A Move In The Right Direction

Michaela

We hired Michaela in January of this year as our receptionist. Initially she was quiet but as she keeps settling in she is becoming as loud and ‘well humoured’ as everyone else (In our office the term ‘well humoured’ means hassling me back and sometimes winning). Michaela’s phone manner is great and she is dealing with more and more of the tricky phone calls we get from tenants. She is a great member of our team and we really appreciate her.

Shayne Thurston
Lambton Property Management

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I was reading the blog of a good friend one - ok one of my very bestest buds, even though she thinks Northern England is great… no one is perfect :)…. ANYWAY back to the topic…. She has written a simply fantastic blog on the 50 reasons to be sensible which I though I would share.

“… the Dom Post came out yesterday with their ‘50 tips to ride out a recession and still have a life’. Now here, interestingly enough - discussing interest rates with your bank was all the way down at 46 while watching what you spend came in at number 11 - both of which are going to have a bigger impact on cash flow than anything else such as;

You can read the rest of this if you go to her blog www.avalonsguide.com/anab

Shayne Thurston
Lambton Property Management

Other Blogs, Shayne's blog, Thoughts and Opinions

While I sit here tonight, enjoying a glass of wine, I find myself thinking over the events of the day. We had a tenant come in today, who had rented a fully furnished place. Unbeknown to us, the owner had in the last month removed the TV, and changed the fridge to a smaller one. While I knew I was really annoyed, I was not even close to being as annoyed as the tenant was.

By the end of the hour and a half long three way conversation between the tenant, myself and the owner, we had a resolution sorted. The owner would ensure that these items were replaced within two days, the tenant would get reduced rent for a month and we would not sack the owner (I know our sacking them sounds harsh, but they had put us in what could have easily become an untenable position if the tenant had not been prepared to be accommodating). The entire situation basically occurred because we were not consulted and were kept out of the loop and while yes the owner does actually own those things, if the place is rented with them there, you cant simply just remove them.

This made me think about whats fair. Its not fair in my opinion, when you have some paying $580 per week for a furnished apartment to turn up and take things out. Its just not fair.

When it comes to the tenancy tribunal, the adjudicators look heavily at whats fair.  This is a crucial thing to bear in mind. Be careful and fair, or if it gets to the tribunal even if you are in the right you may lose. I know that for a while another government department used the  “Its our job to be fair”, but tenancy adjudicators really have that sown up. They look at what is fair - based on the tenancy act. They will often decide in the ‘merits’ of fairness that they will decide which aspects of the act to enforce and at what speed.

Shayne Thurston
Lambton Property Management

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The Department of Building and Housing has written an interesting article (no I am being serious). Its helpful and slightly on the side of the landlord. http://www.dbh.govt.nz/landlord-enewsletter-article-9-1
One of the ongoing debates with tenants is the issue of mould. Unless we are convinced something related to the property has caused the mould we tend to be quite aggressive about getting them to clean it off (or getting it cleaned and billing them).

“A tenant’s sense of clean and tidy conditions could be different from the landlord’s. Particular behaviors of the tenant may create excessive mould, damp or insect activity. ” Fantastic line. The article does go into things that as a landlord one should do to minimise the conditions that lead to mould, however it does admit that yes tenants can actually be responsible for it.

Shayne Thurston
Lambton Property Management

Shayne's blog, Thoughts and Opinions

Insurance is normally a hot topic around our office. We often encounter situations where our clients insurance companies are playing hard ball or doing their level best to be difficult (ok ok so sometimes we are really surprised and really happy when an insurance company is really helpful - and when it does happen I tell everyone).

Just having insurance is not good enough - you need to have the RIGHT level of insurance. No ifs, no buts, no maybes, you just have to. Questions I ask for our places (and sometimes get uptight and argumentative of when I dont get the answer I want) are:
1: Does it cover damage by the tenants or people known to them?
2: Does it cover gradual damage or a slow leak - increasingly hard to get as many companies use the soft option of saying “tenants just wont tell you” - the repsonse is “If its a slow leak they wont notice!”
3: Is there sufficent liability cover in there just in case you get sued? (Yes it does happen - not to anyone I know (touchwood) but it happens) - for example if your tenant falls through your deck, or off your deck, that sort of thing.
4: Are there any “if the property is tenanted” exclusions? I know this sounds stupid, but all to often I read through apparent landlord polices to see “Section1:C is not covered if the property is tenanted”.

Also I want to know, exactly what their complaints procedure is and what is their timeline for handling complaints? (Not that I start of expecting the worst when I make a claim or anything…. Though this does mean I am not normally disappointed).

Thats my immediate five second thought on insurance for the night.

Shayne Thurston
Lambton Property Management

Shayne's blog, Thoughts and Opinions

We currently get to see a good number of people under all sorts of financial stress. Whether it be tenants finding things tight as one of them has their hours reduced or made redundant or whether it be landlords worried about spending that money on maintenance, or worrying about whether they could handle things if their tenant lost their job.

