The last 5 facts in the series. Hopefully you have found them interesting…
16. GROUNDS FOR TERMINATING A RENTAL AGREEMENT
A landlord may terminate a rental agreement if the rent remains unpaid, if the tenant uses the premises for something other than stated in the rental agreement, if the tenant carries out alterations without permission or if the tenant sub-lets without permission.
A tenant may terminate a rental agreement if the property becomes uninhabitable due to some major issue such as a permanent loss of power in the building, burst pipes inside the walls causing continuous flooding. The agreement may also be terminated if the building becomes unsafe or unstable.
17. A LANDLORD IS ENTITLED TO ONE MONTH COMPENSATION FOR EARLY TERMINATION OF THE AGREEMENT
If an agreement is terminated prior to the end date, the landlord is entitled to retain an amount of up to 1 months rent according to Macau Law.
Even if the agreement states that the tenant may provide 90 days notice at any time during the contract, the landlord may have one month rent as compensation. But the compensation cannot be set at an amount exceeding two months rent under Macau Law.
In practice, it tends not to happen in Macau, as most tenants and landlords prefer to stick to the contracts they sign.
18. THE MOST COMMON MISTAKE MADE BY TENANTS
Tenants often move from building to building looking for a better apartment, nicer facilities, a better landlord etc.
The cost of re-locating, factoring in moving costs, agency fees, the cost of your own time and of course the stress of the move itself, and it all becomes quite expensive.
In general, when you rent a property it is far more cost effective and less stressful to spend a little time, money and attention turning it into a place in which you are happy to live rather than constantly ‘shop around’ for a new apartment.
19. THE MOST COMMON MISTAKE MADE BY PROPERTY OWNERS
Property owners often boast that they ‘don’t pay agency fees’. Ironically, it is this ‘non payment of fees’ that usually ends up costing them their shirt.
Agents are marketing and promoting properties for a living, and like many people they don’t like to work for free.
When owners insist on not paying agency fees, agents have been known create a fee buy adding an extra amount to the selling price. This is a practice we have written about before.
Instead of working for the owner, the agent works for themselves, and suddenly they are motivated to give the lowest price to the owner and the highest price to buyer.
We estimate this practice costs owners an average of between HK$100,000 and HK$200,000 per transaction.
(Note: The practice of ‘flipping’ has been dramatically reduced thanks to the new additional stamp duty if a property is sold within 2 years, but it does still go on).
20. THE MOST COMMON MISTAKE MADE BY BUYERS
The most common mistake made by buyers is procrastination.
Looking back on last year, the vast majority of buyers end up regretting the deals that they did NOT do.
Trying to save $50,000 on the purchase and squeeze sellers for a rock bottom price is often the undoing of many an ambitious buyer.
In reality (no pun intended), $50,000 spread over the lifetime of the property is of very little significance. Wise buyers know this, and tend purchase the right properties quickly and quietly when they become available.
Juliet Risdon is a Director of JML Property and a property investor.
Having been established in 1994, JML Property offers investment property & homes. It specializes in managing properties for owners and investors, and providing attractive and comfortable homes for tenants.