Real Estate Matters | The most important questions to ask when you are a landlord – Part 1

Juliet Risdon

All property transactions are sizeable when compared with most other decisions.
It follows then that we should give these transactions the extra time and attention that they warrant, but this does not always happen.
In many instances it isn’t so much an issue of motivation, but rather not knowing the right questions to ask.
This series deals with key questions that we can, and sometimes should, ask. Knowing the answers to these questions can help to avoid misunderstandings and, in many cases, will save time, money or both.

The most important questions to ask when you are a landlord
Renting out a property can be both stressful and risky, especially if you are unfortunate enough to encounter a bad tenant.
The trouble is, even though you own the property you are also very busy during the day and want to minimize the issues with this and any other apartment.
If you are looking for an Agency to lease out your property and a Property Administrator to take care of it whilst it rented, it is important to do your homework and look for an established and professional company with strong systems.
The list below is in no particular order, and is intended as a starting point to help identify which questions to ask. Here are the first 5 of 20 questions;
Can I see a sample tenancy agreement?
Before you lease out your property, it pays to go through the Tenancy Agreement carefully and make sure everything that is important to you is covered.
There are many variations on a Tenancy Agreement, some are as short as one page and others spread over 20 pages or more.
Regardless of the length, it is advisable to go through the agreement and make sure the main points such as payment schedule, maintenance and deposits are all clearly documented.

What insurance arrangement should be made?
Generally speaking, the tenant is responsible for the goods inside the apartment and the owner / landlord is responsible for the infrastructure and rebuild should something happen to the property.
As such, insurance packages should be purchased accordingly.
It’s a good idea to cover this point in the Tenancy Agreement to avoid any mis-understanding.

What happens if a tenant reserves the apartment and then changes their mind?
Generally the process in taking an apartment includes paying an initial deposit, without which the property will not be taken of the market.
Once the initial deposit is received the agent should give a very specific time frame to the tenant to let them know the timeframe for signing the agreement and paying the full security deposit (usually 2 months rent).
If the tenant changes their mind, the deposit remains with the landlord and the property goes back on the market.

What price do I want to achieve?
Asking this question will give you your top price, and answering the next question will give you the bottom price. You then have a rental ‘range’.
Achieving the best price is not always the no 1 objective. The equation depends also on the quality of the tenant and their treatment of your property.

What’s the minimum rental amount I am willing to accept?
Following on from question 4, the minimum rental or your ‘bottom line’ is important to know in case you are presented with a high quality tenant.
In this scenario, a high quality tenant willing to ay the minimum rental may end up being a far better outcome than a low quality tenant paying top rent, but not looking after the property, paying late etc.
The other reason for knowing your bottom line is so that you don’t always accept the first offer that comes your way, especially if it is lower than expected. Juliet Risdon

Next Week: How do I handle a tenant who does not pay rent on time?

Juliet Risdon is a Director of JML Property and a property investor.
Having established the company 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.

www.JMLProperty.com
info@JMLProperty.com