The thing about this is that no one is alone in this. What makes the difference is how you react and how you treat the people around you. While most people understand that ‘hey you are not the bad guy or the cause of their problems’ others are not. Some attack instead of asking how they can help, or if you can help them, others just close their eyes and hope it will go away.

What I would really like is if people simply took a moment to think “Hey how would I feel if someone acted that way to me?” before they began anything. Then ask themselves if after they have thought about that is the action justified? I believe it would things much more pleasant for people and I suspect they would find people much more willing to help them.

I do have bad days myself where I feel like “This recession sucks, mumble mumble” but then I draw inspiration from those around me – from my Pam who always seems able to turn off her stress at a moment’s notice, to good friends of mine like Steve, who’s catch phrase of “whatcha gonna do” just makes me smile every time. I think the key to handling the down days in these times, and we all do have them, is to realise you are just having a blah moment and then to look at how your friends and other people you respect are handling things that day (You’ll find that your blah moments don’t tend to sync with theirs) and grab your little bit of inspiration and just simply get on with it for the day.

I know some of this sound a little hippy like and yet some of it sounds a little ‘un pc’ but its my way of doing things and it works for me.

Shayne Thurston

Lambton Property Management

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Its been an interesting month for renting places out. Winter as descended and made Wellington feel like its right next to the pole (ok that may be an exaggeration, but I couldn’t find my gloves the other day and I just felt like a wimp) ,the budget was due in a couple of weeks and government departments were making people redundant. The mood amongst many prospective tenants was pensive and they seemed focused on what they could afford on one salary. 

The rain and cold always mean a lower turnout to showings, and the last few weeks have been no exception.. I read an article recently in which the author said she thinks tenants must be made of sugar and this cannot go out in the rain - it made me laugh and cry at the same time.

However, as per every year (and thankfully this year has been no exception) Queens birthday weekend was reasonably quiet, however the week following (as it was this year), enquiries start to pick up:) Today we rented three places which is great and I look forward to renting the rest.

Shayne Thurston
Lambton Property Management

Shayne's blog, Thoughts and Opinions

Last week, I agreed to bite the bullet and hire a full time admin assistant. With tenants being tardier with their rent payments in the current environment and the work required to chase them up, Pam was losing most of her day to this crucial yet time consuming job.

So we placed an ad on Trademe jobs. The ad pulled no punches and we offered only average pay for the position and yet in 28 hours we had received 56 applications. It was a little over whelming.

The depressing thing reading through them was that every third one seemed to mention they had recently been made redundant. It was a little of a reality check. While I might be grumbling about having to spend more money to get the same money in, we are in the position where we can hire someone – which is a lot better than a lot of people.

Shayne Thurston

Lambton Property Management

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I read an interesting article in the paper today which stated that currently it was cheaper to buy than to rent. How nice J 

The realities are, in my opinion, that yes while you can buy properties and service mortgages much cheaper than you could last year, you cannot necessarily buy where you want to live.  And believe me, living in the preferred location seems to be more important to people I talk to than their ability to afford it.  Now the only place in Wellington I can see it being cheaper to buy than to rent is the central suburbs.  In the outer suburbs, it would be hard to buy something where the rent on current purchase prices even came close to the mortgage amount.  (Though admittedly if there’s one man who could find the place where this would work would be Steve Goodey www.ventureproperty.co.nz.  (Don’t ask me how he finds the deals, he just does).  However, I don’t believe what the article stated works in the central suburbs as a general rule either.

Say for example we have chap called Bob who wants to live in the city.  Bob can rent a one bedroom apartment for between $370 to $420 per week or $19,240 to $21,840 per year.  Now Bob can buy this apartment for $300,000 dollars with 20% down so Bob has a mortgage of $260,000.  At the current National Bank floating rate of 6.45%, Bob’s repayments are $16,770 per year – seems cheaper right?  Not really, take into account Bob’s rates of say $1700 per year, his bodycorp fees of about $3500 per year and Bob is already spending more than what he would if he was renting.  Then we add in some money for maintenance, and hey presto, it’s cheaper to rent by several thousand dollars per year.

It also says in this article that house prices will fall further.  I wait to see if this is indeed the case.  But even if they do, how long before they are higher than they were last year?  How long will the low interest rates last?  Banks have already raised their five year rates and I can only believe this will continue.  The banks have to try to gauge what their cost of borrowing over the next five years will be, and as far as I can tell, they expect it go up, up, up.  Which means so do the mortgage rates.

I do not believe that there will be a rush of tenants buying properties, and thus creating a glut of empty rental properties.  Most people, let alone your tenants, do not have fifty to eighty thousand dollars just lying around in the bank, so meeting the 20% deposit mark is not all that easy.  They also have to find the place they want to live in, and having been through this exercise a year ago, it’s not an easy thing!

Shayne Thurston

Lambton Property Management

Shayne's blog, Thoughts and Opinions