of an agent.
Managing investment property can be a time consuming activity and requires a lot of effort to:
· Ensure the rent is paid on time
· Deal with on-going repairs
· Handle tenants’ issues and complaints
Do you live close enough to the property to respond to phone calls from tenants? Tenants expect a landlord who is responsive. Do you have the time and the desire to be this involved with your property? If not, consider handing the property over to an agent. Agents’ fees are an allowable expense against tax on rental income.
Start off on the right footing
If you decide to manage the property yourself, it is important to get the relationship off to a good start by having a lease agreement in place that will outline the responsibilities of both parties. Always use a lease agreement that complies with the Residential Tenancies Act 2004. A good lease agreement is essential to the effective management of investment property and it helps to avoid disputes and disagreements during the course of the tenancy. The lease should also highlight that the deposit paid by the tenant cannot be used as the final months rent. Always ensure that the tenant is aware of the content of the agreement that they are signing.
Avoid disputes - use an inventory of contents
One of the most common areas of dispute between landlord and tenant relates to the contents of the property and its condition. An inventory is the itemisation of the contents of the property and their condition. Every landlord should have an inventory for their property, as it outlines not only what is in the property, but also what condition the contents are in at the time of letting. This can help to prevent disputes when tenants move out. Be prepared to expect normal wear and tear during a tenancy.
It is also a good idea to take photographs of the property and its contents so that you have a photographic record of the condition of all aspects of the property.
Register the tenancy
Having signed the lease agreement and completed an inventory of contents make sure you register with the PRTB. Every landlord must register a tenancy with the PRTB within 30 days of the tenancy commencing (i.e. the tenants moving in). This costs €70 and is a legal requirement. Only landlords who are registered may avail the PRTB’s dispute resolution service. It is available to all tenants regardless of whether their landlord has registered.
Manage the relationship
Being a landlord is a business and like any business you must manage the relationship with your customers, in this case your tenants .It is no longer good enough to move tenants in and hope the rent will be paid on time and that you will never hear from them. Market conditions have changed and tenants now expect a landlord who is professional and business like and provides a good property at a fair rent. Tenants want a landlord who will respond promptly to phone calls or messages from them and will deal quickly with repair or maintenance problems.
Inspect the property a few times a year to ensure the property is being maintained and looked after. Keep your promises - if you commit to getting something done, then get it done! Keep a professional, polite attitude to retain the respect of your tenants. Once the tenants are paying their rent and maintaining the property, keep your distance and respect their privacy.
When things go wrong
When things go wrong do not bury your head in the sand. If you have taken the time to screen your tenants properly and if you have a good lease agreement in place, disputes are less likely to arise. Many mis-understandings can be easily resolved by good communication and reference to the lease agreement, which should have clearly outlined the terms of the tenancy. If the tenants are in breach of their obligations and a solution cannot be found it may be necessary, as a last resort to serve notice on the tenants. Always follow the rules and regulations and do not breach the tenant’s rights.
Money, Money, Money!
As a landlord you must take a pro-active approach to managing your finances.
Open a separate bank account for rental property income and out-goings. Get the rent paid by standing order into the account and use internet banking to ensure the rent is paid on time. If it is not, act promptly and contact the tenants immediately.
Keep accurate records of all income and expenses and keep all receipts. Treat it like a business and review your costs on an annual basis. As a landlord you are required to make an annual tax return.
In the current market conditions the landlords who are successful are the ones who offer a nice property at a fair rent, and who take a pro-active approach to managing their tenants. Their tenants will stay longer and they will have less vacancy periods resulting in a better financial return on their investment.