课 cppdsm4010a lease property

_______________________________________________CPP40307 Certificate IV in Property Services (Real Estate)

CPPDSM4010A (Elective) Lease Property

Learner Guide © The Australian Salesmasters Training Co Doc ID: CPPDSM4010A - Workbook (L) eLearning Date: 28/03/2018 Developed by: SL Version: 7 Approved by: CEO P a g e |1 File Location: S:\Learning & Assessment Resources\Real Estate\CPP40307 Certificate IV in Property Services (Real Estate) NSW\Assessment Tools\13. CPPDSM4010A\CPPDSM4010A - Workbook (L) eLearning.doc

_______________________________________________CPP40307 Certificate IV in Property Services (Real Estate)

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Australian Salesmasters Training Co P/L Registered Training Organisation #6854

Phone: Fax: Email: Mail:

(02) 9700 9333 (02) 9700 8988 Info@thesalesmasters.com.au PO BOX 638, Rosebery, NSW 2018

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_______________________________________________CPP40307 Certificate IV in Property Services (Real Estate)

Š Australian Salesmasters Training Co P/L (ASTC) ASTC believes that the content of these notes and checklists are accurate and current at the time of printing. ASTC does not make any warranty of any kind, what so ever expressed or implied, with respect to the contents. It is the responsibility of the real estate professional using the notes and checklist to verify any information before relying on it.

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_______________________________________________CPP40307 Certificate IV in Property Services (Real Estate)

Table of Contents Page No.

Element 1: SCREEN TENANT ENQUIRIES

7

Element 2: UNDERTAKE PROPERTY INSPECTION

42

Element 3: OBTAIN AND REVIEW TENANCY APPLICATION

54

Element 4: COMPLETE TENANCY DOCUMENTATION AND

65

PLACE TENANT IN PROPERTY

Element 5: RECORD TENANCY ARRANGEMENTS

90

CONCLUSION

95

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_______________________________________________CPP40307 Certificate IV in Property Services (Real Estate)

UNIT DESCRIPTOR This unit of competency specifies the outcomes required to administer the leasing of all types of property. It includes screening tenant enquiries, conducting inspections, obtaining and reviewing tenancy applications, completing tenancy agreements or lease documentation, placing tenants in property and recording tenancy arrangements.

The outcomes support the work of licensed real estate agents and real estate representatives involved in administering the leasing of all types of property.

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_______________________________________________CPP40307 Certificate IV in Property Services (Real Estate)

ELEMENT 1 SCREEN TENANT ENQUIRIES 1.1

Enquiries from potential tenants regarding lease of property are handled promptly to enable high quality service delivery in line with agency requirements.

1.2

Appropriate rapport is established with potential tenants.

1.3

Enquiries from potential tenants are screened to determine their preferences, needs, financial limits and capacity to pay and care for the property in line with agency practice and legislative requirements.

1.4

Factors likely to influence the lease of properties are identified and potential tenant intentions clarified.

1.5

Discussions with potential tenants are undertaken using promotional materials detailing agency rental arrangements and effective interpersonal communication techniques to identify and match stated requirements with known listings.

1.6

Strategies for assisting potential tenants to decide to view properties are implemented in line with agency practice, ethical standards and legislative requirements.

1.7

Areas of dispute are analysed and evaluated in line with agency practice and market expectations to enable resolution of dispute.

1.8

Agency records associated with prospective tenant enquiries are completed in line with agency practice.

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_______________________________________________CPP40307 Certificate IV in Property Services (Real Estate)

INTRODUCTION This unit outlines the duties and responsibilities of a property management team in the administration of the leasing of property. It does not cover the procedures and practices required to actually manage property, these skills underpin the unit CPPDSM4016A Monitor and manage lease or tenancy agreement.

As a member of a property management team, each individual is expected to have a clear understanding of agency procedures and practices. They also require current knowledge of the legislation and the marketplace that the property management department operates within to effectively lease property on behalf of the client.

HOW TO SCREEN YOUR TENANTS Blogger: Michael Gilbert, co-founder and director, Rent My Estate (http://www.smartpropertyinvestment.com.au)

When you are managing a rental property, especially if it is your own property, the most important thing you can do is find great tenants. This means screening your tenant applications-ruthlessly.

How do you get great tenants? It’s kind of like buying a boat (defined as “a hole in the water into which you throw money”). You can take the time to find a good deal on a good boat with a strong engine that will bring you home every time, or you can accept the one with a couple small leaks and think “at least it floats”. Which do you suppose is going to cost you more money and heartache in the long run?

It is tempting to accept the first tenants who fill out an application, especially if the property has been vacant for a while (“at least it floats”). However, unless you make the effort to carefully screen their application, who knows what kind of leaks, I mean problems, they will give you.

Find as Many Applicants as You Can Some owners and managers depend on luck to bring them great tenants, but I have found that luck has little to do with it. To get great tenants, you have to make the time and effort to find them. This means doing a good job of marketing the property so there are lots of applicants to choose from.

Simple logic tells us that if we have enough rental applications in hand, one of them is bound to be a good tenant. We can discuss some ways to get lots of potential tenants inspecting your property another time. For now, let’s just imagine that you have a decent pile of applications to select from.

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_______________________________________________CPP40307 Certificate IV in Property Services (Real Estate)

The screening process began when you met the applicants during the inspection. How they respect your property during the inspection is a good indicator of how they will during the tenancy. Be careful on that note, however. If your instinct tells you they were putting on a performance at the inspection, you’re probably right.

Don’t Start Checking an Application without Proof of Income and ID The application is essentially a series of questions whose answers you want to have about the people who will be moving into your property. The only way the answers are of value is if you take the time to verify them. Finding a great home is competitive enough that some tenants may not be completely truthful in their application.

This is one reason it is important to verify everything on the application when screening.

Ensure that they have given 100 points of ID and proof of income, preferably their three most recent payslips and/or a bank statement highlighting their income.

Important Questions to Ask References Your most important screening phone call will be to the property manager at the last place the tenants rented (and their previous place too). Ask how they were as tenants. Did they get the rent paid on time? (Feel free to ask for an email copy of their Tenant Ledger so that you can see the payments for yourself.) How well did they keep the home? Was the bond refunded in full?

Next, call the applicant's employer. You need to call to verify income, ask to speak with the applicant's supervisor and get their impressions. I believe good employees make great tenants. (One of my favourite questions to ask employers is whether they think the applicant will be working for them in six months time. If they say “I hope so!” I know I’m getting close.)

Many people think that the character references are merely a formality, but they can be a terrific tool to find out what kind of person your applicant associates themselves with. I believe a personal reference is as much about the person giving the reference as it is about the applicant. My favourite question to ask them is ‘If you had a rental property would you lease to them?’

The answer is always going to be yes, but listen closely. If there is some hesitation in the reply that’s a big worry. However, a cheerful genuine confirmation is a good sign.

The Final Screening Steps If the applicant has impressed me to this point, I like to make a check on the National Tenancy Database (or as I like to call it, the Naughty Tenants Database). The information from the NTD is not free, so I wait until I am almost ready to offer a lease. Up to this point the screening has only cost me time on the phone, so spending the money to confirm what I think I already know is well spent.

Before I accept an application and offer a lease, I want to go over everything and do a final gut check. If something does not feel right it probably isn’t. I’ve learned this the hard way!

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_______________________________________________CPP40307 Certificate IV in Property Services (Real Estate)

Screening applicants before they become tenants is not always fun. It is a bit of work to ask a lot of strangers’ personal questions about another stranger, but I find that the time I invest saves me ten times as much frustration down the line.

How to screen your tenants By YIP The current national rental market is generally in favour of landlords, with more tenants than properties pushing vacancy rates to historically low levels. But simply having a glut of tenants to choose from doesn't guarantee top-quality tenants. Sarah Megginson shows you how to find the best tenants for your investment property and explains what to do if you pick the wrong person.

There are no hard and fast rules to follow to find the 'best tenant' for your investment property.

Some landlords, for example, value stability and security in their investment, so they prefer leasing to families with school-aged children, as they tend to stay in one place for several years at a time.

Other investors, however, shy away from having small families tenant their properties, as they are wary of the potential damage to fixtures and fittings that children and pets can cause. These landlords are happy to forgo long-term security, therefore, in exchange for less wear-and-tear on their property.

Your 'ideal tenant' will depend on several personal and financial factors, says Elisa Woollard, co-director and property manager with Pacific Lifestyle Property - and her first piece of advice to landlords is to maintain an objective, unemotional view when deciding on their next tenant.

"I always recommend to our clients that they compose a checklist prior to looking for a tenant," Woollard says.

"That way, they know exactly what attributes they ideally require."

As a starting point, landlords should consider the length of tenancy and the desired number of people they wish to reside in the property, Woollard explains. Next, they should evaluate individual tenant concerns, such as their ability to provide a good tenant ledger/history and excellent references.

"The ideal tenants are those who provide can provide sufficient evidence of income, have the capacity to finance their rent, and have a responsible character," Woollard says.

"Essentially, they are people that you could trust to take care of the property, as if it was their own. The exact type of person would then vary according to locality."

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_______________________________________________CPP40307 Certificate IV in Property Services (Real Estate)

To attract premium tenants, Woollard suggests that investors ensure that the property is kept in a clean, comfortable and well-presented manner.

"Giving a good impression initially represents how the property is expected to be maintained," she explains.

"A fresh paint job is always a good idea if the property has signs of wear and tear and requires some freshening up."

Other considerate gestures include being flexible with inspection times, and ensuring that sufficient research has been carried out, in regards to the median rental prices in the area.

"This should be done before reaching a decision on rental price, to make certain that you do not price your property out of the market for your local area," she says.

Be mindful of the law As you filter through tenant applications to decide on the best possible tenants for your investment property, it is important to be mindful of all relevant federal and state antidiscrimination laws.

Under these laws, you cannot impose conditions on a tenancy if these conditions make it harder for people in particular groups to gain access to rental properties.

For example, according to the Real Estate Institute of Australia, when selecting tenants the only requirements that can be addressed are: • The number of people suitable to reside in the property • The tenant's ability to prove that they have and can maintain the weekly rent • The tenant's ability to prove that they have and can maintain a rental property in a clean and tidy condition Unfair discrimination happens if you treat a potential tenant less favourably because of their sex, age, race, nationality, marital status, the fact that they have children, sexual preferences, disability or impairment, pregnancy, religion or political beliefs.

However, you do have the right to choose the most suitable tenant, provided that no unfair discrimination occurs.

Both the property manager and the landlord are legally liable if complaints are made, and real estate agents cannot accept discriminatory direction from lessors - such as directions to not accept applications from people of a certain race.

The NSW Office of Fair Trading's 'Discrimination and Renting' publication explains that indirect discrimination is also unlawful.

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_______________________________________________CPP40307 Certificate IV in Property Services (Real Estate)

Indirect discrimination occurs when there is a requirement, such as a rule, policy or procedure, that is "the same for everyone, but which has an unequal or disproportionate effect on particular groups".

For example, a real estate agent might receive a number of applications from people wanting to rent the same property. The agent's policy might be to rank applications by the income of applicants. Since some people from Aboriginal backgrounds may earn less on average than others, this policy may result in indirect discrimination.

Instead, a fair selection process would be to rank people in order of when they lodged their application, and then assess the first application for their capacity to pay the rent and maintain the property.

The Rental Property Once a potential lessor (owner) of residential property has approached the real estate agency seeking to lease their investment property, the agency must decide whether or not to accept the property.

As the property manager you will need to investigate the owners’ motivation for requiring your services as well as the quality of the management being offered. Not all owners are seeking both leasing and management services from agents. Some more confident owners are merely requiring to enter into a contract with your agency to purely lease the property.

The owner themselves may then be keen to manage it, whether short or long term.

It is at this point that the property manager must correctly qualify the owner to determine the range of services required from you. As well as acting in the clients best interests you must remember to also consider the best interests of the agency.

Some agencies have a policy that excludes the service of just letting properties without the management of them. The agency is not obliged to enter into a contract with everyone who seeks the services of the agency.

