All Topics / Help Needed! / Urgent advise needed re tenant terminating lease early

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  • Profile photo of pasandbecpasandbec
    Join Date: 2005
    Post Count: 122

    OK, it's a bit of a long story so I'll try and cut it short…

    Basically the tenant in my property told me a week ago that she has to move out (18 months into a 2 year lease) as her partner still hasn't found employment (which I find hard to believe as there are lots of jobs at the moment, especially in his field) and that she has been sacked from her job and is declaring BANKRUPTCY. She said she is giving 30 days notice and sent an email to me to formalise it.

    Since I was considering selling my property anyway I figured it was fate as I believe it's easier to sell a place empty so you open up your market to people that may want to live in the property straight after settlement. Anyways, so I told her (verbally, nothing in writing) that I was sorry for her circumstances and that it was ok, that I would either find a new tenant or sell the place.

    1 week later and I have the property on the market. I have left the sale in my sister's hands as she used to work in real estate and is great at this stuff. She lives in canberra (where the property is), I live elsewhere. Anyways, my sister and the tenant (let's call her F) have spoken once in regards to getting a prospective buyer through the place.

    My sister came to me aferwards and said the tenant is VERY rude and anal, saying things like "oh and by the way when I moved in, the oven was filthy" and "I caught your Mum vacuuming the floor too" and all this other unnecessary crap which should be dealth with through Condition Reports, etc.  Nothing was organised with getting the prospective buyer through the house as he had't returned my sister's call.

    Anyways, the tenant rang me this morning to say that my sister had sent her an email asking if it was ok to show a potential buyer through the house this Wednesday but that SHE DIDN'T WANT HER GOING THROUGH THE HOUSE as she thought she was VERY rude when she spoke to her! (obviously a major clash of personalities) She said it was ok for me or my Mum to show someone through the house but not my sister. I was going to tell her where to go right then and there but instead I said I would look into it and phone her back. I wanted to check things out first and to gather my thoughts. When I got off the phone I rang the ACT Tenancy Tribunal and they basically confirmed what I suspected, that she didn't have a leg to stand on and that I could get anyone I wanted to show people through the house. Whilst I was on the phone to them I also asked about the tenant giving 30 days notice and the law surrounding that… well, I have been a very generous landlord, put it that way!! She is a very silly woman, being difficult like this because I could turn around to her and say sorry, I am not accepting your early termination, and make her apply to the Tenancy Tribunal for 'hardship', and have a court hearing follow, etc.

    So then I rang her back. I said I am not going to bother my Mum by asking if she can show someone through and that I have left the sale in my sister's hands and that she'll be the one showing people through. I told her how I had rung the Tenancy Tribunal and that they told me, so long as I gave 24 hours notice, I could get whoever I wanted to show people through. I also said to her that I chatted to them about her giving 30 days notice to move out and that I'm alot more clued up on all that (insinuating that she should be very careful about not pissing me off as I could take her to the dry cleaners). I said that I thought I was being VERY reasonable adn generous just taking her word for it re being bankrupt etc and that she should do me the same courtesy by allowing my sister through. Well! Didn't that stop her in her tracks! She umm and arr'ed and said ok well when are they coming through…..

    I am thinking that I shouldn't tell my sister about this as she will want to rip into her big time. I just want things to run smoothly but part of me is pissed off and wonders if I should make her apply to the Tenancy Tribunal. Perhaps I am due for some compensation. At least the fees to re-advertise for a tenant (even though I am selling it), etc..??

    Sorry this was so long, but what are your thoughts please???

    Profile photo of pasandbecpasandbec
    Join Date: 2005
    Post Count: 122
    Profile photo of thinkerthinker
    Join Date: 2005
    Post Count: 29

    Be transparent, straightforward and non-emotional. Allow some reasonable allowance for those less fortunate (either emotional intelligence,  financially endowed or other circumstances) and you will be fine.

    It is an investment after all…. Best not to react and be pissed off.


    Profile photo of DazzlingDazzling
    Join Date: 2005
    Post Count: 1,150

    We used to have these dramas when we bought residential property.  You get over all of the female emotional side of things and eventually you start concentrating on the dollars and treating it like a professional million dollar business that it is.

    Being forced to wade through people's private lives to protect your investment, and all of the situations that may occur (couples splitting up, divorce, domestic violence, job loss, ill health, pregnancy, the list goes on and on) which have ramifications for your business model trying to extract the maximum growth and cashflow.  Can you see the massive divide ??  As an investor, you somehow have to bridge the gap between their private lives and tangle of emotions with your bank's mortgage payments.  You're piggy in the middle.  None of these excuses wash with your bank.  It's up to you as an investor to convert the situation to cash.

    Short term, going head to head with this female tenant, well honestly, what's the point…..doesn't seem to be too much mileage and cash there really.  You could drag her through the tribunal, or threaten to, for a moral victory I suppose…..but at the cost of an ulcer and 6 months worth of mortgage it's probably not worth it.

    Look, at the end of the day, if you are going to invest in these type of assets, then this is the type of accompanying domestic problem is always going to rear it's ugly head.  Their top priority is safety of tenure, reducing their expenses to the minimum and doing the least amount of work around the house as possible.  Your goals are not aligned…..never will be.

    My short term suggestion is get the property re-tenanted ASAP…..don't sell.

    My long term suggestion is, if you don't want to keep skipping around this merry circus, start purchasing assets that attract business focussed tenants where your goals are similarly aligned.

    Above all else, treat the property game we play as a numbers game.  There is no emotion on a XLS.

    Profile photo of XeniaXenia
    Join Date: 2002
    Post Count: 1,231

    Treat this like a business transaction (it is) and keep emotions out of it. Your sister should do the same.
    The tenant can afford to get emotional, you have more to lose!

    Set a time with the tenant once a week, say 12pm on a Saturday where you can have a 45 minute access to the house for the purpose of showing prospective purchasers through. Don't bother her any other time.

    We've found that flowers and chocolates work well with tenants just to show her that you appreciate having access.

    Otherwise wait for the 30 days, get vacant possession and begin showing people throught then. You can begin accumulating enquireis in that time and show everyone through when you have vacant access.

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