01 Ogos 2010

Renting Guide For Landlords

How To Rent Your Property

The most usual way to rent a property is through estate agents. Some landlords choose to market their properties privately to save on the estate agents’ commission but this solution has the following disadvantages:
  • it can be very time-consuming as you will have to do all the work yourself, including advertising and showing the property to prospective tenants
  • it may take longer to rent your house as you are likely to get fewer viewings than by letting professionals market your property
  • you may end up getting a lower rent as you are likely to get fewer viewings and therefore less interest in your property.


Selecting estate agents

Use several agents to market your property as this will result in your property being more widely advertised. You will only pay commission to the agent who actually rents the property so using as many agents as possible will not result in higher costs. Select estate agents who specialise in your area or property type as their client list will have the right prospective tenants for your property.
The easiest way to find suitable estate agents is to look at advertisements for similar properties on thinkproperty.my and contact the agent. Or drive around your area and look for agents’ signboards on properties for rent.

Help the agent help you

When giving your property details to the agent emphasise your property’s individual selling points. Think about any positives, from a large kitchen to an alarm system, or a good school nearby.

If possible, take digital photos of your property which the agent can then send to prospective tenants or use in advertisements.

Renting costs

Estate agents charge 1 month’s rent as commission for renting a property. The small stamp duty fee on the rental agreement for rents exceeding RM2,400 is payable by the tenant.

Renting furnished, part-furnished or unfurnished?

Most tenants will require at least a part-furnished place, ie including such items as kitchen cabinets and curtains as these are specific to a property and tenants are generally unwilling to incur costs when they will be unable to take the items with them when they leave.

Advantages of renting a place without furniture:
  • no hassle of having to buy furniture
  • no initial capital outlay
  • many tenants prefer part-furnished accommodation as they already have or intend to buy their own furniture
  • tenants are unlikely to look after furniture which does not belong to them, although the deposit can be kept back by the landlord in case of damage
Advantages of renting a place fully-furnished:
  • tenants who are looking for fully-furnished accommodation will pay a premium for the convenience of renting a fully-furnished place
  • good furniture will make your property look much better than if it is left unfurnished and could thus potentially be rented quicker and for a higher rent
Determine your asking rent

How to determine market rent?
Estate agents will advise you on how much rent you can expect for your property. Be aware that some agents may give you a high expected rent in the hope that you will market the property through them, but overpricing may result in lack of interest from prospective tenants.

You may also want to view a few similar properties in your area in order to get an idea of how much your property should rent for.
The following properties usually rent at a premium:
  • modern properties
  • beautifully-furnished properties
  • properties in areas favoured by expatriates (eg, Damansara Heights, Bangsar, Ampang)
  • properties close to transport links or facilities such as shops or schools
The asking rent will normally be the highest rent you expect someone to pay for your property. The asking rent is usually negotiable and landlords will usually settle for an amount below the asking rent, unless there is a lot of interest in their property in which case they may rent for the asking price or even above the asking price.
Your asking rent will depend on your circumstances – if you are in a rush to rent your property a lower asking rent will potentially ensure that it is rented quicker. You may also decide to revise your asking rent after viewings have started – if the property is not generating any interest it may be best to lower the asking rent. Speed is crucial in the renting game: remember every month the property is not rented means one month’s rent is lost.

Viewing time

The estate agents you have instructed will market your property and arrange with you a convenient time for prospective tenants to see the property. You may choose to be present during viewings or let the agent show the property on their own. Prospective tenants may feel more at ease viewing the property without the owner being present but by being present you would have the opportunity to address any concerns the tenant may have about your property.

If your property is currently tenanted check your rental agreement to ensure you have the right to bring prospective tenants in the property. If not ask your tenant if they would allow viewings. Either way you will need to give reasonable notice to the tenant and arrange for viewings at convenient times.

Presentation

Before allowing any prospective tenant in your property, you need to consider how best to present your property in order to optimise its potential. A few simple steps can greatly enhance the appeal of your property to prospective tenants:
  • clean up: remove all clutter, make sure your property is sparkling clean and smells fresh and pleasant
  • ensure comfortable viewing: switch on the aircons or fans before viewings; also switch all the lights on before viewings so the rooms are full of light  
  • time for repairs: fix any leaks, creaky doors and jammed windows
  • decorate: plants and pictures are easy ways to enhance the look of your property
  • don’t forget the outside: first impressions count so tidy the front of your property; a beautifully-landscaped garden can also add much to a property.
Negotiations

A tenant is interested in your property and has made an offer through the agent who showed him your property. First of all make sure you find out from the agent what precisely the buyer expects to be included in the price he is offering in order to avoid any misunderstandings (eg, furniture, curtains, fridge). Also find out the prospective tenant’s employment credentials to determine the risks of the tenant defaulting on the rent. You now have the choice of accepting the offer, or rejecting it and possibly making a counter-offer or just sticking to your asking price.

The landlord’s position
What you decide will depend on your circumstances at the time you receive the offer: 
  • Are several tenants interested in the property and can you realistically expect a higher offer?
  • Has the property been on the market for a long time without generating much interest? Is your asking rent realistic? 
  • Are you in a rush to rent your property?
The tenant’s position
Be aware that many tenants make offers which are lower than the rent they are prepared to pay for the property, to start off negotiations. Talk to the agent to get an idea of the tenant’s circumstances (are they interested in other properties? what is their budget?)

The agent’s position
The agent works for the landlord. He is paid by commission amounting to one month’s rent so he has an interest in obtaining as high a rent as possible. The agent should know the market inside out so it is worth listening to his advice. However do be aware that he also has an interest in making the tenancy happen, even at a lower price, rather than not happen at all.

The rental agreement

Once the rent is agreed between the tenant and you, the tenant will be expected to pay the first month’s rent to you to confirm the deal. On signing the rental agreement the tenant will pay 3½ months’ rent to cover for the security and utilities deposits.

The rental agreement will typically feature the landlord’s and tenant’s particulars, the address of the property, the agreed rent, the term and commencement date, as well as the tenant’s and landlord’s covenants.

The tenant normally covenants to, inter alia, pay the rent, not cause a nuisance, keep the property in good condition, allow the landlord to show the property to prospective buyers or tenants.

The landlord normally covenants to, inter alia, carry out any repairs notified by the tenant, take out fire insurance, allow the tenant to peaceably occupy the property.
If the tenant is an expatriate, the rental agreement may contain an expatriate clause specifying that the tenant may end the agreement if he is transferred to another location. The tenant may wish to negotiate other clauses, such as the right to end the agreement if a development starts near the property. The agreement will also stipulate what is to happen at the end of the term, eg tenant to give notice to end or renew the tenancy.

The tenancy agreement also often includes the inventory for the property. Ensure that the inventory includes all the items present in the property when the tenancy starts to avoid any dispute at the end of the tenancy. You may also want to take pictures before the tenant moves in to have a record of the condition of the property before the tenant moved in.

The end of the tenancy

The tenancy is coming to an end and the tenant does not wish to renew the tenancy. Make sure you start marketing the property for rent well in advance (preferably at least 1 month) of the expiry of the tenancy so as to avoid tenancy voids. Your rental agreement should include a clause allowing you to show the property to prospective tenants.

When the tenant leaves, inspect the property and go through the inventory to ensure they are leaving the property in the condition they got it in (allowing for normal wear and tear); you are entitled to retain part or all of the deposit to carry on any repairs or cleaning or paying any bills which were the tenant’s responsibility.

[dipetik daripada www.thinkproperty.com.my]

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