As the property manager you will need to consider the location of the property and distance from the office, the long and short term needs of the owner and the quality of the management. After inspecting the property, the property manager will be able to comment on the standard of repair and management of the property in their Property Inspection Report. If they decide that the owner is not upholding their responsibility to maintain the property, provide it in a clean state and fit for habitation they may reject the opportunity to lease and/or manage the property. (Refer the Residential Tenancies Act 2010 section 25).

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_______________________________________________CPP40307 Certificate IV in Property Services (Real Estate)

If the property is rejected on the basis of location, e.g. it is too far from the office to benefit the owner and the agency you are obliged to inform the client of such and should refer the client to an agent who specialises in that particular location.

Once it is agreed that the agency will accept the lease and/or the management of the property, it should be inspected and the appropriate agency agreement be completed with the owner, either a Letting or Management Agency Agreement.

The Lessor (principal) The lessor is the registered proprietor or owner of the property who has authority to enter into an agency agreement with the agent. A property manager cannot act on behalf of a lessor until an agency agreement has been completed and served on the lessor.

Be mindful here of the legislation of the Property Stock and Business Agents Act 2002 section 55 requiring you to serve the agency agreement on your client within 48 hours. If this does not occur they may be in a position to avoid paying commission. The Regulations 2003 Schedule 2 Part 2 clause10 states that the next step is to inspect the property and provide an inspection report to the owner. Refer to this clause for the mandatory contents of this report.

It is at this point the property manager advises the owner as to the realistic market rent and a rental amount has to be agreed upon to begin advertising the property. A comparable analysis of properties and rents achieved for similar properties should be presented to the owner to assist them in agreeing on the market rent at which the property will be offered. Current economic trends, supply and demand of rental properties in the local market and vacancy rates are also impacting factors that you should consider and discuss with the owner.

The property manager also needs to inform the lessor of any repairs and maintenance that need to be undertaken prior to the commencement of a marketing campaign and occupancy by a tenant.

The Agency Agreement The Management Agency Agreement is designed to enable compliance with the Property, Stock and Business Agents Act 2002 and Regulations 2003. • • •

Schedule 7 applies to all agency agreements Schedule 12 applies to property management services in respect to leasing of residential property or rural land Schedule 13 applies to leasing of residential or rural land

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_______________________________________________CPP40307 Certificate IV in Property Services (Real Estate)

For the purposes of this unit ” Lease Property” schedule 13 outlines both the extent of the agents authority and details about the period of the tenancy, rent and bond. It is important that you are aware of the difference in the extent in your authority if you are only entering into a Letting Agency Agreement with your principal rather than a Managing Agency Agreement. The agency agreement is your contract with the principal, it informs the agent of the duties they are to undertake from the date of appointment and the remuneration the agency is to receive.

It is imperative that the agency agreement be correctly completed.

Failure to do so will: (a) prevent the agent from taking action to recover fees and expenses (b) enable a principal to recover all fees and expenses obtained by the agent (c) expose the agent to severe penalties for breaching the Act Residential Tenancy Agreement Often referred to as the “lease” the successful tenant must now complete this contract prior to occupancy, it binds both the tenant and landlord to the terms and conditions of this contract for the duration of the lease. It contains 2 parts: Part 1: The terms of the agreement Part 2: The condition report Part 1 contains the following: • Landlord name and ABN details • Tenants names • Address of premises • Number of persons permitted to occupy the premises • Rent amount and when due • How and where rent is to be paid • Term of the agreement- beginning and end dates • Rental Bond- amount to be paid There are 6 pages of clauses in the agreement, which should be read, by both the tenant and landlord so they are clear about their rights and responsibilities. The final page is signed by the agent (on behalf of the landlord) and by the tenant. A copy is then given to each tenant.

NOTE: The New Tenant Checklist from Fair Trading is on pages 15 to 17 The Residential Tenancy Agreement is on pages 18 to 28 Doc ID: CPPDSM4010A - Workbook (L) eLearning Date: 28/03/2018 Developed by: SL Version: 7 Approved by: CEO P a g e | 13 File Location: S:\Learning & Assessment Resources\Real Estate\CPP40307 Certificate IV in Property Services (Real Estate) NSW\Assessment Tools\13. CPPDSM4010A\CPPDSM4010A - Workbook (L) eLearning.doc

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New tenant checklist What you must know before you sign a lease This mandatory guide has been updated. Landlords and agents must give this guide to tenants before they enter into a new residential tenancy agreement with them. If the landlord or agent uses the January 2014 version of this guide, they must also give the tenant the Addendum to The New Tenant Checklist.

At the start of every tenancy you should be given the following by the landlord or agent: •

a copy of this information statement

•

a copy of your lease (tenancy agreement)

•

2 copies of the premises condition report (more on that later)

•

a bond lodgement form for you to sign, so that it can be lodged with NSW Fair Trading

•

keys to your new home.

The first thing you should do before you sign the lease is read it thoroughly. If there is anything in it which you don't understand, ask questions.

Remember, you are committing to a legally binding contract for which there is no cooling–off period.

You will want to be certain you understand and agree to what you are signing.

Only when you can respond with a Yes to the following statements, should you sign the lease.

The lease

I have read the lease and I asked questions if there were things I didn’t understand.

I know the length of the lease is negotiated before I sign, which means it can be for 6 months, 12 months, or some other period.

I know that I must be offered at least one way to pay the rent which does not involve paying a fee to a third party.

I know that any additional terms to the lease are negotiated before I sign.

I have checked that all additional terms to the lease are legal, for example, the lease does not include a term requiring me to have the carpet professionally cleaned when I leave, unless I have agreed to that as part of a condition to allow me to keep a pet on the premises.

Promised repairs In relation to any promises by the landlord or agent (for example, replace the oven, paint a room, clean up the backyard etc): I have made sure these have already been done, or I have an undertaking in writing (before signing the lease) that they will be done.

Upfront costs I am not being required to pay: more than 2 weeks rent in advance, unless I freely offer to pay more more than 4 weeks rent as a rental bond.

I am not being charged for: the cost of preparing my lease the initial supply of keys and security devices to each tenant named on the lease.

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Managing your bond online Before paying your rental bond, ask your agent or landlord about using Rental Bonds Online. If they are registered, you can securely pay your bond direct to NSW Fair Trading using a credit card or BPAY, without the need to fill out and sign the bond lodgement form referred to above. Once registered, you can continue to use your account for future tenancies.

Swimming and spa pools

Does the property have a swimming or spa pool? If so, the landlord must give you a copy of a valid certificate of compliance or occupation certificate issued in the past 3 years. This does not apply if you are renting in a strata or community scheme of more than two lots.

After you move in Make sure you: •

Fill in your part of the condition report and don’t forget to return a copy to the landlord or agent within 7 days. This is an important piece of evidence. If you don’t take the time to complete it accurately money could be taken out of your bond to pay for damage that was already there when you moved in.

•

Get a letter from Fair Trading sometime during the first 2 months saying that your bond has been received and advising you of your Rental Bond Number. If this doesn’t arrive call Fair Trading to make sure it has been lodged. If you have lodged your bond through Rental Bonds Online you will receive an email and SMS notification, not a letter.

Top tips for problem–free renting Follow these useful tips to help avoid problems while you are renting: •

Photos are a great way to record the condition of the property when you first move in. Take pictures (that are date stamped) of the property, especially areas that are damaged or unclean.

Keep these in case the landlord objects to returning your bond at the end of your tenancy.

•

Keep a copy of your lease, condition report, rent receipts, Rental Bond Number and copies of letters/emails you send or receive in a designated ‘tenancy’ file folder and put it somewhere you can easily find it later.

•

Never stop paying your rent, even if the landlord is not complying with their side of the agreement (eg. by failing to do repairs) – you could end up being evicted if you do.

•

Comply with the terms of your lease. In particular, never make any alterations, keep a pet or let other people move in without asking the landlord or agent for permission first.

•

Keep a diary of your dealings with the landlord or agent – record all the times and dates of conversations, who you spoke to and what they agreed to do. If repairs are needed, put your request in writing to the landlord or agent and keep a copy. This type of evidence is very helpful if a dispute arises which ends up in the NSW Civil and Administrative Tribunal.

•

Consider taking out home contents insurance. It will cover your belongings in case of theft, fires and natural disasters. The landlord’s building insurance, if they have it, will not cover your things.

•

If the property has a pool or garden be clear about what the landlord or agent expects you to do to maintain it.

•

Be careful with what you sign relating to your tenancy, and don't let anybody rush you. Never sign a blank form, such as a Claim for refund of bond.

•

If you are happy in the place and your lease ends, consider asking for the lease to be renewed for another fixed term. This will remove the worry about being unexpectedly asked to leave, and helps to lock in the rent for the next period of time.

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Further information Go to the Fair Trading website or call 13 32 20 for more information about your renting rights and responsibilities.

The NSW Government funds a range of community based Tenants Advice and Advocacy Services across NSW to provide advice, information and advocacy to tenants. Go to the Tenants Union website at www.tenants.org.au for details of your nearest service or check your local phone directory.

Landlords and agents must give a copy of this information statement to all new tenants before they sign a residential lease. Fines can be imposed if this is not done.

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Being a landlord When you rent out a home in NSW and become a 'landlord', knowing your rights and responsibilities will help you avoid or resolve differences you may have with your tenant.

In this section, you will find information to help you understand what the tenancy laws in NSW mean for you, at the beginning, middle or end of a tenancy.

Starting a tenancy During a tenancy Ending a tenancy

Information you must give new tenants Landlords and agents must provide tenants with a copy of the New tenant checklist before they sign a residential tenancy agreement. Fines can be imposed if this is not done. You can print copies of the New tenant checklist for free from the Fair Trading website.

Residential tenancy complaint service NSW tenants, landlords and property managers can use Fair Trading’s new tenancy complaint service to resolve selected residential tenancy complaints or disputes.

The free voluntary service provides a convenient alternative to having residential tenancy matters heard by the NSW Civil and Administrative Tribunal (NCAT). An experienced Fair Trading Officer will aim to finalise the complaint through mutual agreement.

If Fair Trading cannot get the parties to agree to a resolution, either party may lodge a claim with NCAT. Learn more about this free service and whether Fair Trading can look into your matter on the Residential tenancy complaint service page on the Fair Trading website or call our 13 32 20 hotline with your tenancy questions.

Rental Bonds Online In July 2015 NSW Fair Trading introduced Rental Bonds Online (RBO), a new service to lodge, manage and refund rental bonds. You can find out more on RBO by visiting the Rental Bonds Online for private landlords web page. Further information is also included on our Frequently asked questions for private landlords web page.

Related information •

Subscribe to the free tenancy enewsletter service, The Letterbox

•

Watch a video on renting out your investment property

•

Watch a video on real estate agents' responsibilities to landlords

•

Residential tenancy forms To view or download the standard tenancy agreement and condition report

•

Residential Tenancies Act 2010

•

Residential Tenancies Regulation 2010

Get a free copy of Adobe Acrobat Reader so you can access PDF versions of our information.

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For information about your rights and responsibilities under this agreement, contact Fair Trading at www.fairtrading.nsw.gov.au or call 13 32 20.

The Agreement 1. The landlord agrees to give the tenant: 1.1 a copy of this agreement at or before the time the agreement is signed and given by the tenant to the landlord or a person on the landlord’s behalf, and 1.2 a copy of the agreement signed by both the landlord and the tenant as soon as reasonably practicable.

Rent 2. The tenant agrees to pay rent on time.

3. The landlord agrees to provide a receipt for any rent paid to the landlord or to ensure that the landlord’s agent provides a receipt for any rent paid to the agent. If the rent is not paid in person, the landlord agrees only to make the receipt available for collection by the tenant or to post it to the tenant. (The landlord is not required to provide or make available a receipt if rent is paid into the landlord’s account.)

Payment of council rates, land tax, water and other charges 4.

