Ray White Snells Beach
Investor Gate Property Management Newsletter - August Issue
Market Report
The rental market, somewhat like the residential real estate market, continues to be somewhat erratic. While colleagues in the central Auckland area tell us of a severe shortage of available rental properties, this is not the same scenario throughout the region, or the lower north with varying results from area to area.
What is consistent is that tenants are being far more selective when choosing a property to live in, particularly families. With the general cost of living constantly on the rise and the costs associated with moving or relocating, tenants are wanting security in their terms of agreement and a good standard of property. Owners who appear reluctant to maintain their properties to a good standard are finding that tenants are reluctant to rent them, even for short-term while waiting for the ‘right’ place.
Orewa: As soon as a property is advertised we are getting a flurry of interest, which disappears within a couple of days. Tenants are thinking very carefully before shifting house, due to costs. Higher priced properties are attracting very little interest.
Warkworth: General enquiry for rental properties has dipped a little over the last month, compared with July. However, our office took on six new managements over the month. The rental market is still quite unpredictable and properties that have previously been quite easy to let, are sitting.
Mangawhai: Interestingly, we are experiencing difficulty finding properties to let in this area. Analysis of the market here indicates that there is very little rentals available at all, although we have a constant flow of tenants searching.
Maungaturoto: Applications for properties was up on last month, but not enough to satisfy the availability of rental stock. WINZ appear to have tightened their criteria and a number of applicants have been refused further aid.
All in all, a bit of a mixed bag throughout the districts covered.
Conference 2011
Recently, a number of us joined over 200 other property managers to attend the annual REINZ New Zealand Residential Property Management Conference, held in the new Claudelands Conference and Exhibition Centre in Hamilton. The Centre only opened in recent months and it really is a magnificent attribute for Hamilton City.
One of the astonishing facts that came to light over the two-day conference was the difference between Australia and New Zealand in regards to the percentage of residential rental properties that are managed by property managers. In Australia 80% of rental properties are managed by property managers, whereas the reverse is true in New Zealand with between 20% and 26% only, being professionally managed. It may be the kiwi “DIY=can do it” mentality that makes property investors want to have a go at looking after their own properties, but it could also indicate why the Tenancy Tribunal Courts are so clogged and many horror stories surface due to poor management of rental properties.
Attending these conferences and continually upskilling our own property managers is vitally important to ensure we are in the very best position to manage our clients properties better.
Other topics discussed were the growth of meth-labs in suburban areas, insurance issues, legal and educational issues plus a raft of ideas on how to improve our service and communication with you. There was an extremely valuable session called “Dealing with a natural disaster”, where a panel of business owners spoke of managing properties during the recent Christchurch earthquakes—very enlightening.
We will continue to attend these conferences where we learn from others, how we can be better.
Of course, if our property investors suggest ways in which we can improve our service, we are always happy to hear their thoughts as well.
Give us your feedback
Many of you have been reading our newsletter for the last two and a half years now. Here is your chance to give us some feedback.
If there are things you would like to see, let us know. Is the format working for you? How would you like it delivered to you? What matters would you like covered?
Don’t spare our feelings—we are open to suggestions. Please email Ken Bogue. My email address is ken.bogue@rwwarkworth.co.nz
Critical Issue Requiring Your Attention All Investment Properties are at Risk from Meth Cooks We Want to Help you protect and Enhance your Investment by Reducing this Risk
We recently included some information in our Newsletter regarding meth lab risk and a product called MethMinder, designed to help deter meth criminals from choosing to live in your property. The response we have received to this has been unprecedented, with people keen to learn more. To this end we are engaging with MethMinder in an effort to use our collective ‘buying power’ to get our individual clients a better deal than they could achieve on their own.
We believe that the service we provide to you reduces the likelihood that your property will fall victim to meth cooks. With so many landlords who have limited property management experience self managing properties, there are thousands of properties where it is easier to cook meth than a property we manage.
That said there are limitations on the service we can provide. We want you to be aware of these and the additional options for management of this risk that you can choose to employ.
What we can do
These are the things we do to help manage this risk.
· Tenant Vetting
We place all tenants through a rigorous vetting process. This includes:
· Reference from former landlords
· Credit checks
· Confirmation of employment status
Only when a prospective tenant has passed these tests do they get to move into your property.
· Regular Inspections
Once they have moved in then we conduct regular inspections, in the main every 3 months, or as you have instructed, addressing issues as they arise.
