When a Tenant wants to break a lease early?
If my tenant wants to break my lease agreement early for relocation of work, what should I do? Some say if they are a good tenant let them go without any hassle. What should you do?
With all the background checking we do it is important to understand as much about our applicants, knowing if they left a tenancy early would be something a landlord would want to know. A tenancy agreement is a contract between two parties, the Landlord and the Tenant. Allowing the tenant to leave without following the terms of the contract isn’t helping other landlords. If you were checking this tenants reference, would you like to know, they left a tenancy before the fixed term ended? Would that make a difference for you considering renting to them?
In BC a fixed term requires both parties to agree to be part of the tenancy until the end of the term. This means the landlord has no right, without cause to evict the tenant before the end of the fixed term, it also means the tenant agrees to rent the property through the end of the fixed term. If the landlord wants to end the tenancy before the fixed term it requires the tenant’s permission and possibly compensation. If a tenant wants to end the agreement early they could be held responsible for rent during the time the unit is vacant and unrented. They can also be required to pay liquidated damages for costs incurred due to them vacating the property early. As a property manager we charge clients a leasing fee to find tenants, and this is a cost a tenant could be required to pay in a liquidated damages clause. It is important to have these additional clauses in the agreement and explain them to the tenant before they move into the property.
It is important to know even though a tenant vacates the property during the fixed term, a Landlord has a responsibility to mitigate their loss which means they must do everything to find a new tenant. If they find a tenant to rent the property immediately following the tenant leaving, the previous tenant would not be responsible for rent moving forward as the Landlord has not experienced a loss. The tenant could still be held responsible for the liquidated damages clause in the tenancy agreement. It is important for Landlords to enforce the agreement and for tenants to understand they are required to adhere to all the terms of the tenancy agreement.
Need assistance managing your rental property, Cartref Properties can assist you, call today to discuss your needs. You can find more information about us at: www.cartrefproperties.com
Unit inspections during a tenancy
Recently I was communicating with a person who was criticising a property manager for the poor work they were doing. They indicated the property manager hadn’t inspected the rental property in the many years they were managing the property, and there were a number of issues with the property.
Cartref Properties includes two inspections with each property within a twelve month period. We find this helps us manage the tenants and the property more effectively. When we discuss this with potential clients they often fail to see the importance of inspecting the unit while it is tenanted and request a reduced cost of management in exchange for no inspections. Cartref Properties won’t manage a property unless we are able to perform inspections every six months. We find there is a significant increase to the landlord having a positive experience when regular inspections are performed.
When tenants are applying and viewing the unit for rent we are open with all potential tenants regarding the inspections and their frequency. We find this increases the quality of tenants applying and reduces the possibility of selecting a poor tenant. Tenants who are okay with the regular inspections have proven to be better quality tenants. We even tell the applicants the reasons for the inspections, which includes ensuring they are doing nothing illegal, investigating if the unit needs repairs before they become out of control and ensuring the people on the tenancy agreement are the only ones residing at the unit. Our tenancy agreement has 38 addendum clauses, many of which we are unable to confirm by the tenant paying rent. We have found again explaining these issues to potential applicants doesn’t scare quality people from applying for the rental unit. We have also found performing the inspections creates better communication with the tenants.
Many landlords and property managers think or believe property management is simple, easy and doesn't require much effort. Finding the tenant is the beginning of the process of owning and or managing a rental property. It is equally important to know what is happening at the property during the tenancy, and this can only be done by visiting the unit regularly. If you hire a property manager, request they perform at least two inspections annually and provide you with a report of their findings. Some insurance providers are demanding this and even more frequent inspections to keep the insurance valid.
Need assistance managing your rental property, Cartref Properties can assist you, call today to discuss your needs. You can find more information about us at: www.cartrefproperties.com
Rental Management only
Cartref Properties provides rental management services only. In BC a real Estate brokerage is able to provide three different types of services, Rental Management, Strata Management and Real Estate Sales. In order to provide these services the brokerage must be licensed to provide whichever service they are offering. We only offer rental management service even though we are licensed for strata management services, why? There is a natural conflict of interest between the three categories, especially with rental and Strata Manager. If a company manages the entire strata and then manages a rental in that same building, they are required to identify one of the clients as the primary client. This means if there is a conflict of interest between the two parties they are only able to represent one party. This would happen when a bylaw infraction occurs. In all cases a management company will select the stata client as the primary and the rental client as the secondary. The real Estate council in BC highly recommends companies who manage a strata corporation don’t manage rental units in the same building. We also have no interest in providing sales service for the same issue. We don’t want to be the real estate agent who is looking for a listing in a hot market and asking you to sell when you’re not interested in selling. Cartref Properties wants to be able to provide property management services to our clients throughout the entire time we are engaged as your property manager, which is why we only provide rental property management services.
Need assistance managing your rental property, Cartref Properties can assist you, call today to discuss your needs. You can find more information about us at: www.cartrefproperties.com
What is the cost of hiring a property Manager?