The landlord agrees to pay:

4.1 Council rates, and 4.2 for water, other than water that the tenant has agreed to pay for under clauses 5.3 and 5.4 of this agreement, and 4.3 land taxes, and 4.4 the cost of installing any meters to measure the supply of water, electricity or gas, and 4.5 charges under any other Act for the residential premises.

5. The tenant agrees to pay: 5.1 5.2 5.3 5.4

for electricity, and for gas, and for excess water, and any other charge for water set out in the additional terms of this agreement if the charge for water is calculated according to the metered amount of water consumed and there is no minimum rate chargeable, and 5.5 any excess garbage or sanitary charges, and 5.6 any charges for pumping out a septic system.

Possession of the Premises 6.

The landlord agrees:

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6.2 there is no legal reason that the landlord knows about, or should know about when signing this agreement, why the premises cannot be used as a residence for the term of this agreement.

Tenant’s right to quiet enjoyment 7. The landlord agrees: 7.1 that the tenant will have quiet enjoyment of the residential premises without interruption by the landlord or any person claiming by, through or under the landlord or having superior title to that of the landlord, and 7.2 that the landlord or the landlord’s agent will not interfere, or cause or permit any interference, with the reasonable peace, comfort or privacy of the tenant in using the premises.

Use of the premises 8. The tenant agrees: 8.1 not to use the residential premises, or cause or permit the premises to be used, for any illegal purpose, and 8.2 not to cause or permit a nuisance, and 8.3 not to interfere, or cause or permit interference, with the reasonable peace, comfort or privacy of neighbours.

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Landlord’s access to the premises 9.

The landlord, the landlord’s agent or any person authorised in writing by the landlord, during the currency of this agreement, may only enter the residential premises in the following circumstances: 9.1 9.2 9.3 9.4 9.5 9.6 9.7

9.8 9.9 10.

in an emergency (including entry for the purpose of carrying out urgent repairs), or if the Consumer, Trader and Tenancy Tribunal so orders, or if there is good reason for the landlord to believe the premises are abandoned, or to inspect the premises, if the tenant gets 7 days’ notice (no more than 4 inspections are allowed in any period of 12 months), or to carry out necessary repairs, if the tenant gets 2 days’ notice on each occasion, or to show the premises to prospective buyers or mortgagees on a reasonable number of occasions, if the tenant gets reasonable notice on each occasion, or to show the premises to prospective tenants on a reasonable number of occasions if the tenant gets reasonable notice on each occasion (this is only allowed during the last 14 days of the agreement), or to install a smoke alarm or replace a battery in a smoke alarm in the residential premises, if the tenant gets 2 days’ notice on each occasion, or if the tenant agrees.

If a person has power to enter the residential premises under clause 9.4, 9.5, 9.6 or 9.7 of this agreement the person:

10.1 must not enter the premises on a Sunday or a public holiday, unless the tenant agrees, and 10.2 may enter the premises only between the hours of 8.00 a.m. and 8.00 p.m., unless the tenant agrees to another time.

11. Except in an emergency (including to carry out urgent repairs), a person other than the landlord or the landlord’s agent must produce to the tenant the landlord’s or the landlord’s agent’s written permission to enter the residential premises.

Cleanliness, repairs and damage to the premises 12. The landlord agrees: 12.1 to make sure the residential premises are reasonably clean and fit to live in, and 12.2 to keep the premises in reasonable repair, considering the age of, the amount of rent paid for and the prospective life of the premises.

13. The tenant agrees: 13.1 to keep the residential premises reasonably clean, and 13.2 to notify the landlord as soon as practicable of any damage to the premises, and 13.3 not to intentionally or negligently cause or permit any damage to the premises, and 13.4 when the agreement ends, to leave the premises as nearly as possible in the same condition (fair wear and tear excepted) as set out in the condition report for the residential premises that forms part of this agreement.

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Note. The condition report that forms part of this agreement is the condition report set out in Part 2 of this agreement unless: (a) the agreement is a renewed agreement, and (b) the landlord and tenant have agreed that clause 28 of this agreement applies, and (c) a date has been inserted in clause 28, in which case the specified earlier agreement forms part of this agreement.

Alterations and additions to the premises 14. The tenant agrees: 14.1 not to attach any fixture or renovate, alter or add to the residential premises without the landlord’s written permission, and 14.2 not to remove, without the landlord’s written permission, any fixture attached by the tenant, and 14.3 to notify the landlord of any damage caused by removing any fixture attached by the tenant, and 14.4 to repair any damage caused by removing the fixture or compensate the landlord for the cost of repair, if the landlord asks.

15.

The landlord agrees to compensate the tenant as soon as possible for the value of a fixture attached by the tenant if the landlord refuses to allow its removal.

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Urgent repairs 16.

The landlord agrees to pay the tenant, within 14 days after receiving written notice from the tenant, any reasonable costs (not exceeding $1,000) the tenant has incurred for making urgent repairs (of the type set out below) so long as: 16.1 the damage was not caused as a result of a breach of this agreement by the tenant, and 16.2 the tenant gives or makes a reasonable attempt to give the landlord notice of the damage, and 16.3 the tenant gives the landlord a reasonable opportunity to make the repairs, and 16.4 the tenant makes a reasonable attempt to have any appropriate tradesperson named in this agreement make the repairs, and 16.5 the repairs are carried out, where appropriate, by licensed or properly qualified persons, and 16.6 the tenant as soon as possible gives or tries to give the landlord written details of the repairs, including the cost and the receipts for anything the tenant pays for.

17. The type of urgent repairs to the residential premises for which the landlord agrees to make payment are repairs to: 17.1 17.2 17.3 17.4 17.5 17.6 17.7 17.8 17.9

a burst water service, or a blocked or broken lavatory system, or a serious roof leak, or a gas leak, or a dangerous electrical fault, or flooding or serious flood damage, or serious storm or fire damage, or a failure or breakdown of the gas, electricity or water supply to the premises, or a failure or breakdown of any essential service on the premises for hot water, cooking, heating or laundering, or 17.10 any fault or damage that causes the premises to be unsafe or not secure.

Tradesperson/s: For information about your rights and responsibilities under this agreement, contact Fair Trading at www.fairtrading.nsw.gov.au or call 13 32 20.

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Locks and security devices 18. The landlord agrees: 18.1 18.2

18.3

19.

to provide and maintain locks or other security devices necessary to keep the residential premises reasonably secure, and not to alter, remove or add any lock or other security device without reasonable excuse (which includes an emergency or an order of the Consumer, Trader and Tenancy Tribunal) unless the tenant agrees, and to give the tenant a copy of the key or opening device or information to open any lock or security device which is added or altered, except where the tenant agrees not to be given a copy or the Tribunal so orders.

The tenant agrees:

19.1

not to alter, remove or add any lock or other security device without reasonable excuse (which includes an emergency or an order of the Consumer, Trader and Tenancy Tribunal) unless the landlord agrees, and 19.2 to give the landlord a copy of the key or opening device or information to open any lock or security device which is altered or added, except where the landlord agrees not to be given a copy or the Tribunal so orders.

Smoke alarms 19A. The landlord agrees: 19A.1 to install any smoke alarms that are required by law to be installed on the residential premises, and 19A.2 not to remove or interfere with the operation of any such smoke alarm except with reasonable excuse, and 19A.3 if any such smoke alarm has a replaceable battery (other than a back up battery), to ensure that a new battery is installed in the smoke alarm at the beginning of the term of this agreement and, if the battery needs to be replaced at any time, and the tenant is physically unable to change the battery, to replace the battery with a new battery as soon as reasonably practicable after being notified that the battery needs to be replaced.

19B. The tenant agrees: 19B.1 not to remove or interfere with the operation of any smoke alarm installed on the residential premises except with reasonable excuse, and 19B.2 if any such smoke alarm has a replaceable battery (other than a back up battery), to ensure that the battery is replaced whenever necessary or, if the tenant is physically unable to change the battery, to notify the landlord as soon as reasonably practicable after becoming aware that the battery needs to be replaced, and 19B.3 to notify the landlord if any smoke alarm installed on the residential premises is not functioning properly.

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Tenant’s responsibility for the actions of others 20. The tenant agrees to be responsible to the landlord for any act or omission by any person the tenant allows on the residential premises who breaks any of the terms of the agreement.

Right to assign or sub-let 21. A tenant may with the landlord’s prior permission assign the whole or part of the tenant’s interest under this agreement or sub-let the residential premises.

22. The landlord agrees not to charge for giving permission other than for the landlord’s reasonable expenses in giving permission.

For information about your rights and responsibilities under this agreement, contact Fair Trading at www.fairtrading.nsw.gov.au or call 13 32 20.

Landlord’s change of address 23. The landlord agrees: 23.1 if the address of the landlord changes (and the landlord does not have an agent), to give the tenant notice in writing of the change within 14 days, and 23.2 if the name or business address of the landlord’s agent changes or the landlord appoints an agent, to give the tenant notice in writing of the change or the agent’s name or business address, as appropriate, within 14 days, and 23.3 if the landlord or landlord’s agent is a corporation and the name of the secretary or other responsible agent of the corporation changes or the address of the registered office of the corporation changes, to give the tenant notice in writing of the change within 14 days.

Change of address of certain tenants 24. The tenant (who is a corporation other than a statutory corporation) agrees, if the address of the registered office of the tenant changes, to give the landlord notice in writing of the changed address.

Copy of certain by-laws to be provided 25. The landlord agrees to give to the tenant within 7 days of entering into this agreement a copy of the by-laws applying to the residential premises if they are premises under the Strata Schemes Management Act 1996, the Strata Schemes (Leasehold Development) Act 1986, the Community Land Development Act 1989 or the Community Land Management Act 1989.

Mitigation of loss 26. The rules of law relating to mitigation of loss or damage on breach of a contract apply to a breach of this agreement. (For example, if the tenant breaches this agreement the landlord will not be able to claim damages for loss which could have been avoided by reasonable effort by the landlord.)

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Rental bond 27. The landlord agrees that where the landlord or the landlord’s agent applies to the Rental Bond Board or the Consumer, Trader and Tenancy Tribunal for payment of the whole or part of the rental bond to the landlord, then the landlord or the landlord’s agent will provide the tenant with details of the amount claimed and with copies of any quotations, accounts and receipts that are relevant to the claim.

Agreement to use previous condition report 28. The landlord and tenant agree that the condition report included in a residential tenancy agreement entered into by the tenant and dated [insert ] a date if the landlord and tenant agree to this clause] forms part of this agreement.

Additional terms Additional terms may be included in this agreement if: (a) both the landlord and tenant agree to the terms, and (b) they do not conflict with the Residential Tenancies Act 2010 or any other Act, and (c) they do not conflict with the standard terms of this agreement.

ANY ADDITIONAL TERMS ARE NOT REQUIRED BY LAW AND ARE NEGOTIABLE. Additional term about water [Cross out this clause if it is not applicable] 29. The tenant agrees to pay for all water used during the term of the agreement (in addition to any excess water for which the tenant has agreed to pay under clause 5.3 where the charge for the water is calculated according to the metered amount of water consumed and there is no minimum rate chargeable.

For information about your rights and responsibilities under this agreement, contact Fair Trading at www.fairtrading.nsw.gov.au or call 13 32 20.

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Notes 1. Definitions In this agreement: “landlord” means the person who grants the right to occupy residential premises under this agreement, and includes the person’s heirs, executors, administrators and assigns, “landlord’s agent” means a person who acts as the agent of the landlord and who (whether or not the person carries on any other business) carries on business as an agent for: (a) the letting of residential premises, or (b) the collection of rents payable for any tenancy of residential premises, “regulations” means regulations under the Residential Tenancies Act 2010, “rental bond” means money paid by the tenant as security to carry out this agreement, “residential premises” means any premises or part of premises (including any land occupied with the premises) used or intended to be used as a place of residence, “tenancy” means the right to occupy residential premises under this agreement, “tenant” means the person who has the right to occupy residential premises under this agreement, and includes the person’s heirs, executors, administrators and assigns.

