Responsibilities of the landlord
In order to maintain the value of your investment and to assist the tenant in keeping up the initial standard we recommend the following:
- The property be professionally cleaned prior to first letting the property.
- A thorough garden clean up is also recommended.
- The gutters should be cleaned prior to letting the property and then annually.
- Trees and large shrubs should be pruned.
- Keys to all door and window locks be supplied.
- All appliances should be in working order and instructions manuals should be supplied where possible.
- It is also the responsibility of the landlord to ensure the property complies with applicable health/building & safety regulations.
Tenant application & selection
Klemich Property Management has a stringent process of tenant selection to ensure the risk to your property is minimised. Our tenant application form is very detailed and all prospective tenants must satisfy a number of criteria prior to their application being processed.
Once we have verified all the information supplied, we refer the application to you for approval.
The preparation of all documentation required by the Residential Tenancies Act at the commencement and throughout the tenancy is completed by our office on your behalf. We ensure the lease is completed correctly in accordance with your instructions, so long as the instructions are not outside the Act. We also use a separate annexure to ensure all bases of the tenant’s responsibilities are covered. A bond equivalent to 4 week’s rental if rent is under $250 per week or 6 week’s rent if rent is over $251 per week will be taken and lodged with the Residential Tenancies Authority for the duration of the lease.
We will complete a thorough ingoing condition report of your property detailing every aspect to ensure that the tenant can be held accountable for any change in the property condition upon vacating.
Lease renewals & rent reviews
Approximately 8 weeks prior to the expiry of your tenant’s fixed term lease we will contact you to obtain your instructions regarding renewing or finalising the lease. We will advise you if we believe a rent review is warranted and will prepare renewal documents according to your instructions.
A continuing tenancy at a fair market rental will achieve a better return for an investor than a series of tenants at the highest rental obtainable.
If a fixed term lease is not renewed for a further fixed term then it becomes a periodic tenancy. This means that the lease carries on indefinitely until notice is given by either party to terminate the agreement. The tenant is required to give 21 days notice in writing and the owner needs to give 60-90 days notice depending on the grounds of termination.
All rent monies from tenants is to be paid in advance in accordance with the lease. Klemich Property Management is a cashless office and we encourage our tenants to use BPay as their rent payment method.
Regardless of the care taken, occasionally tenants fall into arrears. Once a tenant is 4 or more days in arrears we send them a text message reminder. Another warning message is sent if the tenant remains in arrears after around 8-9 days. If the tenant becomes more than 14 days in arrears then a breach notice is sent to the tenant. Failure to remedy the breach may result in termination of the lease. We will advise you if an application to the Tenancy Tribunal is required to enforce the termination.
All other breaches are dealt with promptly and without delay. If a tenant breaks any clause in the lease a letter is sent to advise them how to correct the breach. If the breach is not corrected in the advised timeframe then a termination notice is sent to the tenant.
Who pays for water?
A landlord may by agreement, pass any part or the whole of the charges for the supply of water to the tenant (including the water supply charge).
A landlord may nominate to be responsible for the charges for a certain (agreed) amount of kilolitres per year and the tenant is responsible for the rest. The agreement could also state that the tenant or landlord is responsible for all the water usage and/or the quarterly supply charge.
Note: Sewerage charges and the River Murray levy are always the responsibility of the landlord. The landlord is required to pay the SA Water account in full then we will calculate the tenant’s portion of usage and/or supply charge and invoice them accordingly. You will see on your statement once the tenant has paid the invoice.
We generally recommend giving the tenant an annual allowance to encourage them to keep the garden/lawns watered.
Tenants breaking their lease
If your tenant is on a fixed term lease and wishes to vacate (eg, being relocated for work, separating from partner etc) they must give written notice of their intention to do so. The tenant remains responsible for paying rent and outgoings plus maintaining the property until their lease expires or a new tenant moves in, whichever occurs first. The landlord will be charged a letting fee plus advertising if applicable however the vacating tenant will then be charged a portion of these fees (calculated on a pro-rata basis as per the RTA formula) to be reimbursed back to you.
Repairs & maintenance
To ensure you receive the maximum return on your investment, it is essential that repairs and maintenance are completed as cost effectively as possible. So whether you provide us with a limit of expenditure on your behalf, or you wish to be contacted before any maintenance is ordered, we will follow your instruction as detailed in our management agreement, as well as required by the Residential Tenancy ACT.
It is imperative that all repairs and maintenance be acted upon promptly to prevent situations worsening. In some cases, certain repairs can be classified as ‘urgent’ by the Office of Consumer & Business Services and as such a tenant is authorised to organise a tradesperson to attend and bill the landlord. Failure to carry out a repair at your property may leave you liable should the tenant injure themselves.
Klemich Property Management has a large number of qualified and insured local tradespeople capable of repairing and maintaining items around your property. As we are able to assign a large number of works to these tradespeople, they are able to keep their costs comparatively lower for our landlords.
Alternatively, if you wish to organise your own tradespeople attend to maintenance yourself we are only too happy to arrange this with the tenant.
On handing the property over to new tenants, we are required to supply them with 1 full set of keys for every lock on the property including window locks.
