Managing The Tenancy

Renting out your property privately in Australia can be a rewarding experience, but it requires effective tenancy management to ensure a smooth and legally compliant process. From screening tenants and setting up the lease agreement to handling rent payments, inspections, maintenance, and dispute resolution, you have various responsibilities to fulfil. This article provides a comprehensive guide to successfully managing a tenancy when renting privately.

Finding and Screening Tenants

Selecting the right tenant is crucial for maintaining a hassle-free rental experience. Without the assistance of a real estate agent, you need to take extra care when advertising, screening applicants, and checking references.

Advertising the Property

List your property on reputable rental websites, social media platforms, and community bulletin boards.
Highlight key features such as location, rental price, property size, and unique selling points.
Include high-quality photos and an engaging description to attract prospective tenants.
Clearly specify rental conditions, such as pet policies, lease duration, and furniture inclusions.

Screening Applicants

Request a completed rental application with employment and rental history details.
Conduct background and reference checks from previous landlords and employers.
Verify proof of income (e.g., payslips or bank statements) to ensure affordability.
Conduct a tenancy database check to identify applicants with a history of rental arrears or evictions.
Consider holding interviews to assess prospective tenants’ reliability and suitability.

Setting Up the Lease Agreement

A properly drafted lease agreement protects both you and your tenant by outlining rights, responsibilities, and terms of the tenancy.

Key Components of a Lease Agreement

Names and contact details of both parties.
Lease term (fixed-term or periodic tenancy).
Rent amount, due date, and payment method.
Bond details (usually equivalent to four weeks’ rent).
Maintenance and repair responsibilities.
Rules around subletting, pets, and property modifications.
Procedures for ending the lease and notice periods required.
Terms regarding inspections, access to the property, and tenant obligations.

Each Australian state and territory has specific legislation governing tenancy agreements. Make sure your lease complies with local tenancy laws and is legally binding.

Collecting Rent and Managing Finances

Establishing a clear process for rent collection is essential for financial stability and cash flow management.

Rent Collection Methods

Bank transfer: A secure and convenient method for tracking payments.
Direct debit: Ensures timely payments without requiring tenant action.
Rent collection platforms: Online tools that automate payments and issue receipts.
Cash or cheque: Less common but may be an option for some tenants.

Handling Late Payments

Send a polite rent reminder immediately after the due date.
If rent remains unpaid, issue a formal notice in accordance with state laws.
Offer a payment plan if the tenant is experiencing temporary financial hardship.
If non-payment continues, you may need to apply to a tenancy tribunal for eviction proceedings.

Conducting Routine Inspections

Regular inspections help you monitor the property’s condition and identify maintenance issues before they worsen.

Inspection Guidelines

Provide proper notice to tenants (state laws specify minimum notice periods).
Conduct inspections every 3 to 6 months to ensure compliance with lease terms.
Document the property’s condition with photos and written notes.
Address tenant concerns and discuss necessary repairs.
Check for any unauthorised modifications, subletting, or damage.
Ensure smoke alarms, safety devices, and fixtures remain in working order.

Handling Repairs and Maintenance

Timely maintenance ensures your property remains in good condition and compliant with legal requirements.

Your Responsibilities as a Landlord

Keep the property in a safe and habitable condition.
Arrange repairs for structural issues, electrical problems, and plumbing faults.
Respond promptly to urgent repair requests (e.g., gas leaks, burst pipes, broken hot water systems).
Ensure compliance with health and safety regulations, such as smoke alarm checks and pest control.
Budget for routine maintenance to prevent costly emergency repairs.

Tenant Responsibilities

Keep the property clean and report maintenance issues promptly.
Handle minor upkeep such as changing light bulbs and maintaining gardens.
Avoid causing damage beyond normal wear and tear.
Seek written permission before making alterations or renovations.

Urgent vs. Non-Urgent Repairs

Under Australian tenancy laws, urgent repairs must be addressed immediately. These include:

Gas leaks or electrical faults.
Burst pipes or severe water leaks.
Blocked or broken toilets (if only one is available).
Serious roof leaks or storm damage.
Any other issues posing health or safety risks.

If you fail to act on urgent repairs, your tenant may arrange for repairs themselves and seek reimbursement.

Resolving Disputes

Despite best efforts, disputes may arise over rent payments, repairs, bond refunds, or lease breaches.

Steps to Resolve Disputes

Direct Communication: Discuss the issue with the tenant and attempt to find a fair solution.
Mediation Services: State tenancy authorities offer free mediation to help resolve conflicts.
Tenancy Tribunal: If mediation fails, you or your tenant can apply to a tribunal for a legally binding resolution.

Common Rental Disputes and Solutions

Late Rent Payments: Offer a payment plan before pursuing legal action.
Property Damage: Document evidence and negotiate repair responsibilities.
Bond Deductions: Use clear records and inspection reports to justify claims.
Lease Breaches: Issue formal breach notices and follow legal procedures.

Ending a Tenancy

When a tenancy ends, proper procedures must be followed to avoid disputes and ensure a smooth transition.

Notice Periods

You must provide written notice in accordance with state laws (e.g., 60 days for no-fault terminations).
Tenants must also provide notice if they choose to vacate the property.
Shorter notice periods may apply in cases of lease breaches or eviction proceedings.

Conducting the Final Inspection

Compare the property’s condition to the initial entry report.
Note any damage beyond normal wear and tear.
Address outstanding rent or unpaid bills before finalising the tenancy.

Bond Refund Process

Lodge a bond refund request with the relevant state authority.
Deduct any repair costs for tenant-caused damage (excluding fair wear and tear).
Provide your tenant with an itemised list of deductions if applicable.
Refund the bond promptly to avoid disputes.

Protecting Your Investment

Successfully managing a tenancy when renting out your property privately in Australia requires diligence, organisation, and a strong understanding of tenancy laws.

Tips for Landlords

Keep detailed records of lease agreements, payments, and maintenance requests.
Stay informed about changes to rental laws and regulations.
Build good relationships with your tenants to encourage communication and cooperation.
Have landlord insurance to cover property damage and rental losses.
Consider professional property management services for additional support.

By carefully selecting tenants, maintaining your property, handling disputes professionally, and following legal procedures, you can create a positive rental experience while protecting your investment.