2. Notes on ending the tenancy The first step to end a tenancy is, almost always, for the landlord or the tenant to give a notice of termination. The tenancy ends when the tenant moves out, on or after the day specified in the notice, or when the Consumer, Trader and Tenancy Tribunal orders the tenancy to end.

3. Notices of termination (1) A notice of termination must: (a) be in writing, and (b) state the address of the rented premises, and (c) be signed and dated, and (d) allow the required period of time, and (e) give the date the tenant intends to, or is requested to, move out on, and (f) give the reasons for ending the agreement (if any), and (g) be properly given.

(2)

If the notice is given by or on behalf of a landlord, the notice must state that “information about the tenant’s rights and obligations can be found in the residential tenancy agreement”.

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For information about your rights and responsibilities under this agreement, contact Fair Trading at www.fairtrading.nsw.gov.au or call 13 32 20.

4. How notices are properly given (1) A notice of termination given to a tenant may be: (a) posted to the tenant’s home, or (b) given to the tenant personally, or (c) given to a person aged over 16 who normally pays the rent, or (d) given to a person aged over 16 at the premises to pass on to the tenant.

(2)

A notice of termination given to a landlord may be: (a) posted to the landlord’s address, or (b) given to the landlord (or to the landlord’s agent) personally, or (c) posted or faxed to the landlord’s agent’s place of business, or (d) given to a person aged over 16 who normally collects the rent.

5. When and how much notice can be given?

(1)

When and how much notice can be given depends on the type of residential tenancy agreement and the reasons for giving notice.

(2)

There are 2 types of agreements; “fixed term agreements” and “continuing agreements”: (a) a “fixed term agreement” is one that is for a specified period of time and ends on a specified date. If the date this agreement is due to end (see page 1 of this agreement) has not passed you are still on a fixed term agreement, and (b) a “continuing agreement” does not end on a specified date. These agreements usually begin when a fixed term agreement expires and a new one is not entered into, although an agreement can be a continuing one from the beginning.

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6. How to end a fixed term agreement A fixed term agreement may be ended for the following reasons, provided that at least 14 days’ notice is given: (a) if the tenant breaks one of the agreement’s terms, (b) if the tenant is more than 14 days in arrears of rent, (c) if the landlord breaks one of the agreement’s terms, (d) if the landlord or tenant want to end the tenancy at the end of a fixed term agreement (in which case, notice can be given until the final day of the fixed term period, otherwise the agreement becomes a continuing agreement).

7. How to end a continuing agreement (1) Unlike fixed term agreements, the amount of notice that a tenant or a landlord must give to end a continuing agreement is not always the same.

(2)

A continuing agreement may be ended by a landlord in the following ways: (a) without stating a reason (in which case at least 60 days’ notice must be given), (b) on exchange of a sale contract that requires vacant possession of the rented premises (in which case at least 30 days’ notice must be given), (c) if the tenant breaks one of the agreement’s terms or is more than 14 days in arrears of rent (in which case at least 14 days’ notice must be given).

(3)

A continuing agreement may be ended by a tenant:

(a) without reason (in which case at least 21 days’ notice must be given), or (b) if the landlord breaks one of the agreement’s terms (in which case at least 14 days’ notice must be given).

For information about your rights and responsibilities under this agreement, contact Fair Trading at www.fairtrading.nsw.gov.au or call 13 32 20.

8. Vacant possession A notice of termination does not end the tenancy by itself. The tenant must return vacant possession of the premises to the landlord, on or after the day specified in the notice, for the tenancy to end. An application may be made to the Consumer, Trader and Tenancy Tribunal if the tenant does not vacate when required.

9. Warning It is an offence for any person to obtain possession of the premises without an order of the Consumer, Trader and Tenancy Tribunal if the tenant does not willingly move out. Fines and compensation can be ordered by a court in relation to such offences.

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10. Rent increases (1) The landlord cannot increase the rent during the fixed term unless the agreement sets out the amount of the increase or the method of calculating the amount of the rent increase.

(2)

The tenant must get 60 days’ notice in writing if the landlord wants to increase the rent.

This applies even when the agreement provides for, or permits, a rent increase. Where a notice of an increase has been given and the landlord and tenant subsequently agree to a lesser increase than in the notice, the landlord does not need to give a further 60 days’ notice.

(3)

The tenant can apply to the Consumer, Trader and Tenancy Tribunal within 30 days of getting the notice of the rent increase for an order that the rent increase is excessive, having regard to the general market level of rents for similar premises in similar locations.

(4)

If the landlord has reduced or withdrawn any goods, services or facilities, the tenant can at any time apply to the Tribunal for an order that the rent is excessive.

The landlord and tenant enter into this agreement (which includes the condition report) and agree to all its terms.

Signed by the landlord in the presence of [Name of witness] ________________________________________________________________ [Signature of landlord]: _______________________________________________________________ [Signature of witness]: ________________________________________________________________ Signed by the tenant in the presence of [Name of witness] ________________________________________________________________ [Signature of tenant]: _________________________________________________________________ [Signature of witness]: ________________________________________________________________ The tenant acknowledges that, at or before the time of signing this residential tenancy agreement, the tenant was given a copy of the Renting guide: Your basic rights and responsibilities as a tenant, as published by the NSW Office of Fair Trading.

[Signature of tenant]: _________________________________________________________________

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ELEMENT 2 UNDERTAKE PROPERTY INSPECTION 2.1

Appointments are made for property inspections in line with agency practice, ethical standards and legislative requirements.

2.2

Preparations are made for property inspection in line with agency practice.

2.3

Procedure for property inspections, including key control, orientation of prospective tenant to property and strategies for ensuring security of managed property, is implemented in line with agency practice.

2.4

Effective questioning techniques are used to clarify prospective tenant’s interest in the property.

2.5

Agency documentation associated with inspections is completed in line with agency practice and legislative requirements.

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THE CONDITION REPORT When leasing property, the property should be inspected, preferably in the presence of the lessor and any defects of the property should be noted. The legislation requires the property manager to conduct an initial inspection and to complete an initial condition report on the property. This report should be held in a file pertaining to that property.

The condition report describes the property prior to the tenant taking occupation of the premises. It is essential that the initial report is thorough with absolute attention to detail. These comments and any other notes may be required as evidence at a tribunal hearing if there is a dispute between the tenant and landlord, further down the track.

If the principal requires the property manager to manage the property, the property should also be inspected at least once during the term of the tenancy and at the end of the tenancy. It is crucial that the final inspection is completed in order that the Rental Bond is released to the tenant and any damages caused by the tenant be paid for.

Section 24 of the Residential Tenancies Act 2010 specifies that the property can be inspected no more than four times in 12 months. The condition report will be discussed in more detail later in the unit under “Tenancy Documentation�.

Routine Inspections These are pivotal to the physical management of the property. The property manager must inspect the premises at least annually and up to a maximum of 4 times per year and report on the general maintenance of the property, recommending any repairs to the landlord. A copy of the on-going condition report is sent to the landlord.

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Tenancy Checklist

Tenants All prospective occupants each complete an Application for Tenancy

Are accompanied by the agent on all inspections

Complete

the

Residential

Each is given equal opportunity

No keys are handed to prospective tenants

Tenancy Take time to sit down with tenants and explain

Agreement with tenants.

Ensure tenants complete the condition report and return within 7 days

the terms and conditions

Explain tenants responsibilities

Report any damage or repair promptly

Tenants to place report in writing to agent

Given the right to quiet enjoyment

Give legislated notice prior to inspection

Provided with notice if in arrears with rent

Agent to monitor arrears weekly

Do not use bond to supplement final 4 Tenant informed about responsibility to pay weeks rent

rent until date of vacating

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Landlords Uphold their obligations regarding repair Property manager explains this and provides a and maintenance of the property

copy of the “Renting Guide�

Maximum 4 inspections per year is upheld, do

Do not door knock tenants

not door knock tenants.

Account to landlord in accordance with Net rent is forwarded to landlord as per agency their contract

agreement e.g. fortnightly

Property manager provided with annual Recommendations are provided to maximise market appraisals

rent return

Only licensed trades people to conduct Landlords are advised against their own handy any repair/maintenance

work Landlords

Do not discriminate against tenants

cannot

expect

the

agent

to

discriminate on certain grounds of the Anti Discrimination Act 1977

Must hold required insurances over the Property property, e.g. fire theft, public liability Appropriate

disclosures

made

landlord

Landlord files secure and confidential

manager

annually

checks

that

insurances are current to

Beneficial interest received by agency disclosed

Property manager maintains files in lockable fireproof cabinet, backs up soft copy files daily.

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Residential Tenancy Agreement Part 2: Condition report How to complete this report 1. Three copies of this condition report are filled out and signed by the landlord or the landlord’s agent.

2. The landlord or the landlord’s agent record the condition of the residential premises by indicating whether the particular room item is clean, undamaged and working by placing “Y” (YES) or “N” (NO) in the appropriate column (see example below).

3. Two copies of the report which have been filled in and signed by the landlord or the landlord’s agent are given to the tenant at or before the time of entering into the agreement. The landlord keeps the third copy.

4. The tenant indicates agreement or disagreement with the condition indicated by the landlord or landlord’s agent by placing “Y” (YES) or “N” (NO) in the appropriate columns (see example below).

5. The tenant returns one copy of the completed condition report to the landlord or landlord’s agent and keeps the second copy.

6. At, or as soon as practicable after, the termination of a residential tenancy agreement, both the landlord and tenant should complete the copy of the condition report that they retained, indicating the condition of the premises at the end of the tenancy. This should be done in the presence of the other party, unless the other party has been given a reasonable opportunity to be present and has not attended the inspection.

Important notes about this report 1.

This condition report is an important record of the condition of the premises when the tenancy begins.

2.

At the end of the tenancy the premises will be inspected and the condition of the premises at that time will be compared to that stated in the original condition report.

3.

It is important to complete the condition report accurately. It may be vital if there is a dispute, particularly about the return of the rental bond money and any damage to the premises.

4.

If the tenant disagrees with the landlord’s condition report this must be confirmed in writing, preferably on the condition report, either by placing “N” (NO) in the appropriate column and by making an appropriate comment alongside that column.

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5.

The Consumer, Trader and Tenancy Tribunal has the power to hear disputes about the validity of a condition report.

Sample condition report www.fairtrading.nsw.gov.au Clean Undamaged Working Tenant agrees Condition of premises at START of tenancy Where to go for help when you are renting 1. The Office of Fair Trading looks after your bond money and manages the renting laws that cover this tenancy agreement. If you have any questions about your rights and responsibilities under this agreement, contact Fair Trading at www.fairtrading.nsw.gov.au or call 13 32 20. Language assistance on 13 14 50 (ask for an interpreter in your language) TTY 1300 723 404.

2. Your real estate agent or landlord (write contact number here): ________________________________ 3. Tenants Advice and Advocacy Service at www.tenants.org.au or call 1800 000 000.

Comments ENTRANCE walls/ceiling Y Y N Crack in wall over door

LOUNGE

doors/windows/screens

Y

N

Y

blinds/curtains

Y

N

Y

lights/power points floor/coverings

Y N

Y Y

Y Y

other walls/ceiling

Y

Y

Y

Y

Y

Y Y

Y Y Y

Y

Y Y

doors/windows/screens blinds/curtains lights/power points floor/coverings television points

Y Y

window screen torn cord broken, no curtains Y carpet stain near window

Y no curtains light shade cracked

Y Y

Y

Y ?