Our office will retain a full set of keys to facilitate inspections and to ensure that master keys are kept safe.
If your property has a security alarm installed you must either provide a working code for the tenant to use or have the alarm decommissioned and removed from the property. Maintenance of the alarm is at the landlord expense. If the tenant wishes to have the alarm monitored they can arrange this at their own expense.
You are required by law to install and maintain a compliant smoke alarm. If you do not do this you can be fined up to $750. The type of smoke alarm you need depends on when you first bought or built the property.
It is important that smoke alarms are correctly installed in an appropriate location to provide occupants with reasonable warning when they are asleep. It may be necessary to install more than one smoke alarm depending on the layout of the property.
The most efficient way to manage this requirement is to allow Klemich Property Management to organise a suitable contractor to carry out this maintenance annually on your behalf and issue a certificate of compliance.
If the property has a swimming pool there are certain legal requirements you must comply with to ensure the safety of the tenants. As the property owner you must ensure that these requirements are met and that the pool and its barriers are correctly maintained.
The law requires a continuous safety barrier that restricts access by young children to the pool and its surrounding area. Regulations apply to the fence, gates and any doors or windows that provide access to the pool.
If you would like to have an inspection carried out to ensure that the pool complies with the regulations you can contact your local council.
Pests and vermin
Below is a guide to who is responsible if an infestation occurs. It may change depending on the individual situation.
Pest and vermin The landlord is responsible: The tenant is responsible: Ants if present at the start of the tenancy if present during the tenancy Bees and wasps if present in a wall cavity or similar if present at the start of the tenancy if present during the tenancy Birds to remove and seal off any entry points Cockroaches, fleas and spiders if present at the start of the tenancy if present during the tenancy Mice and rats if present at the start of the tenancy if present during the tenancy Possums to remove and seal off any entry points Snakes if present at the start of the tenancy if caused by the landlord breaching the conditions of the agreement – eg landlord left piles of rubbish in garden if present during the tenancy White ants at the start and throughout the tenancy
The removal of European wasps is managed by your local council.
As a landlord you are obliged to provide the rental property to the tenant in a reasonable state of cleanliness and repair at the start of the tenancy. The property must meet all legal requirements affecting the property – eg building regulations.
You must maintain the property, including all of its fittings eg appliances, to a reasonable standard throughout the tenancy. What constitutes a reasonable standard will depend on the property’s age, character and prospective life. Even if the tenant was aware of maintenance issues at the start of their tenancy you will still be required to carry out repairs and maintenance.
It is a requirement of the management agreement for all landlords to have building insurance which also includes liability or legal risk providing cover with a minimum of $10 million. The insurance company must be notified that the property is a rental, so therefore needs contents cover for inclusions e.g. curtains, carpet etc.
Landlord protection insurance
There are a number of companies who provide Landlord Protection Insurance. Your current building insurer will be able to provide you with a quote for this important cover however we recommend Terri Scheer Landlord’s Insurance. If you do not have appropriate Landlord’s Insurance for your investment property we highly recommend you consider this invaluable protection against risks standard building insurance may not cover – including accidental and malicious damage caused by tenants and loss of rental income. Please advise us if you would like this cover arranged on your behalf.
Newly constructed properties
If you require assistance in organising finishing touches for your new property such as window treatments, clothesline, TV antenna etc which may not be included in your building contract we are happy to assist.
The telephone lines to your investment property will be laid into the trenches during the building process however the connection into the property is not made until the first occupant organises a phone connection. Once this has been done, the first resident will be invoiced this additional connection fee of $299. This however is an owner cost which will need to be reimbursed to the tenant. Please note this is a one off cost.
Routine inspections are carried out every four months allowing us to regularly report on the condition of your property. With the use of Ipads, we have been able to streamline the reporting 5 process and email you the reports for your records. We will advise you of any maintenance items that require attention as well as letting you know the general manner in which the property is being maintained by the tenant.
Please let us know in advance if you would like to accompany us on an inspection as we are required to give the tenant adequate notice.
Monthly disbursements & payments
Landlord payments are processed on the final business day of the month with funds usually appearing in your nominated bank account on the following day. You will be provided with a detailed statement outlining any rent collected, authorised expenditure and management fees. We also send you copies of any invoices we have paid on your behalf. Please read your statement carefully and let us know if there is anything you don’t understand or if there appears to be any mistakes.
EOY financial statement
You will be emailed a report summarising all income & expenditure for the past financial year. We will email this report to the same email address that your monthly statement is sent to.
By ticking the applicable boxes in Item 10 of the Management Agreement, you are authorising us to pay accounts on your behalf. To do this we require your account numbers eg Council rates notice, Revenue SA ownership number, SA Water account number, Strata Corporation etc. We will contact the appropriate authorities and request all accounts/invoices be sent to our office for payment. We will then pay the accounts using funds held in your trust ledger.
There may be occasions that we are not holding enough funds to cover the payment before the due date, in which case we will contact you to forward extra funds to us to cover these payments. If a tenant pays a large amount of rent in advance, we may hold over some of these funds to cover upcoming maintenance or future outgoings.
We are happy to arrange a free, no obligation appraisal with one of our sales people from our award winning team.