It should be noted though that under Residential Tenancy Act, we are required to give 48 hours notice to access a property. A Methlab can be concealed in a suitcase. It takes minutes to put together and break down. So, while some poorly managed meth labs can be easily spotted, it is not hard to hide away the evidence of meth being cooked from even the most diligent inspection.
This is one of the reasons why we recommend to clients, where it is relevant, that we arrange for a third party contractor to say mow lawns. They then report back any suspicious activity.
· Engagement with Neighbours
We make a point of letting the neighbours know who we are. This allows them to report to us in the event a tenant is misbehaving. Where meth is concerned, too often neighbours seem afraid of getting involved and do not communicate with either ourselves or the authorities.
Risks we cannot Control
There are a number of risks particular to the meth issue over which we have little, if any control. These include:
· Tenant’s criminal records, partners, family and friends
Under the terms of the Privacy Act, we can no longer check for criminal records.
In addition, we cannot vet the details of a prospective tenant’s partner, family members or friends. All too often it is these people who coerce an otherwise ‘good’ tenant, into using a property for the purposes of cooking meth.
· Change in personal circumstance
Tenant vetting is relevant to a point in time only. People’s circumstances change. Tenants which seem ‘good’ one year, can make poor lifestyle choices that see them turn ‘bad’ the next. We are not in the property 24/7 and with three months between inspections, this is plenty of time for damage to occur.
· Action/Inaction of the Courts and Police
We understand it is a legal requirement that the courts check with property owners before they bail a person back to a property and that they have passed responsibility for doing this to the Police. This is not happening. Consequently, people involved in meth are being bailed to properties with no knowledge of property owners or managers.
What we are doing to help reduce risk
Insurance is something we advocate to all clients. Insurance though is the ‘ambulance at the bottom of the cliff’. The insurance we recommend does provide limited cover. However, this will certainly not include the loss of value associated with the property with the property having been used as a meth lab!
As mentioned at the start of this letter, we are investigating MethMinder on your behalf. Other Property Management companies in the Ray White Group have worked with MethMinder and for those people who do make a conscious decision on meth lab risk management, nearly 50% are choosing to reduce risk by installing MethMinder.
Given this experience, we feel it is something worth exploring and if we can negotiate a better deal on your behalf, then we will feel we have done all we can to help give you peace of mind. We will contact you again shortly once we have more detail on what MethMinder is prepared to offer.
Below is an article that appeared in the Waikato Times recently. The article refers to the actions of a Property Manager and her business in Hamilton. Lett Property Management is not a member of the Real Estate Institute of New Zealand and therefore is not compelled to hold rent monies in a trust account, whereas REINZ members report to Auditors on a monthly basis.
Money issues cast cloud over property manager Nikki Preston, Waikato Times
A Hamilton property manager is under fire for allegedly withholding rent payments from landlords.
Hamilton couple Mary-Anne and Trevor Watson, Auckland property manager John Howsam, and Nelson couple Mike and Janet Teece allege they were left out of pocket by Lett Property Management (formerly Residential Property Management Waikato). All three say they were paid after the Times got involved this week.
They say director Corrina Bell (formerly Corrina Laird) gave various reasons for non-payment – which included claims of a faulty computer and a sick husband.
Mrs Bell lost a child last year which also caused delays in payment.
Mrs Bell has built a reputation in property management circles and as a 26-year-old in 2006, said she ran a million-dollar business. She also had a property column in the Waikato Times several years ago and had a segment on Community Radio in Hamilton offering advice on investing and real estate.
The Waikato Times understands Lett Property Management manages between 60 and 70 properties.
The property owners who spoke to the Times said they struggled to reach Mrs Bell and in some cases the only communications have been text messages promising them their money.
Waikato property managers say they are aware of a number of other rental property owners disgruntled with Lett Property Management.
Harcourts in Hamilton says it has been contacted by at least 15 owners who were looking to move properties from Lett. Quinovic says it has been contacted by six, Lodge by two and Ray White by one. The rental property owners are from New Zealand and overseas.
Corrina Bell told the Times this week the monetary claims against her were "at least 50 per cent exaggerated" and she believed she had been doing her job properly. She has since repaid the three property owners who spoke to the Times. Mrs Bell said the death of her son last year had contributed to some errors that she was now trying to rectify.
According to its website Lett Property Management offers a flat-fee service for $899 plus GST, or $99 plus GST a month to manage properties.
"We have had some substantial issues that have stemmed from when we purchased a previous franchise. There were massive issues in there that I didn't know about so I've had to work through that," Mrs Bell said.
She also denied claims more than 20 clients have transferred their portfolios.