Y

unable to test (working)

heating other Doc ID: CPPDSM4010A - Workbook (L) eLearning Date: 28/03/2018 Developed by: SL Version: 7 Approved by: CEO P a g e | 46 File Location: S:\Learning & Assessment Resources\Real Estate\CPP40307 Certificate IV in Property Services (Real Estate) NSW\Assessment Tools\13. CPPDSM4010A\CPPDSM4010A - Workbook (L) eLearning.doc

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Clean Undamaged Working Tenant agrees Clean Undamaged Working Tenant agrees START OF TENANCY RESIDENTIAL TENANCY AGREEMENT PART 2: CONDITION REPORT Address of premises: ________________________________________________________________________ Condition of premises at START of tenancy Comments ENTRANCE walls/ceiling

LOUNGE

doors/windows/screens blinds/curtains lights/power points floor/coverings other walls/ceiling doors/windows/screens blinds/curtains lights/power points floor/coverings television points heating

DINING

other walls/ceiling doors/windows/screens blinds/curtains lights/power points floor/coverings television points heating

BEDROOM 3

walls/ceiling

OTHER ROOM

doors/windows/screens blinds/curtains lights/power points floor/coverings other walls/ceiling

BATHROOM

doors/windows/screens blinds/curtains lights/power points floor/coverings other walls/ceiling doors/windows/screens blinds/curtains lights/power points floor/coverings bath shower shower screen wash basin

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KITCHEN

other walls/ceiling

tiling mirror/cabinet

doors/windows/screens blinds/curtains lights/power points floor/coverings cupboards/drawers bench tops/tiling sink/disposal unit taps stove top griller oven

towel rails toilet/w.c. heating other walls/ceiling doors/windows/screens blinds/curtains lights/power points floor/coverings wash tubs copper/washing machine

refrigerator exhaust fan other BEDROOM 1

BEDROOM 2

walls/ceiling doors/windows/screens blinds/curtains lights/power points floor/coverings other walls/ceiling doors/windows/screens blinds/curtains lights/power points floor/coverings other

LAUNDRY

GENERAL

dryer hot water service store room/shed balcony/porch garage/car port gates/fences grounds/garden doors staircases letter box street number concrete paving security system smoke alarms other

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WATER METER READING: ________________________ FURNITURE: (See attached list) Landlord/agent’s signature: ______________________________________________ Tenant’s signature: ______________________________________________Date:___________________ LANDLORD’S PROMISE TO UNDERTAKE WORK [Delete if not required] The landlord agrees to undertake the following cleaning, repairs, additions or other work during the tenancy: _________________________________________________ ______________________________________________________________________ The landlord agrees to complete that work by: ________________________________ Landlord/agent’s signature: _______________________________________________ Tenant’s signature: _____________________________________________Date:_____________________ Note. Further items and comments may be added on a separate sheet signed by the landlord/agent and the tenant and attached to this report.

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Clean Undamaged Working Tenant agrees Clean Undamaged Working Tenant agrees END OF TENANCY RESIDENTIAL TENANCY AGREEMENT PART 2: CONDITION REPORT Address of premises: ________________________________________________________________________ ________________________________________________________________________ Condition of premises at END of tenancy Condition of premises at END of tenancy Comments Comments ENTRANCE

LOUNGE

walls/ceiling doors/windows/screens blinds/curtains lights/power points floor/coverings other walls/ceiling doors/windows/screens blinds/curtains lights/power points floor/coverings television points heating other

BEDROOM 3

OTHER ROOM

BATHROOM

walls/ceiling doors/windows/screens blinds/curtains lights/power points floor/coverings other walls/ceiling doors/windows/screens blinds/curtains lights/power points floor/coverings other walls/ceiling doors/windows/screens

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DINING

KITCHEN

BEDROOM 1

BEDROOM 2

walls/ceiling doors/windows/screens blinds/curtains lights/power points floor/coverings television points heating other walls/ceiling doors/windows/screens blinds/curtains lights/power points floor/coverings cupboards/drawers bench tops/tiling sink/disposal unit taps stove top griller oven refrigerator exhaust fan other walls/ceiling doors/windows/screens blinds/curtains lights/power points floor/coverings other walls/ceiling doors/windows/screens blinds/curtains lights/power points floor/coverings other

LAUNDRY

GENERAL

blinds/curtains lights/power points floor/coverings bath shower shower screen wash basin tiling mirror/cabinet towel rails toilet/w.c. heating other walls/ceiling doors/windows/screens blinds/curtains lights/power points floor/coverings wash tubs copper/washing machine dryer hot water service store room/shed balcony/porch garage/car port gates/fences grounds/garden doors staircases letter box street number concrete paving security system smoke alarms other

WATER METER READING: ___________________________ Landlord/agent’s signature:_________________________________________________ Tenant’s signature:______________________________________Date:_____________ Doc ID: CPPDSM4010A - Workbook (L) eLearning Date: 28/03/2018 Developed by: SL Version: 7 Approved by: CEO P a g e | 51 File Location: S:\Learning & Assessment Resources\Real Estate\CPP40307 Certificate IV in Property Services (Real Estate) NSW\Assessment Tools\13. CPPDSM4010A\CPPDSM4010A - Workbook (L) eLearning.doc

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ELEMENT 3 OBTAIN AND REVIEW TENANCY APPLICATIONS 3.1

Tenancy applications are reviewed to ensure that they have been completed in a full and accurate manner, consistent with legislative requirements and agency practice.

3.2

Applicants’ references are checked and results recorded according to legislative requirements, ethical standards and agency practice.

3.3

Application processes are reviewed to ensure compliance with ethical standards and legislative requirements.

3.4

Procedures for gaining landlord approval for tenancy are implemented in line with legislative requirements, ethical standards and agency practice.

3.5

Effective negotiation techniques are used to persuade and reach agreement between landlord and tenant on terms of tenancy agreement or lease.

3.6

Selected and unsuccessful applicants are notified and details are recorded in agency systems.

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Marketing and Promotion The agency agreement outlines the nature of advertising to be conducted on the property to attract a suitable tenant. An advertising expenditure and budget agreed upon by agent and principal should be planned and implemented to assist in leasing the property. An experienced property manager will be able to guide the principal as to what type of advertising has the most success for attracting the particular target market for the property.

A list of prospective tenants is normally held in the Real Estate Agent’s office. This list should be accessed immediately the property is placed on the market. Prospective tenants need to be contacted and an appointment to inspect the premises made to suit both the tenant and agent.

Subject to the marketing campaign approved by the owner, the property can be advertised in the local and/or weekend newspaper and perhaps a signboard erected at the front of the property. The window display at the agent’s office normally contains a section allocated to rental property and this should be updated at regularly. A brochure could also be produced, and the property be promoted on the Internet through sites such as www.domain.com.au, property.com.au or through your office web site.

A signboard will act as a twenty-four hour agent. It should be erected at the front of the property or wherever it will enjoy the greatest exposure, in line with local council regulations and by-laws. It assists local residents in identifying what is available for rental in their locality and they may then inform friends or relatives, who may be looking to accommodate themselves nearby. The sign also represents to the neighbourhood the extent of the agencies strength in real estate services.

The strikes/enquiry from all marketing and promotion should be monitored by the agency to determine the most successful and suitable form of advertising for various properties.

You should never place an advertisement in the paper and forget about it. Correct operation of the agency’s enquiry register will indicate if the advert did not bring in the enquiry and those ads that did work. The manager of the property management department may utilize this information to make any necessary adjustments to your office’s advertising campaigns. This serves to act in the best interests of your client. A new marketing strategy may have to be negotiated with the owner. It is in the interest of the lessor and the agent to successfully lease the property in the shortest time possible.

It is essential that communications between the lessor and the agent be noted in the file for the property. The agent must communicate all offers on the property and advise Doc ID: CPPDSM4010A - Workbook (L) eLearning Date: 28/03/2018 Developed by: SL Version: 7 Approved by: CEO P a g e | 53 File Location: S:\Learning & Assessment Resources\Real Estate\CPP40307 Certificate IV in Property Services (Real Estate) NSW\Assessment Tools\13. CPPDSM4010A\CPPDSM4010A - Workbook (L) eLearning.doc

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the lessor on market conditions. If the property remains vacant for a longer that expected period, it may be that the asking rent is higher than the market is prepared to pay.

The property manager has a “Duty of Care” to act in the principal’s best interest. The agent must inform the lessor that in their opinion the rent should be reduced or an incentive such as a rent free period be introduced to entice a prospective tenant to the property. This should be done in accordance with market conditions at the time.

Selection of Tenants After placement of the ads, the next stage will be to receive tenant enquiries about the property and arrange inspections of the property by the prospective tenants with the agent.

Once a prospective tenant has been sourced from the advertising, the property manager must obtain particulars from the tenant to ascertain their suitability for the property.

The 2 main criteria that the property manager must determine of the tenant are; 1)

The tenant’s ability to pay rent, and

2)

The tenant’s ability to maintain the premises.

To assist the property manager to do this the tenants are screened. The tenant must complete a “Tenancy Application Form”, the property manager will then review the applications received for the property to ensure completeness and accuracy of the information provided by the applicant.

It is imperative that the agent be aware of the legislation from the Anti-Discrimination Act 1977 when offering premises for lease. The property manager cannot discriminate (that is treat them unfairly compared to others or harass them) on the grounds of: • • • • • • • • •

Race Sex Pregnancy Marital status Physical impairment Mental impairment Sexual preference Age Transgender.

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Anti-discrimination Act 1977 (NSW) The purpose of this Act is to make discrimination unlawful upon certain grounds and give remedy to those persons discriminated against. This means that fines can be imposed and legal action taken against those who discriminate.

What does discrimination mean?

Discrimination occurs when someone is treated unfairly because they happen to belong to a particular group of people or have a particular characteristic.

Sex discrimination when a person is treated unfairly or harassed because that person is a woman or because a person is are a man.

Pregnancy discrimination when a person is treated unfairly or harassed or not given the same opportunities because that person is pregnant.

Race discrimination when a person is treated unfairly or harassed because that person is of a particular race, colour, ethnic background, ethno-religious background, descent or nationality.

Age discrimination when a person is treated unfairly or harassed because of that person is of a particular age, for example, because people think a person is are too old, too young or middle aged.

Marital status discrimination when a person is treated unfairly or harassed because person is of a particular marital status — for example, because a person is are single, or married, or living in a de facto relationship Homosexual discrimination when a person is treated unfairly or harassed because a person is a lesbian or gay, or someone thinks that person is lesbian or gay.

Disability discrimination when a person is treated unfairly or harassed because that person has a disability, or someone thinks that person has a disability. It is also against the law to treat a person unfairly or harass a person because that person had a disability in the past, or because that person is will or may get one in the future. Disability includes physical, intellectual and psychiatric disabilities, learning and emotional disorders, and any organism capable of causing disease (for example, HIV).

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Transgender (Transsexuality) discrimination when a person is treated unfairly or harassed because that person is transgender or others think a person is transgender. A person is counted as transgender if a person is live or seek to live as a member of the opposite gender (sex) to that person’s birth gender.

Carers' responsibilities discrimination when a person treated unfairly or harassed (in employment only) because that person is responsible for caring for or supporting some adults or children, or others think that person is responsible for caring for or supporting some adults or children.

It is illegal to discrimination in the provision of accommodation. This includes everything to do with renting flats, houses, hotel/motel rooms, caravans and commercial premises Both ‘direct’ and ‘indirect’ discrimination are against the law •

Direct discrimination means someone is treated unfairly compared to someone else in the same or similar circumstances, and this is because of their sex, pregnancy, race, age, marital status, homosexuality, disability, transgender status or carers’ responsibilities.

For example, if an agent won’t rent toe someone just because they are a woman this is likely to be direct sex discrimination.

•

Indirect discrimination means a requirement (or rule) that is the same for everyone but has an effect or result that is unequal and unreasonable having regard to the circumstances.

The OFT publish consumer guides relevant to discrimination which are useful for both your Principals (vendors and landlords) as well as purchasers and tenants.

It is important that your principals be aware that they cannot place you as their agent in a position whereby they want you to engage in discriminating actions on their behalf. If so both the Principal and the agent are liable for prosecution.

For example: if a landlord stipulates that he will not consider a person of a particular ethic origin as a tenant and that he expects you not to take any applications from such people, your duty here is to advise the landlord that it is unlawful to place you in a position whereby you will be guilty of racial discrimination and that both of you can be prosecuted.

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Fair trading laws Fair trading laws state that you must not engage in conduct that is, in the circumstances, misleading in connection with the supply of goods and services to a customer.

The following is an example that may be both discrimination and misleading conduct.

