Ponsonby Property Management LtdMonica ChenOptimising Property Investment Performance
75 steps or tasks with approximately 16 different processes Property management process What is Property Management?
A system designed to maximise your financial return and minimise exposure to risks +
Two key strategies to maximize rental income through property management
Basic rules defined by the RTA 1.For periodic tenancies the landlord must give the tenant at least 60 days’ written notice to increase the rent, in addition to a period allowed to correctly serve the notice. 2.There is no limit to how much a landlord may increase the rent, as long as the rent is not increased excessively above market rate. 3.For periodic tenancies, the rent cannot be increased within 180 days of the beginning of the tenancy, nor within 180 days of the last rent increase 4.Rent can only be increased for fixed-term tenancies where provision for this is written into the tenancy agreement.
What is the best practice, how often should you review your rent? And how much to increase it by?
Review doesn’t equal increaseIn our agency we review every 3 to 4 months or 3 months prior to the fixed term expiry date.
Key considerations • You must review regularly • Be confident that the new rent you are asking for is the rent in the current market condition • 3. Be reasonable • 4. Regular increases but at small increments
Benefits of fixed term tenancies-Minimise vacancy rate-Immunity against seasonal rental fluctuation -Provide certainty to both parties
Rules about fixed terms They automatically become periodic tenancies on expiry of the fixed term unless either party gives the other party written notice of their intention not to continue with the tenancy. This notice can be given by either party between 21 and 90 days before the date the tenancy expires. Expiry 90 Days 21 Days
2. Manage fixed term break effectivelyCan’t advertise at a higher rent without releasing the tenant from current fixed term.
3. Align fixed term renewal date with your rent increase- Less confusion for the tenant with fewer and tidier transitions for tenants- Easier to obtain co-operation from tenants- Position of power for rent increases
- Tenant Betty is currently renting 12 Lincoln Ave for $700 per week - Her 12 month fixed term tenancy is due to expire on the 20th of January 2013 - 90 days before the expiry date, Landlord Steve offers Betty another 12 month fixed term tenancy starting on the 21st of January 2013 at $725 per week. 90 Days -Confirm in writing -Terminate -Negotiate -Accept 21 Days Expiry
Proactive Property Management -Current knowledge of legislation -Property management best practices -Clear communication -Negotiation skills with an ideal outcome in mind