I am the Director of the business and I manage the rent roll with my Business Operations Manager & Administrator (Lara Tarrant & Leonie Baumer – Also known as ‘My left & right arms’!)
15 years this year. I have worked for four different agencies in my 15 years and the fifth has been my own, New Stage Property.
117 at the moment. We don’t intend to manage more than 250 properties as I believe this is the optimal number that Lara, Leonie and I can manage comfortably.
We have a team of 4 in total but in my direct team there is Lara and I. We also have John (also my husband) assist with maintenance items such as dropping off lockboxes, taking photos for entry reports etc and Leonie who does administration and ensures that maintenance is being attended to in a timely manner.
With the vacancy rate in Brisbane being higher than we like it to be, we have taken a much more pro-active approach to sourcing and securing tenants. We still do the normal advertising on websites (7 different website total) etc. but we conducted a lot of research when we opened the business to determine what it is that makes a tenant choose a property and we don’t waste our money and things that simply do not work.
For example – For lease signs, they are good for business branding, but tenants don’t choose a property because of that. We use the $100 that we would spend on a sign for targeted marketing’s on social media instead. This is called geo-targeting and websites such as Fairfax media and platforms such as Facebook have been using it for years. What this means is that we get the property in front of tenants who are showing signs of possibly moving. If they are searching for removalists costs or end of lease cleaning costs, our listings will start showing up then too.
This is a very short way of explaining it but the purpose of this is to get in front of the tenants, not wait for them to come to us.
We also only do premier listings on Realestate.com which gets 58% more exposure than a standard listing on any of the major portals. To co-inside with this, all our properties have professional photography done as 80% of tenants will scroll past a listing in a popular suburb if it doesn’t have professional photos.
We do video open homes through Facebook which again gets much more exposure for your property than the normal 15-minute open home. It also means that international and interstate tenants can apply for the property without having to see the property also. In addition to the video opens we also do private opens (if the property is vacant), mid-week open homes and Saturday open homes.
All of this combined has got our average days on market down to just 10 (from the time we advertise to the time a tenant is secured), the Brisbane average is between 26 and 35 in some suburbs.
We only charge 4 fees total being the management fee of 7.7% inc GST, letting fee of 1 weeks rent + GST, advertising of $330 inc GST and a Tribunal/Insurance Claim Fee of $110.00 per hour.
There is also an annual subscription fee for smoke alarms of $99 to be paid on invoice to Smoke Alarm Testing Services but this is not a New Stage Property fee, it is just a requirement that the smoke alarms are complaint by law and this is done by them.
The only variance in these fees would be in you had a property that required the New Stage Property team to attend prior to the time of advertising to attend for building inspections or to allow access for quotes etc. The letting fee is then 2 weeks rent + GST however this is discussed with you prior to you being charged.
Minimum 2 per year and a maximum of 4 and we do not charge for the inspections. This is included in your management fee.
We like to conduct the main inspections in March/April and August/September and outside of school holidays as tenants are much easier to deal with (and the houses are much cleaner) when they are not stressed with Christmas, Easter etc. This also means we can do any re-inspections in May/June or October/November so we are out of the tenants way by Christmas.
We do a lot of long-term asset management for our owners which is reporting issues that need attention but not necessarily something the tenants report. This can include items such as hot water system is on its way out or air con is leaking profusely. This means we can prepare for the potential cost of the replacement before it becomes an emergency or it’s the middle of summer and we can’t get an air con repairer for 3 or 4 weeks (this will equal unhappy tenants).
Getting maintenance done between March and May and between August and September is much easier for our trades also as they are also not trying to fit in work around public holidays.
We do weekly disbursements to lessors on a Monday so any funds available on a Monday will be paid to you regardless of how we collect the rent. If your tenants are paying the rent weekly, then you would get a payment weekly. If they pay fortnightly, then the payments will be fortnightly. And yes, this is directly credited to your account and a statement is emailed to you at the same time.
We have a much more pro-active approach to this issue also:
1. We tell the tenants 4 days before the rent is due, every time the rent is due. This tells them that we are paying attention to what they are doing and will know if the rent is not paid on time.
2. The tenants are told when they sign up with us that rent MUST be paid on time as we have zero tolerance policy for arrears. The simple fact is that if tenants don’t pay rent, we don’t get paid and we can’t run a business if we don’t get paid.
3. If the tenants should fall into arrears, we start texting and emailing them on the second day they are late. I reconcile the bank accounts everyday so if tenants pay rent on the day it’s due, then it would be in the account the next day so if it’s more than 2 days late, they haven’t paid it. They will then get texts and emails on the 3rd, 4th and 5thday, by the 6th day we start calling them (and possibly dropping by if we are concerned about them but we try not to do this these days as the Tribunal deem it harassment) and the 8th day it’s a notice to remedy. The 15th days is a notice to leave and I tend to start Tribunal proceedings at this point also if they haven’t contact us at all. Normally tenants will have contacted us by this point, it doesn’t change the course of action but at least we can work with them not against them.
We also try to assist tenants who are in hardship situations so we can get them paying rent on time again quickly. We work with several community organisations who assist women and families in crisis with rental payments, bond payments, food parcels, clothing etc.
At the end of the day, it is better to help a quality tenant through a difficult time and get them back on track them bully them out of the house and have it sit vacant and have a loss of rent.
This is challenging as we only attend the inspection twice to four times a year but we do drop a letter into the neighbours houses to say we are managing the property. That way if anything untoward happens at the house, they will normally call us to let us know. Owner occupiers in a street will normally tell us if cars are being dumped or the grass is excessively long also.