An Aboriginal person rings the real estate agent about a rental property. On the phone the real estate agent tells the caller that the property is available. When the Aboriginal person goes to the real estate agent to lodge an application, the real estate agent informs them that it is no longer available. Then a non-Aboriginal person asks the same agent and is told that the property is available.

In an actual case like this, the Administrative Decisions Tribunal ruled that the real estate agent was liable under anti-discrimination law and awarded $6,000 damages against the agent.

Let’s show that you are a ‘Fair Go’ business In providing services to your clients, your agency must not use the race, sex, age, marital status, pregnancy, disability, transgender or homosexuality of the person (or their relatives, friends or associates) to decide: •

whether the service is provided – e.g. not accepting applications for rental property from people with characteristics covered by discrimination law

•

to defer a person’s application for accommodation or putting them lower on a list of applicants

•

the terms on which accommodation will be offered, for example charging a higher rent or bond or imposing some other condition

•

the type of service provided – e.g. letting a tenant’s race affect the level of maintenance provided for their rental property

•

the manner in which the service is provided – e.g. people must not be harassed or ignored because of their race, sex, etc to evict a person or subject them to any other detriment.

Counter and phone service often gives a potential client their first impression of your office. It makes good business sense for your agency to make sure that this service is non-discriminatory. This helps you to maintain and expand your business.

You should also make sure that everybody who works in your business is aware of the law and does not themselves discriminate in their dealings with tenants or prospective tenants.

If they do, you may be legally liable for their unlawful actions unless you can show you took all reasonable steps to prevent them doing so.

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Promote your good practices It’s a good idea to develop a letting policy for your office. The letting policy should explain that your agency will not discriminate. Display it publicly to show your clients and prospective clients that you will provide a fair and equal service to all clients. The Real Estate Institute of NSW Letting Policy (produced in association with the AntiDiscrimination Board) is one example you may wish to copy.

It’s good practice to tell tenants why they were unsuccessful with a tenancy application.

If you don’t give a legitimate reason, people may assume discrimination occurred.

Giving reasons may help people to better understand.

The selection criteria is based on these 2 factors: 1.

The tenant’s ability to meet the rent commitment

2.

The tenant’s ability to maintain the premises

All documents regarding the successful tenant should be kept in their tenant file.

The consumer guide from the Office of Fair Trading “The Renting Guide” outlines in plain English for the tenant and landlord their respective rights and responsibilities and a copy must be provided to each party.

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If a principal was to issue instructions to an agent that contravenes the Act, the only choice available to the agent is to refuse the management. It is also important to remember that the anti-discrimination provisions also relate to advertising and other promotional material the agent may prepare.

Tenancy Applications The tenancy application will outline the history of the tenant. It requires the prospective tenant to provide the agent with as much information as is necessary for the agent to ascertain the prospective tenant’s suitability to be chosen for the property.

All references need to be checked including previous landlords, managing agents and employment records. The rental that the prospect is currently paying, or has previously paid, should be taken into account in order to substantiate the tenant’s ability to afford the premises.

On speaking with the previous agent or landlord the property manager will be informed of the condition of the premises at the expiration of the tenancy, the reason why the tenancy was terminated and any other factors that may assist in the determination of the prospects suitability. If the previous agent or landlord gave an unfavorable reference, the reasons should be taken into account before any decision be made.

Investigations onto sites, which register tenants who have defaulted on their Residential Agency Agreement e.g. TICA, should also be made to ensure this applicant has an unblemished rental history.

There are legislative requirements in place governing what an agent is permitted to ask on a tenancy application form. The forms are available from the Real Estate Institute of New South Wales and other stationers. The form used by the individual real estate agency may differ, however most will be an adaptation of the one issued by the Real Estate Institute. As the name suggests, “The Privacy Act” protects the rights of the individual to unjust discrimination. The Tenancy Application Form must not intrude on the privacy of the applicant. Only information relevant to the character and past rental history of the tenant can be asked for in the application form e.g. work references, current pay slips, other managing agents references, etc.

The applications should be considered in order of their receipt by the agent and/or owner to prevent any overt discrimination. Copies of all documentation regarding the selection process should be communicated with the principal and your instructions from the principal sought regarding the choice of applicant prior to the tenant being offered a lease.

Each agency should have specific procedures to follow with reference to recording results from the screening process. In most cases, and again depending on the agent’s instructions, the principal is normally involved in the tenant selection process.

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Tenancy Application Name

Date of Birth

Driver’s License #

Home Phone

Mobile

Email

Other Proposed Occupants

Date of Birth

Relationship to Applicant

Current Residence

Previous Residence

Prior Residence

From/To

From/To

From/To

Current Employment

Previous Employment

Prior Employment

Street Address Suburb State and Postcode Last Rent Amount Paid Owner or Agent Name Owner or Agent Phone Reason for leaving Is/Was rent paid in full?

Did you give notice?

Were you asked to move?

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From/To

From/To

From/To

Reference 2

Next of Kin

Dates of Employment References and Emergency Contacts

Reference 1

Name Street Address Suburb State and Postcode Phone Number By signing this application you grant us permission to communicate with all the contacts if we can’t locate you. If you abandon the tenancy for any reason then you grant us permission to allow your relative listed above to remove all contents of the dwelling on your behalf.

Make

Model

Colour

Year

Registration

How long do you think you would be renting from us?

When would you be able to move in?

Why are you moving from your current address?

Have you ever been served a late rent notice?

Have you ever been served an eviction notice?

Agreement & Authorisation I believe the statements I have made are true and correct. I hereby authorise verification of information I provided and communication with any and all names listed on this application. I understand that any discrepancy or lack of information may result in the rejection of this application. I understand that this is an application for tenancy and does not constitute a rental or lease agreement in whole or part.

Signature: ______________________________________ Date: ____________________

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ELEMENT 4 COMPLETE TENANCY DOCUMENTATION AND PLACE TENANT IN PROPERTY 4.1

Tenancy agreement or lease documentation is produced and completed in line with agency practice, legislative requirements and landlord instructions.

4.2

Procedures for placing new tenant in property are implemented in line with legislative requirements, ethical standards and agency practice.

4.3

Required government fees and duty are paid in line with legislative requirements.

4.4

Security deposits are obtained, deposited and recorded as required by agency practice and legislative requirements.

4.5

Tenancy agreement or lease documentation is served to relevant parties in required timeframes.

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Completing Tenancy Documentation Once the application has been screened and approved by the owner/agent the tenant will now enter into and sign a tenancy agreement. The residential tenancy agreement must meet the statutory requirements as well as the agency and client needs. Part 2 of the Residential Tenancies Act 2010 deals wholly with residential tenancy agreements, Section 8 focuses on the standard form of this agreement. The agreement is in 2 parts: • •

Part (1) the terms of the agreement (what the landlord and tenant agree to do during the term of the tenancy) and Part (2) the condition report (detailing the state of the premises at the beginning of the tenancy.

The tenant/s should be given some time to read through the agreement and the property manager should answer any queries they may have prior to them signing.

Upon signing they will be required to pay a rental bond.

Rental Bond A rental bond is an amount of money paid by a tenant as a form of security for the landlord in case the tenant does not follow the terms of the agreement.

Amount of bond Charging a rental bond is not mandatory, however the maximum rental bond that can be asked for is: •

four weeks rent, for unfurnished premises

•

six weeks rent, for fully furnished premises with a rent of $250 or less per week

•

unlimited, if the rent for fully furnished premises is more than $250 per week.

The amount of bond that is to be paid (if any) must be written on the agreement.

Demanding or receiving a written guarantee from a tenant, or somebody on their behalf, is not permitted. A rental bond must be in the form of money and not as a guarantee A “Bond Lodgment Form” is also given to the tenant to be signed.

The Bond Lodgment form describes the amount of rental bond to be lodged with the Rental Bond Board, which is administered by the Office of Fair Trading.

The agent must send the bond money to the OFT within seven (7) days.

After the bond is lodged, all parties should receive an advice of lodgment that includes the unique rental bond number. If the advice is not received, the tenant should contact Doc ID: CPPDSM4010A - Workbook (L) eLearning Date: 28/03/2018 Developed by: SL Version: 7 Approved by: CEO P a g e | 63 File Location: S:\Learning & Assessment Resources\Real Estate\CPP40307 Certificate IV in Property Services (Real Estate) NSW\Assessment Tools\13. CPPDSM4010A\CPPDSM4010A - Workbook (L) eLearning.doc

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Fair Trading to confirm that the bond had been lodged. It is an offence for a landlord/agent to request a rental bond from their tenant and then not lodge it with Fair Trading.

During the tenancy, the bond is held by the Rental Bond Board and accumulates interest. The Rental Bond Board is the independent custodian of rental bonds paid by tenants to landlords for residential tenancies. The Office of Fair Trading administers the day to day functions of the Board, providing rental bond lodgement, custody, refund and information services.

The landlord and tenant can now sign the “Residential Tenancy Agreement” prepared by the agency, a copy of which must be given to the tenant along with a copy of “The Rental Guide”. The agency agreement has provided that the agent can sign this residential tenancy agreement on behalf of the landlord. Copies of The Rental Guide pamphlet can be obtained free of charge from the Office of Fair Trading. Legislation demands that it accompany all leases, and a copy given to both the landlord and tenant.

Once all the above steps have been completed, a further statutory procedure that now must be completed by the tenant is the completion of their comments on the property condition report. The keys and the condition report have been released to them once all the documentation has been completed and the agent on behalf of the owner has received all entry costs.

Two copies of the condition report that the agent/landlord completed are provided to the tenant. The tenant is to complete their section indicating agreement or disagreement on the report and the tenant must return one copy to the agent/landlord within 7 days of receiving it.

It is at this point that any points of difference between the comments be addressed, e.g. the tenant may find that during their first week of occupancy that the toilet is not flushing properly. They would note this on their report and bring it to the attention of the agent to be repaired immediately. The managing agent would notify their Principal in writing of the required maintenance and seek instructions for repairs to proceed.

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Claiming the bond back At the end of the tenancy, after the final inspection, a Claim for Refund of Bond Money form must be submitted to Fair Trading before the bond money can be refunded. This form should be signed if it is blank or incomplete. The landlord or agent may want to claim some or all of the bond for themselves if they believe the tenant has damaged the premises, breached the agreement or owe rent.

Any disagreement over how the bond is to be refunded should first be discussed between the parties. If agreement cannot be reached, either party may send a Claim for refund of bond money form to the Office of Fair Trading without the signature of the other party. The bond will not be paid out straight away. A letter will be sent to the other party advising them of the claim and giving them 14 days to apply to the Consumer, Trader and Tenancy Tribunal to dispute the claim. If no reply is received within 14 days the bond will then be paid out..

No matter who applies to the Tribunal, it is always up to the landlord to prove any claim on the bond.

If there are any questions about rental bonds, or the progress of your bond refund, call Fair Trading on 13 32 20.

Case study: Rental bond – Joanne’s sons had accidentally broken the sliding door in the unit they rented and the owners then refused to return the bond when they left the apartment. Joanne didn’t think it was fair as the bond was more money than it would have cost to repair the door.

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Joanne contacted the Office of Fair Trading who advised her about her rights and told her to write some letters disputing why they should release the bond. Fair Trading handled the matter for her and followed up when there was no response. Soon after, Joanne got her bond money back. “Once the Office of Fair Trading became involved I felt it was being handled professionally, and also, it removed me from becoming angry about the situation.�

Forms Download: http://www.fairtrading.nsw.gov.au/Tenants_and_home_owners/Renting_a_home/Bonds.html

Four forms relating to rental bonds are available to download in PDF format.

Claim for Refund of Bond Money (size: 102k) Transfer of Bond (size: 134k) Change of Shared Tenancy Arrangement (size: 73k) Change of Managing Agent/Owner (size: 74k)

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HANDLING MONIES Under financial management, the agent must issue the tenant with a receipt for all money received. Section 40 of the Residential Tenancies Act 2010 states the particulars that must be included on a receipt i.e. details of the tenant, landlord (principal), the address of the premises, period for which rent is received and all money received. Most real estate agencies have a property management software system to record all these transactions. Some smaller offices may still use a manual system to record information.

