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  • Always get the cash

    I have been helping a friend out with locating a tenant for a 3 brm flat in Mt Roskill. This has been advertised on Trademe and a To Let sign for the last week. The response had been good and I had been able to get four applications signed up @ $400 pwk rent.

    I offered the best applicant the tenancy on Tuesday morning and met him to sign up and hand over rent-bond on Tuesday evening. All was well although the individual was fairly persistent with wanting the tenancy to start on Friday 6th July rather than this Friday. He finally agreed to sign the tenancy yesterday with rent starting Friday 29th June. I received $1600.00 cash (16 red ones) being three weeks bond and one weeks rent in advance....so I was happy.

    However, on turning on my cellphone this morning there is one message from the new tenant. A summary of the message left on my phone is as follows:-

    1. He is not comfortable with the start dates of the tenancy
    2. He is happy to terminate the contract
    3. He is unhappy with the deal
    4. He thinks the contract is unfair

    Well, this individual looked promising as a tenant - career in banking as an analyst and now as credit controller. His wife works from home as an editor! Because of his background I was especially annoyed that he had signed this contract and 12 hours later wanted to terminate. Of course, he wanted to terminate and receive a $1600.00 refund. I got him to phone Tenancy Services and to his surprise he was told that he would be forfeiting $1200.00 (3weeks notice).

    I emailed the tenant a standard notice to vacate form and advised him that the owner and I would prefer that he vacates.
    After a number of telephone discussions throughout the day he decided to maintain the tenancy.

    We will see how this tenancy progresses, tenant is well spoken with good presentation....came across as reasonably together. Not sure about strength of character now, after todays communications.

    The above is a good reminder to always insist on a cash payment at the beginning of a tenancy, this individual would have definately cancelled a cheque this morning.

  • #2
    Totally agree no money no tenancy. No money no keys.

    Comment


    • #3
      Why the insistence on your part for the tenancy to start on the 29th June- especially when only signed up on Tuesday (26th June?)? Could you not concede to start 6th July & not pressured them to start their tenancy so early? Sounds to me that this was his issue & his strength of character may have been eroded by being harangued into a commencement date earlier than reasonable.
      For the right tenant i expect that i have to allow 3 weeks for the tenancy start while they give notice to their current landlord.
      But- yes you are so right in getting it all signed up with cash.

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      • #4
        Sounds to me like he has changed his mind. Tough Sh#t for him really.
        Need a website or anything to do with online marketing? Visit Christchurch Web Design.

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        • #5
          Yeah I kept $1200 from a signed up tenant last year. I'm a softie and felt a bit awkward, but then you look at the mortgage payments and an empty flat with no rent, and the decision is easy. It all went quiet when I showed his lawyer a copy of the signed rental agreement.
          The tenant still walked but it gave me three weeks to find a new one.

          Comment


          • #6
            Cassandra wrote:
            Why the insistence on your part for the tenancy to start on the 29th June- especially when only signed up on Tuesday (26th June?)?
            Why wouldnt you insist the tenancy start as soon as the property is available? If the start date doesnt suit the successful applicant they shouldnt sign the agreement.

            Cassandra wrote:
            Could you not concede to start 6th July & not pressured them to start their tenancy so early?
            Where's all the pressure coming from? Tenant signed an application, met me to sign the tenancy agreement and paid $1600.00 cash.

            Cassandra wrote:
            Sounds to me that this was his issue & his strength of character may have been eroded by being harangued into a commencement date earlier than reasonable.
            His issues are identified in points 1 to 4 in my original post! The reasonable start date is set by the property owner ie when the property is available. I achieve a zero vacancy , wouldnt that be good for an investors cashflow?

            Cassandra wrote:
            For the right tenant i expect that i have to allow 3 weeks for the tenancy start while they give notice to their current landlord.
            Why do you expect that? For a well presented property you'll find there will be a queue of good applicants ready to start the tenancy right now. However, applicants are unlikely to open their mouths if I suggest that the tenancy starts in 3 or 4 weeks??

            Cassandra, its a business at the end of the day!

            Comment


            • #7
              Had to ask. I actually achieve zero vacancy rates without playing hard-ball in this manner- but at the end of the day its your call how you operate your business & if you have 4 applicants to choose from its the ones that will "put thier $ where thier mouths are" & sign up as commited tenants on your terms if they really want the property.
              Last edited by Cassandra; 28-06-2007, 10:50 AM.

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              • #8
                The only time I would actually consider letting the place stay vacant for a week or so is if there was a lot of maintenance to do, such as painting and carpeting throughout. In that case it might be cost effective to forego a week's rent so as to do a good reno job. However, I do let my guard down and give up rent because I am too nice at times.

                Sometimes if a tenant wants a property they will willingly pay that extra week's rent just to hold the place while they are working off the notice on their earlier place.

                xris

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                • #9
                  The only time I would actually consider letting the place stay vacant for a week or so is if there was a lot of maintenance to do, such as painting and carpeting throughout.
                  Yeah, my comments on vacancy exclude maintenance/renovation periods...if I'm doing a total gut out the property will be empty for 3 - 4weeks, typically.

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                  • #10
                    Originally posted by xris View Post
                    because I am too nice at times.


                    xris

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                    • #11
                      Just kidding xris...........you left yourself open for that one!

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                      • #12
                        Hi folks I am back after travelling in China and Vietnam.
                        It sure is tough coming back to the cold hearted real world. Your mind just has to be on the ball all the time doing our type of work.
                        Just this week one of the prospects that had been located and chosen in my absence made an appointment to pay and sign. They even asked who they should make the cheque out to. Now this nice sounding couple had to come all the way into town from Richmond to do the deal. We met and exchanged pleasantries. Have you got the money I say unfolding the tenancy agreement to fill in and sign. Oh, young sweetie says. There has been a problem with the cheque clearing and I will not be able to pay you till next week. That will not be a problem will it she purred.
                        Not a problem at all I said sweetly closing the tenancy agreement folder.
                        No money, no tenancy.
                        Good bye.

                        Comment


                        • #13
                          Anyone got some good ideas on doing credit checks on tenants?

                          We have used a casual letting service in the passed and now have an applicant applying direct. I went to www.vedaadvantage.co.nz (via BayCorp) and their fees are for $195 per year, just wondered what everyone else does. Building the portfolio fast but not at big numbers at the present. Tried the tenancy services site but link wouldn't go through. Ideas welcome.

                          Comment


                          • #14
                            Hi McJet
                            I went to www.vedaadvantage.co.nz (via BayCorp) and their fees are for $195 per year, just wondered what everyone else does.
                            Veda Advantage will waive the $195.00 if you are member of your local property investors association. Your cost then would only be ~$5 per credit check.

                            Comment


                            • #15
                              Originally posted by McJet View Post
                              Anyone got some good ideas on doing credit checks on tenants?

                              We have used a casual letting service in the passed and now have an applicant applying direct. I went to www.vedaadvantage.co.nz (via BayCorp) and their fees are for $195 per year, just wondered what everyone else does. Building the portfolio fast but not at big numbers at the present. Tried the tenancy services site but link wouldn't go through. Ideas welcome.
                              We are happy to sign you up as a member of Nelson. You do not need to live here. For the low fee of $140 you get the $195 discount plus two good magazines plus other good advantages.
                              You are right to want to do credit checks. Not doing them is like flying with the cockpit windows blacked out. You are bound to hit a bump or two along the way, it might hurt you in the pocket real bad.

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