We can normally tell at an inspection if the house is being maintained regularly or if they have just done a big clean up before the inspection though. If this is the case, we use the other two inspections to attend the property more regularly. If we do have a tenant we are concerned about, we can add lease clauses to say we can drop in (with notice). If the tenants are not happy with this, it’s a warning sign for me straight away.
Yes we have, particularly in February 2019 as I became unwell in January 2019 and this had a knock on effect to the team and to some of our clients. We learnt a lot from this as it determined that the business was far too reliant on me, this is part of the reason why we have two other people who work so closely with me and why our team are so well rounded. I want our team to feel empowered enough to make a decision and keep the business moving forward should I ever become ill again.
It will be Lara, Leonie or John who will jump in if I am on leave. The way that we have designed our business is to embrace technology heavily so that there is full transparency for our team. This way anyone can jump in and take over a task without disruption to our business or to our clients.
Right now, we have 4 tenants (out of 102 properties) who are in arrears by more than 3 days. Unfortunately we do have a few naughty tenants who pay rent late consistently so the number of tenant in arrears can go up to 9 on some days (Friday’s particularly as this is when leases tend to start, so rents are generally due on a Friday).
5% of our portfolio is classed as vacant at the moment but this is also between tenancies (as in, one tenant is moving out and we have another tenant to move in). We only have 2 properties that are truly vacant or what we can non income producing. During January, this number can go up to 15% as there are lots of tenants moving in and out however we have planned for our team to be able to handle 20% vacancy so we have a 5% buffer, even in the busy time of year.
I have had a couple of tenants cause serious damage in 2019 unfortunately but both have been delinquent tenancies (where we have taken them over from somewhere else and the tenants have already been trouble tenants).
The first was in Wulkuraka in February 2019, we were able to get the tenants to vacate within 2 weeks and had the house cleaned but the tenants broke in and damaged some walls and ripped some of the light switches off the wall. Just to be difficult.
The second is the eviction we had in late 2019. The tenants didn’t cause a lot of damage but left a lot of rubbish inside the house and the kids have drawn on some of the walls. The tenant is not well mentally and I think this played a large part in the issues we have had. We started advertising this house again on Friday and I aim to have tenants moving in early next week so the house will only be vacant for 1 week.
The real key with situations like both of these is planning and timing of trades. It helps greatly that the other director in the business (John) has a history in constructions so he can help to change locks, move belongings, organise skips etc. Making sure that the trades turn up on time, do the job and leave so the next trade comes in is key.
I would also note that in both of these situations, the landlords have had good landlords insurance so they are protected from the thousands of dollars of cleaning, lock replacements etc. I can’t give you advise on landlords insurance but it is important to make sure you have a good policy that covers multiple events.
More information on landlords insurance and it’s importance can be found at our website here:
https://newstageproperty.com.au/free-resources(Scroll to the bottom of the page)
This is a 3 stage process:
1. We start to do our assessment when we meet the tenants at the open homes. If they reek of cigarettes or they don’t respect the property or the current tenants belongings, it’s not a good start for us. It’s important for us that potential tenants take the relationship they have with us seriously and we like to get this right from the beginning.
2. When the applications come in we check their references including current employment (to ascertain if they can afford to pay the rent and what they are like as a person at work (Clean, neat and tidy? Respectful of others? Careful to follow OH&S rules? Etc.)) and we check their current rental references. We are not so much looking for the answer the questions we ask but how they answer them, for example, if we ask if the tenants pay rent on time, we want an answer with conviction that says yes. If we hear hesitation, this starts to ring alarm bells for us. We are also very conscious of ‘Private landlords’ and check that the private landlord is actually the landlord of the property against the government data through a title search. If they are not the landlord, we call their agent who rented the house last (which we can also find out) and find out why they didn’t put them down as a reference. With regards to income and employment, we verify income both verbally and by payslips, when asking general questions about who they are as a person, we are again looking for the way they answer the questions, not just the answers to the questions.
3. We bring the application to you for the final go ahead.
To summarise, I have to make the application make sense to me first. We are the ones who have to put up with these tenants for 12 months so it’s very important to us that you make an informed decision. We will always give you our opinion based on what we think is best for you but this won’t always be to rush in with the first application we get, sometimes it’s better to wait a week, then rush in and have to live with the decision later.
A couple of things:
1. Weekly owner disbursements. If your tenants have paid rent to us, we will pay it to you the following Monday so by the time another agent has done their monthly payments to you (normally at the end of the month) you could have had 4 payments from us.
2. Low days on market - We rent our properties in 10 - 14 days! The Brisbane average days on market is 28 to 35 days!
Our high end, professional marketing means we have been able to not only rent our properties quicker but to a great quality tenant who will stay for a 2 or 3 years.
Longer term tenancies mean less vacancy and less loss of rent to our landlords! See our marketing in action here.
3. Our fabulous team! I have touched on John’s experience in Construction. Lara has experience with financial planning and banking, Leonie is a qualified and experienced teacher and Amber has a background in Commercial Real Estate.
What these jobs have in common is people and I want our team to be powerful people managers, not just property managers.
Someone who is good with people will get tenants paying rent on time and coach tenants on caring for a property properly. These are skills you can’t teach and they are skills that can make (or break) the management of a property. Unhappy tenants who don’t feel respected will move house regularly, not because they don’t like the house, but because they don’t like the property manager.
As an investor, you want stability with the tenants, not vacancy every 12 months and having to pay letting fees annually.