Rental Property Newsletter 2
What is a tenancy tribunal? And how does it protect your investment property?
A tenancy tribunal is an independent body that deals with certain disputes between landlords and tenants. In each state, it is generally called a civil and administrative tribunal. The tribunal is designed to make legal decisions and help resolve disputes by hearing cases. Keep reading for an overview of tenancy tribunals and how these can help to protect your investment property.
Tenancy tribunals help landlords and tenants Whether you’re dealing with a tenant who has severely damaged your property, or they’ve stopped paying rent, a tenancy tribunal will hear the matter and make legally- binding decisions and orders. Similarly, if important repairs and maintenance aren’t completed in a timely manner, particularly those that relate to the security and liveability of the property, a tenant may apply to have the matter heard before a tribunal. In these cases, the tribunal member hearing the case may order the landlord to fix the issue in a specific timeframe. from those who have witnessed any of the events or actions related to the case, invoices or quotes for items such as cleaning and repairs, copies of all written communication between your property manager and the tenant, copies of breach notices issued, and any relevant photos.
Preparing for a tribunal hearing
Once a matter is referred to the tenancy tribunal either on your behalf by your property manager or by your tenant and their representative, the tribunal will set a date for the hearing and inform you in writing when it will be held. You will need to gather evidence to bring to the hearing to support your argument. This may include a copy of the residential tenancy agreement, a written statement summarising your case, statutory declarations
What happens at the hearing?
At the hearing, the tribunal member hearing the case will try to help both sides come to an agreement (conciliation) on resolving the matter. If an agreement can’t be reached, the tribunal will hear your case. When the case progresses to a hearing, it is more formal and the applicant who referred the case to the tribunal will need to present their case. The other side will then have the opportunity to answer the claims made. Once the case is heard, a decision will be made and a notice of orders explaining what will happen is issued. This is where timelines for actions such as repairs or maintenance or payment of money owing will be outlined.
A tenancy tribunal is a neutral and effective place for disputes between landlords and tenants to be settled. It can be a helpful way of formally resolving issues before they escalate and become more costly. If concerning activities or issues occur at your property, your property manager will be able to inform you of the appropriate steps and when it should be referred to a tenancy tribunal for a hearing. In some cases, some communication between the property manager and tenant may resolve an issue. If not, the tenancy tribunal will reduce the risk of further damage to your property or your finances
What happens if my tenant stops paying rent?
Having a dream tenant in your property is great. Everything is looked after as if it were their own home, and the rental payments always arrive on time. But what happens when your tenant stops paying rent? Hopefully, this isn’t a situation you’ll
ever have to face as a property investor. Regardless, it’s important to understand your rights and what to do when those weekly or monthly payments stop.
Keep reading for an overview what to do if your tenant stops paying rent.
Be mindful of your mortgage
Most property investors carry a mortgage on their property. Whether your property is negatively or
positively geared, having the cash flow from rental payments each month is important. Tenants can
stop paying their rent for several reasons such as financial challenges, job loss, falling ill, or living
beyond their means. Just like having cash set aside for repairs and maintenance, having money
available in case a tenant stops paying their rent can reduce the initial stress while appropriate
actions are taken.
Keep your insurance up to date
Having adequate landlord insurance coverage can
help in times when your tenant stops paying rent. If you have cover for loss of rent in cases where the
tenant stops paying, you can submit a claim to be reimbursed for the missed rental payments.
Keep open communication with your property manager
If you have a good tenant who is facing a difficult
time and you’re comfortable with it, you could have your property manager negotiate and agree with
the tenant to make partial rental payments followed by larger or more frequent payments to make up
the difference in the near future. Your property manager should already have clear lines of
communication with your tenant, so making the time check in with them before issuing breaches
can be a more amicable place to start, especially if they’ve been an otherwise good tenant.
How to escalate late or no rental payments In cases where it doesn’t look like your tenant will pay their rent, your property manager will
need to follow the steps relevant to your state’s tenancy legislation. The legislation differs
between the states, predominantly in terms of when a breach notice or notice to vacate can be issued.
Generally, the steps to address (and possibly evict) a tenant who isn’t paying their rent is as follows:
1. Communication between the property manager and tenant hasn’t resulted in an
agreement on when and how missed payments are made.
2. A breach notice is issued.
3. If the tenant still doesn’t pay their rent, a
notice to vacate can be issued. Generally,this should be delivered via registered post and
adhere to the timelines in your state’s legislation.
For example, once the tenant is in arrears by 14 days.
4. File the matter with your state’s relevant tenancy body so the tribunal can make a
decision. A possession warrant may be issued at this point.
5. If applicable, follow the steps in your state to claim the tenant’s bond money to cover the
missed rent payments.
Missed rental payments can be stressful. Having your property manager keep communication
clear while taking the appropriate steps in your state to action the problem quickly can help you get your rental payments flowing again sooner
rather than later.
