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I’m self-managing my own investment property. My tenant has just given me notice that he would like to terminate his lease and move into the property he has just bought. Like all tenants, he wants to get his bond back as soon as possible. Although he has been great, I don’t want to put myself at a disadvantage; I need to do a thorough inspection first before signing off. What is the standard procedure for returning a tenant’s rental bond and how soon am I expected to release it? Are there any inherent risks I should be aware of?
This is an interesting question, particularly as you have had a great tenant in your property. Often you can feel pressured to sacrifice some of your own security, as this person has treated both you and your property with respect. By ensuring a smooth and speedy but fair ‘check out’ process, everyone can come out a winner.
Firstly, speak to your tenant and arrange a mutually acceptable time to conduct the final inspection, as this should be done together, with the necessary paperwork in hand. Go through the property thoroughly to make sure there is no damage, no rubbish or anything that needs cleaning, etc. If your tenant wishes to challenge any of the areas you believe require attention, it’s a good idea to have the ‘check in’ paperwork handy too.
As landlord, you must notify and give the tenant a reasonable opportunity to be present at the final inspection. This means they are made fully aware of any areas you believe need attention and it offers them an opportunity to fix it on the spot, or arrange for the necessary work to be completed. It is important that you do not release your tenant’s bond until you are happy with the outcome of the property review and the subsequent reparations (if required).
Once you are satisfied with the condition of the property, make sure the tenant has no rent or excess water usage charges outstanding as these can come as a nasty surprise if you don’t check!
After you have undertaken all of the above steps, you are ready to return the bond to the tenant. The beauty of this process means that the speed with which the tenant receives their bond refund is based entirely on their own actions in returning your property in an acceptable state.
– Nicole Keene
Nicole Keene is property manager at Blink Property. Nicole has almost a decade of property management experience behind her and specialises in proactively managing investment properties. Nicole has recently joined the Blink Property team, part of the binvested.com.au group of companies.
DAMAGE TO PROPERTY
I am about to undertake an inspection of my property and have some concerns about the current tenant’s treatment of my investment. How do I differentiate damage that can be considered malicious, and what is classed as acceptable wear and tear? What should I look for to prove that a tenant has maliciously damaged my property?
Malicious damage to your property is any intentional damage that is clearly caused by the tenant’s negligence or mistreatment of the infrastructure. For example, you may find several cuts in your near-new kitchen bench surface. This is classed as malicious and the tenant is liable for repairs, because they have neglected to use a chopping board to protect the surface. A hole in the living room wall would also be classed as malicious damage as the tenant has either intentionally kicked it or has carelessly rammed something through it.
To make a clear differentiation, wear and tear is the day-to-day deterioration of paint, doors, blinds, floor coverings and the like that occurs over time and through regular usage. In your property, these are the things that are walked on, pushed, pulled, opened and closed during the everyday use of the property and therefore a degree of wear is to be expected. To give you an example, if you find your bathroom door handle is worn and loose, this can be classed as wear and tear as it has been used every day and has possibly reached the end of its lifespan.To put it simply, malicious damage should not be caused to any part of your property if everything is used with a degree of care and in keeping with its intended use.
– Nathan Birch
Nathan Birch is a well-regarded property investment expert. A prolific property investor himself, Nathan is well known for his simple yet effective investment strategies. At just 28, he personally owns a portfolio of more than 72 properties. Nathan Birch is the co-founder of the binvested.com.au group of companies.
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