In accordance with the instructions contained in the managing agency agreement, the agent must account to the principal at regular intervals, for all money collected from the tenant. The rental statement produced for the principal outlines all money collected (by way of rent, bond etc.) and identifies all disbursements including management fees and charges (postage, government fees etc.) that were paid on behalf of the landlord.

The agreement also authorizes the agent to deduct all their entitlements from any monies received on behalf of the principal at the time they account to the principal, usually monthly.

Trust account transactions must therefore be accurately recorded to ensure the accounts reconcile at the end of each accounting period and conform with statutory requirements.

This unit has provided you with an overview of the administration procedures and the legislation that require you as an agent to correctly lease property. Obviously, as well as this knowledge, a clear understanding and application of office procedures and practices is imperative to function successfully within the property management department in the role of leasing property.

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Ending the Tenancy Agreement

Summary of the usual eviction process 1. The landlord must give the tenant a correct 'notice of termination' with a date on which they want you to leave.

2. If the tenant is not out by that date they are not breaking the law. However, this gives the landlord the right to apply to the Consumer, Trader and Tenancy Tribunal (CTTT) for 'termination' and 'vacant possession' orders.

3. The CTTT will consider the case and decide whether to evict the tenant. If the CTTT decides to terminate the tenancy, it will order the tenant to give back the premises on a particular date.

4. The landlord becomes entitled to take possession of the premises according to the order for possession.

How much notice must the landlord give?

This depends on the type of tenancy agreement.

A fixed-term agreement is for a specified period of time (e.g. 6 months). A continuing agreement is one where the fixed-term has expired or no period is specified.

To end a fixed-term agreement the minimum notice required is: • 14 days at the end of term • 14 days if the tenant breaks the agreement (‘breach of agreement’).

For a continuing agreement, the minimum notice is: • 60 days if no reason is given (‘no grounds' termination) • 14 days for breach of agreement • 30 days for sale of the premises.

If a notice is posted to the tenant, an extra 4 working days must be allowed for delivery.

Immediate notice if premises are unlivable The landlord (or the tenant) can end the agreement if the premises become unfit to live in due to something which is neither the fault of the tenant or the landlord.

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Fixed-term agreement – end of term The landlord cannot end the tenancy agreement before the last day of the fixed term unless it is established that the tenant has broken the agreement.

If the agreement does not terminate at the end of the term, it automatically becomes a continuing agreement.

If the landlord does not want their tenancy to continue after the fixed term, they must give the tenant 14 days written notice up to and including the last day of the term. The landlord can give the notice on any day before the last day of the fixed term, so long as the tenant receives14 days.

Breach of agreement Examples of breaches are: being behind in the rent, damaging the premises, or using the premises for illegal activity.

If a breach is serious or persistent, the landlord can give the tenant a 14-day written termination notice. (The notice is the same for fixed-term and continuing agreements.)

If the tenant does not obey the notice, the landlord may apply to the CTTT for an order to evict the tenant.

Continuing agreement – 'no grounds' termination If there exists a continuing agreement, the landlord can end it by giving 60 days written notice without a reason. However, the tenant can argue in the CTTT that they should be allowed to stay because of the circumstances (e.g. illness) but this can be difficult to argue.

Sale of premises If a tenant is still in the fixed term of the tenancy agreement, they cannot be evicted because the premises are being sold.

If a continuing agreement exists, and contracts have been exchanged (between the landlord and a new owner) that require vacant possession, the current landlord can give the tenant a 30-day written termination notice.

Application to the CTTT without notice The landlord can apply directly to the CTTT for an order for possession of the premises without giving the tenant notice of termination for the following reasons: •

The tenant or their guests have caused serious damage to the premises deliberately or recklessly

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•

The tenant has injured or are likely to injure the landlord, agent or neighbours

•

the landlord would suffer hardship if the agreement is not ended (the CTTT can order the landlord to pay compensation to the tenant for having to leave).

Can the landlord evict a tenant for complaining?

The landlord should not evict a tenant for asserting their rights. If a tenant refuses to leave the premises, the landlord will need to apply to the CTTT for a termination order.

Form of the notice of termination THE NOTICE OF TERMINATION BY THE LANDLORD MUST BE IN WRITING AND HAVE CONSUMER, TRADER AND TENANCY TRIBUNAL About the tribunal The Consumer, Trader and Tenancy Tribunal (CTTT) is an independent body which can deal with some disputes between landlords and tenants. It is not a formal court, but its decisions are legally binding. The people who hear cases at the CTTT are called Tribunal Members.

Applying for a hearing Application forms are available at: • Fair Trading Centres (www.fairtrading.nsw.gov.au) • your local Tenants Advice and Advocacy Service (TAAS) • CTTT registries or website (phone 1300 135 399 or see www.cttt.nsw.gov.au).

Most remedies from the CTTT are for breach of contract (not obeying terms of the residential tenancy agreement).

Generally, you have up to 30 days from when you became aware of a breach to apply.

Longer time limits apply in certain disputes. If you apply after 30 days, you can ask for an extension.

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You can apply for an urgent hearing. Attach a letter to the application saying why it is urgent.

Costs An application costs $34.

A summons for a witness or documents costs $37.

If the CTTT thinks that your application is not serious or that you are deliberately wasting its time, you may have to pay the tenants’s costs.

Representation Tenants usually represent themselves. A tenant may ask the CTTT to let another person (such as a tenant advocate) speak on their behalf, but they will need to convince the Tribunal Member that this is required.

A landlord may use a real estate agent to represent them.

Solicitors may only represent landlords or tenants in special cases.

You should go to the hearing It is important to attend the hearing as the CTTT can make orders that affect you, even if you are not there. If you do not go, you could later find that •

you have been ordered to pay charges that you did not know about

•

everything the tenant said was taken as fact – you were not there to give evidence that the tenant was behaving unreasonably or making false claims.

If you apply for a hearing and do not attend, the CTTT will dismiss your application altogether.

Changing a hearing date If the hearing is set for a date or time that you cannot make, write to the CTTT before the hearing and ask for another date or time. It also helps to ask the tenant personally to agree to a change. You must give reasons for your request.

If you do not hear from the CTTT about your request, attend the hearing as it may go ahead without you.

If you cannot ask for a change before the hearing, you can send someone else to ask for a new date. They will need a letter saying that they can speak for you, and they should also know the facts of your tenancy problem in case the CTTT refuses your request and runs the case without you.

If you are running late for a hearing, call the CTTT and say that you are on your way, otherwise the hearing may be over by the time you get there.

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What to take to the hearing The Tribunal Member hearing your case will need evidence that supports your arguments. If possible, take 3 copies of documents you want to use – one each for you, the tenant and the Tribunal Member. These might include: •

the residential tenancy agreement

•

a brief written statement of your case

•

statutory declarations by other people who have witnessed important events or who can support your case (signed by a Justice of the Peace or a solicitor)

•

receipts or quotes (e.g. for rent, bond, cleaning, repairs)

•

copies of all letters between you and the tenant

•

photographs that show the problem.

The first hearing At the first hearing, the Tribunal Member will ask you and the tenant to try to negotiate an agreement (conciliation). Sometimes a conciliator will help you, but often it is just you and the tenant.

If an agreement is made, the conciliator or Tribunal Member will write an order with your agreement – this ends the case.

If you and the tenant cannot agree during conciliation, you have the right to have your case heard by a Tribunal Member. The CTTT may hear your case on the same day or set it to be heard on another day.

During a hearing In an ‘informal’ hearing, the Tribunal Member will listen to you, and the tenant , and the tenants’s representative (if any). They will look at any documents, photos or other evidence, and will ask questions. They will then make a decision about the case – known as ‘orders’.

If the case is more complex, or either side wants to bring witnesses, a ‘formal’ hearing may be held. The case will be run more like a court, with evidence usually given on oath or affirmation. The Tribunal Member will usually ask the applicant (the person who lodged the application) to present their case first, then ask the other side to respond.

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Notice of orders and reasons Notices of orders are sent by mail. If you want the reasons for orders, write to the CTTT Registrar within 14 days of getting the notice of orders.

Money orders Money orders can be enforced through the Local Court. That process is started with a certified money order from the CTTT Registrar.

Renewing an application If the tenant does not obey an order (other than a money order) you may apply to the CTTT to have the case renewed. The fee for a renewal application is $34 ($5 for students/pensioners).

You must apply within the time given in the original order or within 12 months of the date for compliance in the original order.

Rehearing In some circumstances, an order may be changed or cancelled by a rehearing.

You must apply within 14 days of the date you received a notice of the order, or 14 days after receiving written reasons for a decision.

Fill out an ‘Application for a Rehearing’ form and return it with the fee to the CTTT registry. The form asks you to prove that: •

there is substantial injustice, and

•

the decision was not ‘fair and equitable’, or

•

the decision was against the weight of evidence, or

•

evidence is now available that was not available at the time of the hearing

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In Summary The general risk areas in real estate practice are: •

The requirements of the Property Stock and Business Agents Act 2002

•

Statutory obligations and responsibilities of an agent in property management

•

Handling of listed and managed properties

•

Security of listed and managed properties

•

Receiving and handling of monies

To actually manage risk the following approach should be adopted: •

Analyse potential risks to agency and the client

•

Implement policies and procedures to minimise risk occurring

•

Create monitoring and reporting systems to minimize risk to the agency and clients.

The most beneficial approach regarding the above should involve all staff of an agency, at management level and in consultation with the staff from the administration, sales and property management departments. This team involvement encourages individual and team responsibility by all. It supports the aim of wider awareness and ownership of responsibility with the long-term benefit to all. The impact of risk and loss has a rippling effect on all involved, hence it is the holistic approach that will be mostly proactive.

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Leasing of residential or rural property Agency agreement terms 1.

Identification of property

2.

Names of parties to agreement

3.

Information identifying the parties

4.

Principal’s authority to enter into agreement

5.

Authorisation for licensee to act on behalf of principal

6.

Period of duration of the agreement

7.

Termination of the agreement

8.

Reimbursement of licensee

9.

Remuneration

10.

Extent of agent’s authority

11.

Details about the period of the tenancy, rent and bond

12.

Disclosure of rebates, discounts or commissions

1. Identification of property The agreement must specify the address of the property to which the agreement applies or must contain a description of the property sufficient to clearly identify it.

2. Names of parties to agreement The agreement must specify the names of each of the parties to the agreement, including the licensee.

3. Information identifying the parties The agreement must specify the principal’s address, the licensee’s licence number and any business name under which the licensee conducts business.

4. Principal’s authority to enter into agreement The agreement must contain a statement to the effect that the principal warrants that the principal has authority to enter into the agreement.

5. Authorisation for licensee to act on behalf of principal The agreement must include a term containing particulars of the extent of the licensee’s authority to act as agent on behalf of the principal in providing services under the agreement.

6. Period of duration of the agreement The agreement must contain a term indicating the period for which the agreement remains in force or indicating that the agreement remains in force until terminated.

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7. Termination of the agreement If the agreement provides for its termination by a party to the agreement, the agreement must indicate how and when it can be terminated.

8. Reimbursement of licensee If the licensee is to be entitled to any sum or reimbursement for expenses or charges incurred by the licensee in connection with services provided under the agency agreement, the agreement must include a term that: (a) states that the licensee is so entitled (b) describes those services (c) specifies the amount that the licensee is so entitled to and when it is payable (d) states that those services and amounts cannot be varied except with the agreement in writing of the principal.

9. Remuneration The agreement must include a term specifying: (a) the circumstances in which the licensee is entitled to remuneration (by way of commission or otherwise) for services performed under the agreement, and (b) the amount of the remuneration or the way in which it is to be calculated, and (c) when the remuneration is payable.