As a property manager I am often asked why would I hire you when I can do this myself.
It’s a good question. You could argue there are many things in today’s society that have become easier for everyone due to technology. I would argue in the past we did more things ourselves before utilising a paid service.
Growing up my parents’ idea of detailing their car was making me wash and clean the car. Kids would buy old cars and fix them up. Repair the body, change the oil, spark plugs and many other car repairs. Now that is a lost art, due to technology and the cars being more complicated. In today’s world of technology all services are being marketed as easy to perform.
When you are hiring anyone performing a service for you, you are hiring them for the expertise they provide, not just the tasks they perform. When hiring a property manager you are asking them to perform tasks which when done correctly are very time consuming. Renting your property and selecting a tenant can be a very exhaustive process, and if you are working full time and trying to manage your property on the side, are you performing the required tasks with the full attention it needs?.
When I hear and read stories of a negative tenancy experience, there are often telling signs of missing basic tasks or efforts to properly screen or search for a tenant. Common traits of poor tenant selection include, “they appeared to be very nice people”, “I thought the number they provided was the landlords”, “ the information they provided was fake”.
All of the above are things that are easily missed if you don’t read between the lines, and some basic ideas can help you understand these issues better. When I hear someone say that they appeared to be nice, I cringe. Remember that saying “never judge a book by it’s cover” It works both ways, people may look good on first impressions, but don't let that cloud your judgement on the information they provide. You still must check out all the details.
How do you confirm the number provided belongs to the landlord?. This is a bit easier than you think in today’s world due to technology. What is that phrase, “don’t believe everything you read”. Before making the phone call, do some research online to verify the address of the property, try to look up the phone number. The internet gives you a look at the neighbourhood of the house and things around it. When speaking to the landlord, ask them to confirm the address by purposely giving them the wrong street number of the address, or describe things in the area. This will sometimes trip up a person who was asked to lie for someone as they might not remember the correct address. A real landlord of the property will know the correct address.
I have heard some landlords have allowed tenants to provide a credit check they provide with their application. You must assume any and all information a prospect provided may be inaccurate or fake. Even if they provide a credit check, perform your own credit check to verify the information.
Performing all the above tasks can be very time consuming and take many different calls to the numbers provided in the application. By hiring a property manager you are hiring an expert who can perform these tasks in a timely and effective manner. Property management is still a business which is people oriented. Relying entirely on technology to perform your due diligence will almost always result in a negative tenancy for the landlord. The cost of a negative tenancy often turns into a very expensive result for a Landlord, with unpaid rent, damage to the property and eviction costs. If you want a positive tenancy hire a property manager to help you through all the stages of managing a rental property. The cost of a property manager will be less than the negative tenancy.
If you need assistance managing your rental property, Cartref Properties can assist you, call today to discuss your needs. You can find more information about us at: www.cartrefproperties.com
Can I charge for new fobs and move-in fees?
In BC most of the rental housing in today’s market is located within Strata Corporations. There are some fees associated within a Strata Corporation that affect a landlord can pass to the tenant. Every Strata Corporation will have a move-in fee for when a new person occupies the unit. Some buildings have a move in and move out fee to be charged each time a person comes or goes. Another common charge in Strata Corporations are the fob or access devices. Almost all buildings have a keyless system and use a fob to access the building. The fobs have a cost to purchase which is much more than a standard key for the building.
Landlords often ask who pays for these costs. Section 7 of The Residential Tenancy Regulations outlines allowable non-refundable fees that a Landlord may charge a tenant. The cost of the move-in fees and the costs to replace or purchase additional access devices are costs a landlord may have the tenant pay for. A key part of section 7 often miss understood is that the allowable costs are the “direct cost” for the new fob or the move-in fee. What this means is if the Strata Corporation charges the landlords a move-in fee of $100 that is the amount you charge the tenant. When Cartref Properties rents a property we often have the tenant pay directly to the Strata Corporation the move-in fee. This shows the tenant we are not overcharging the fee, and the strata are able to collect the funds directly upon move-in. With regards to the access devices, often landlords try to make money by selling the fob for a price higher than they paid for the item. The strata charge to the owner is $80 for a new fob and the Landlord charges the tenant $100. This is not allowed as the $100 is not the direct cost for the fob. If the tenant finds out they overpaid they may have a valid case to file with RTB to be refunded the overpayment. If your building doesn’t have a fob system and uses keys the direct cost factor also applies. Cutting a key is very minimal compared to a key fob, yet the direct cost factor still applies.
There are other costs included in section 7 in which landlords are allowed to charge tenants for including returned cheque fees incurred by your financial institution, late rent payment fees, and fees for services or utilities which are not included in the tenancy agreement.
When being a Landlord it is important to know your rights and obligations.
If you need assistance managing your rental property, Cartref Properties can assist you, call today to discuss your needs. You can find more information about us at: www.cartrefproperties.com