Waikato Property Investors Association president Nancy Caiger said her advice to all landlords was to make sure their property manager held funds in a trust account. The deregulation of the industry in 2009 had seen a number of smaller firms being set up and she said landlords had to do their own checks before signing up with a property manager.
The aggrieved:
Nelson-based landlords Janet and Mike Teece say they were owed $7805 in November 2010, the point at which they realised they had not received a large chunk of rent from a property Corrina Bell was managing.
The couple received only three payments in nine months for a rental property she was managing in Dowding St, Melville, Hamilton. They terminated their contract in November and when they talked to the Waikato Times they believed they were still owed $4465. Mrs Teece said she had not heard from Mrs Bell for months until she received $3704 on Thursday.
Auckland-based property investor John Howsam – who signed up with Lett Property Management only in February this year – said Mrs Bell owed him money and did not reply to texts and voice messages, or respond to legal threats until this week. He said she was now communicating.
This week he received some outstanding rent, with promises of the remainder to come a few days later.
He said he did not care for excuses in business.
"I care about individual people but I don't care for it to be a reason because you're in business. No form of death or bereavement should cause that not to be upheld."
"It's bad enough if you have got tenants that don't pay, let alone a property manager."
"According to the previous property manager these tenants have never missed a beat."
Hamilton couple Mary-Anne and Trevor Watson said it was not until they realised they had stopped receiving rent and hounded Mrs Bell about getting their money that she told them the tenants in their Killarney Rd property were not paying their rent. "It wasn't until I had absolutely had enough and was getting distraught at having to transfer money to pay the mortgage," Mrs Watson said.
The tenants had not paid $2500 in rent but the Watsons are also aware Mrs Bell is withholding some more recent rent payments from them. "Corrina texted me to say she's got the money but every time I texted her to get the money I got no response."
The Watsons also received $2466 in their bank account on Thursday, despite Mrs Bell telling the Times this week that claims she owed them $2500 were significantly inflated.
Mrs Watson said: "I'm sure that without the Times' input things may not be quite the same at the moment."
THE YEAR IS 1911 This will boggle your mind, I know it did mine!
The year is 1911—One hundred years ago. What a difference a century makes! Here are some statistics for the Year 1911:
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The average life expectancy for men was 47 years.
Fuel for his car was sold in drug stores only.
Only 14 percent of the homes had a bathtub.
Only 8 percent of the homes had a telephone.
There were only 8.000 cars and only 144 miles of paved roads.
The maximum speed limit in most cities was 10 mph.
The tallest structure in the world was the Eiffel Tower !
The average US wage in 1910 was 22 cents per hour.
The average US worker made between $200 and $400 per year … A competent accountant could expect to earn $2000 per year, A dentist $2,500 per year, a veterinarian between $1,500 and $4,000 per year, and a mechanical engineer about $5,000 per year.
More than 95 percent of all births took place at home.
Ninety percent of all Doctors had NO COLLEGE EDUCATION ! Instead, they attended so-called medical schools, many of which were condemned in the press AND the government as “substandard.”
Sugar cost four cents a pound.
Eggs were fourteen cents a dozen.
Coffee was fifteen cents a pound.
Most women only washed their hair once a month, and used Borax or egg yolks for shampoo.
Canada passed a law that prohibited poor people from entering into their country for any reason.
The Five leading causes of death were:
1. Pheumonia and influenza
2. Tuberculosis
3. Diarrhea
4. Heart disease
5. Stroke
The American flag had 45 stars…The population of Las Vegas, Nevada, was only 30!!!
Crossword puzzles, canned beer, and iced tea hadn’t been invented yet.
There was neither a Mother’s Day nor a Father’s Day.
Two out of every 10 adults couldn’t read or write and only 6 percent of all Americans had graduated from high school.
Marijuana, heroin, and morphine were all available over the counter at the local corner drugstores.
Back then pharmacists said, “Heroin clears the complexion, gives buoyancy to the mind, regulates the stomach and bowels, and is, in fact, a perfect guardian of health!” (Shocking?)
Eighteen percent of households had at least one full-time servant or domestic help…
There were about 230 reported murders in the ENTIRE U.S.A. !
I can now forward this email to someone else without typing it myself.
From there, it can be sent to others all over the WORLD—all in a matter of seconds !
Try to imagine what it may be like in another 100 years. !!!!!!!!!!!!!!
IT BOGGLES THE MIND!!!
Disclaimer
In preparing this document we have used our best endeavors to ensure the accuracy of all the information provided. We accept no liability or responsibility for any errors or inaccuracies and recommend that all recipients make their own enquiries to verify any information given.