Communicate regularly and be fair for a healthy tenant-landlord relationship

LANDLORDS with fewer than 10 properties often manage their properties and their tenants themselves.

In these cases there are sometimes certain aspects of property management, rental collection or tenant selection that they might need guidance on, says Michael Bauer, general manager of IHFM property management company.

If the property is not maintained properly or the occu- pancy of the unit not kept at a steady rate, the investment’s profitability or even viability is lessened, says Bauer.

“Tenants who are good payers must be looked after to keep them in place and not risk losing the steady income they provide. Tenants will often leave the premises at the end of their leases and some will even cancel their leases if they are unhappy with the way the property is being managed.

“Generally they won’t be induced to stay with promises of change or improvements.

“The longer you can keep one good tenant in the unit, the better your return. You have to take into account the costs of advertising for new tenants, maintaining t he property while it is standing empty or keeping an eye on it securitywise and the loss of income during the time the unit is vacant. The time it takes to advertise and vet prospective tenants also needs to be taken into account, if you are doing it yourself. If your time is worth, say, R400 an hour and it takes you an hour to meet with a new tenant, that is a loss from your personal income,” he says.

Bauer offers a few guidelines for managing a rental property effectively:

Deal with repairs as soon as they are reported.

Check what maintenance needs to be done regularly, for i nstance wooden window frames might need to be treated or the fascia boards and exterior walls might need cleaning or painting, or large plants in the garden might have to be cut back.

Be willing to upgrade certain aspects of the unit from time to time. For example, tenants might ask for geyser timer switches or upgraded stoves, which are not that costly but will add to their enjoyment of the unit.

The management of a tenant starts, however, with the completion of a rental application and not only when the lease is signed, says Bauer.

Landlords must thoroughly check the references supplied, applicants’ employment history and their credit records.

Lease agreements must clearly state the date rent payments are due, where they must be paid and what the penalties will be if the rent is late. Occasionally tenants who have been reliable and in good standing also fall on hard times, and in these cases it sometimes pays landlords to try and establish workable plans for both parties rather than evict the tenants.

Chances are that once previously reliable tenants are again financially stable, they will resume good payment habits.

Remember too, says Bauer, that if the rental unit is in a complex, the body corporate or Homeowners Association rules must be given to tenants before they sign a lease. Possible problems that can be prevented include keeping pets they didn’t know they were not allowed to have. “As in any business arrangement, fair enforcement of rules and regular communication will keep relationships on a sound footing,” says Bauer.