10. Extent of agent’s authority The agreement must include any written confirmation prepared for the purposes of the Real estate agents, Rules of conduct or Stock and station agents, Rules of conduct of the extent of the agent’s authority to undertake the following duties in relation to the entering into of the lease and any limitations on the agent’s authority to undertake those duties: (a) obtaining references from prospective tenants, arranging inspections of the property by prospective tenants and choosing a tenant (b) entering into and signing a tenancy agreement (c) undertaking an initial inspection of the property (d) collecting the initial rent payment (e) receiving and disbursing rental bond money (f) advertising the property for letting.

11. Details about the period of the tenancy, rent and bond The agreement must specify the period of the tenancy, the amount of the rent to be paid, the rent payment period and the amount of the bond to be paid.

12. Disclosure of rebates, discounts or commissions The agreement must include provision for the licensee to identify the source and amount or estimated amount of all rebates, discounts or commissions the licensee will or may receive in respect of expenses payable by the client for the services to be provided by the agent Doc ID: CPPDSM4010A - Workbook (L) eLearning Date: 28/03/2018 Developed by: SL Version: 7 Approved by: CEO P a g e | 77 File Location: S:\Learning & Assessment Resources\Real Estate\CPP40307 Certificate IV in Property Services (Real Estate) NSW\Assessment Tools\13. CPPDSM4010A\CPPDSM4010A - Workbook (L) eLearning.doc

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Rules of conduct: Real estate agents and salespersons - property management Real estate agents and salespersons – sales: Rules 20 – 28 Real estate agents and salespersons – property management: Rules 29 – 31 Rules of conduct 1. Knowledge of Act and Regulations An agent must have a knowledge and understanding of the Act and the regulations under the Act and other relevant laws, (including laws relating to tenancy, fair trading, trade practices, anti-discrimination and privacy) as may be necessary to enable the agent to exercise his or her functions as agent lawfully.

2. Fiduciary obligations An agent must comply with the fiduciary obligations arising as an agent.

3. Honesty, fairness and professionalism An agent must act honestly, fairly and professionally with all parties in a transaction.

An agent must not mislead or deceive any parties in negotiations or a transaction.

4. Skill, care and diligence An agent must exercise reasonable skill, care and diligence.

5. High pressure tactics, harassment or unconscionable conduct An agent must not engage in high pressure tactics, harassment or harsh or unconscionable conduct.

6. To act in client’s best interests An agent must act in the client’s best interest at all times unless it would be contrary to the Act or regulations under the Act or otherwise unlawful to do so.

7. Confidentiality An agent must not, at any time, use or disclose any confidential information obtained while acting on behalf of a client or dealing with a customer, unless: (a) the client or customer authorises disclosure, or (b) the agent is permitted or compelled by law to disclose.

8. To act in accordance with client authority An agent must not act as an agent or represent himself or herself as acting as an agent on behalf of a person without written authority.

9. To act in accordance with client’s instructions An agent must act in accordance with a client’s instructions unless it would be contrary to this Act or regulations under the Act, or otherwise unlawful to do so.

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10. Licensee must ensure employees comply with the Act and regulations An agent who is the licensee-in-charge at a place of business must take reasonable steps to ensure other licensees or registered persons employed in the business conducted there comply with the Act and regulations under the Act. 11. Conflicts of interest An agent must not accept an appointment to act, or continue to act, as an agent if doing so would place the agent’s interests in conflict with the client’s interests.

12. Referral to service provider An agent who refers a principal or prospect to a service provider must not falsely represent to the principal or prospect that the service provider is independent of the agent.

A service provider is considered to be “independent” of an agent if: a) the agent receives no rebate, discount, commission or benefit for referring a client or customer to the service provider, and (b) the agent does not have a personal or commercial relationship with the service provider.

The following are examples of a personal or commercial relationship: (a) a family relationship, (b) a business relationship, (c) a fiduciary relationship, (d) a relationship in which one person is accustomed, or obliged, to act in accordance with the directions, instructions or wishes of the other person.

If the service provider is not independent of the agent, the agent must disclose to the principal or prospect: (a) the nature of any relationship, whether personal or commercial, the agent has with the service provider, and (b) the nature and value of any rebate, discount, commission or benefit the agent may receive, or expects to receive, by referring the client or customer to the service provider.

13. Licensee not to recommend engagement of services of solicitor or licensed conveyancer acting for other party An agent must not recommend that a principal or prospect engage the services of a solicitor or licensed conveyancer, or firm of solicitors or licensed conveyancers, if the agent knows that the solicitor or licensed conveyancer, or the firm of solicitors or licensed conveyancers, acts or will be acting for the other party to the agreement concerned.

Sub-clause (1) does not prevent an agent recommending that a principal or prospect engage the services of a solicitor or licensed conveyancer if no other solicitor or licensed conveyancer is available (for example, in a remote location).

If no other solicitor or licensed conveyancer is available, the agent must, in recommending their engagement, advise the principal or prospect that the solicitor or licensed conveyance is or will be acting for the other party.

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14. Inducements An agent must not offer to provide to any other person any gift, favour or benefit, whether monetary or otherwise, in order to induce any other person to engage the services of the agent as agent in respect of any matter.

15. Soliciting through false or misleading advertisements or communications An agent must not solicit clients or customers through advertisements or other communications that the agent knows or should know are false or misleading.

16. Insertion of material particulars in documents An agent must not submit or tender to any person for signature a document, or cause or permit any document to be submitted or tendered to any person for signature, unless at the time of submission or tendering of the document all material particulars have been inserted in the document.

17. Duty to provide copy of signed documents An agent who submits or tenders a document to any person for signature, or who causes or permits a document to be submitted or tendered to any person for signature, must immediately after the person has signed the document give a copy of the document to the person.

18. Representations about the Act or regulations An agent must not falsely represent to a person the nature or effect of a provision of the Act or any regulation under the Act. An agent must not, either expressly or impliedly, falsely represent, whether in writing or otherwise, to a person that a particular form of agency agreement or any term of such an agreement is required by the Act or a regulation under the Act. 19. Agency agreements must comply with regulations An agent must not enter into an agency agreement unless the agreement complies with any applicable requirements of the Property, Stock and Business Agents Regulation 2003, as required by section 55 of the Act. 20. Preliminary physical inspection of property for sale to be conducted by agent An agent must not act on behalf of a principal in respect of the sale of a property unless the agent has conducted a preliminary physical inspection of the property.

21. Sales inspection report required for property On completion of the physical inspection of the property, an agent must prepare and give to the principal a sales inspection report for the property. The report must specify the following and be signed by the agent: (a) the principal’s name and address, (b) the date of preparation of the report, (c) the agent’s name, business address and telephone number, (d) a description of the property, including the address of the property and such other details as may be necessary to enable the property to be readily identified, (e) a description of any fittings and fixtures that are to be included in the sale of the property, Doc ID: CPPDSM4010A - Workbook (L) eLearning Date: 28/03/2018 Developed by: SL Version: 7 Approved by: CEO P a g e | 80 File Location: S:\Learning & Assessment Resources\Real Estate\CPP40307 Certificate IV in Property Services (Real Estate) NSW\Assessment Tools\13. CPPDSM4010A\CPPDSM4010A - Workbook (L) eLearning.doc

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(f) any terms and conditions of sale known to the agent (for example, whether or not vacant possession is to be given), (g) the agent’s recommendation as to the most suitable method of sale of the property, (h) the agent’s estimate of the selling price (or price range) for the property, (i) details of any covenants, easements, defects, local government notices or orders affecting the property that are known to the agent, (j) details of any special instructions about the marketing and showing of the property, (k) the name, business address, telephone number and address for service of documents of the principal's solicitor.

22. Principal to be informed of offer The agent must, unless the principal has instructed to the contrary in writing, inform the principal of all offers of purchase as soon as practicable after receiving the offer up until exchange of contracts has taken place.

If the agent is not going to inform the principal of an offer, the agent must inform the person who made the offer that the offer will not be submitted to the principal.

The agent may inform the principal of an offer orally or in writing and must identify the party by whom the offer is made. If the principal is informed orally, the agent must confirm the information in writing.

This clause does not apply to bids made in the course of an auction.

23. Setting aside minimum or reserve price at auction When the bidding at an auction does not reach the minimum or reserve price fixed for the property by the principal, the licensee conducting the auction must not set aside that price without the express permission of the principal or a person authorised to give that permission by the principal.

24. Information to be given when expression of interest deposit paid When an agent issues a receipt for an expression of interest deposit made prior to exchange of contracts, the agent must inform the person who paid the deposit that the principal has no obligation to sell the property or the purchaser to buy the property and the deposit is refundable if a contract for the sale of the property is not entered into. The information must be provided in writing and may be provided on the receipt.

The agent must promptly inform the principal when an expression of interest deposit has been paid.

The agent must promptly inform the person who paid the deposit when the agent becomes aware of any subsequent offer to purchase the property received from any other person. The agent must also advise the person who paid the deposit that they have the right to make further offers up until exchange of contracts has taken place.

25. Notifying managing agent of appointment to sell residential property If an agent accepts an appointment to sell residential property that is tenanted, the agent must immediately give written notice of the appointment to any agent responsible for managing the property.

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26. Licensee must not accept payment for a referral An agent must not demand or accept a fee or other valuable consideration for referring the principal to a buyers agent.

27. Bidding on behalf of a telephone bidder An agent must not bid at an auction on behalf of a person who is giving instructions to the agent by telephone unless: (a) the written authority on the basis of which the agent bids on behalf of the person contains an acknowledgement that the person has been given a copy of the conditions that are applicable in respect of the sale, and (b) the agent is satisfied that the person has been given a copy of those conditions.

28. Agent participating in exchange of contracts for residential property If an agent participates in the exchange or making of a contract for the sale of residential property, the agent must serve a copy of the contract within 2 business days on: (a) each party to the contract, unless paragraph (b) requires the agent to serve a copy of the contract on a solicitor or conveyancer acting for the party, or (b) the solicitor or conveyancer acting for a party to the contract if the party has notified the agent, or it is apparent from the contract, that a solicitor or conveyancer is acting for the party.

29. Inspection report An agent must, as soon as practicable after entering into an agency agreement in respect of the management of property, prepare and give to the principal an inspection report for the property. The inspection must include the following and be signed by the licensee: (a) the name and address of the principal, (b) the address of the property, (c) the date of preparation of the report, (d) the licensee’s name, licence number and business address, (e) a description of the exterior and interior condition of the property, including fittings, fixtures, improvements and anything provided with the property, (f) details of any work still to be completed by the principal on the property.

30. Inspection of property for rent An agent must accompany a prospective tenant on an inspection of the property.

An agent must not give the keys to a property to a prospective tenant, even for a short time.

The sub-clauses in rule 30 do not apply if the principal, and, if the property is currently let, the tenant, have authorised otherwise in writing.

31. Use of collection agent to collect rent A licensee must not use the services of a collection agent to collect rent on behalf of a principal unless the arrangements for the collection and holding of that rent pending its payment to the agent or the principal comply with such guidelines as the Commissioner for Fair Trading may Doc ID: CPPDSM4010A - Workbook (L) eLearning Date: 28/03/2018 Developed by: SL Version: 7 Approved by: CEO P a g e | 82 File Location: S:\Learning & Assessment Resources\Real Estate\CPP40307 Certificate IV in Property Services (Real Estate) NSW\Assessment Tools\13. CPPDSM4010A\CPPDSM4010A - Workbook (L) eLearning.doc

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issue from time to time under this clause (including guidelines requiring rent collected by a collection agent to be paid into and retained in a trust account).

In this clause, collection agent means a person who collects rent as agent for and on behalf of a licensee.

Top of page 32. Maintenance or repairs of rental property An agent managing a rental property must promptly respond to and, subject to the principal’s instructions, attend to all requests by a tenant for maintenance of, or repairs to, the property.

If the principal has instructed that a repair not be carried out, the agent must inform the principal if the principal’s failure to carry out the repair would constitute a breach of any tenancy agreement in force in relation to the property.

33. Breach of tenancy agreement An agent managing a rental property must immediately notify the principal in writing if the agent becomes aware of a tenant’s breach of the tenancy agreement.

34. Notifying tenant of appointment to sell This clause applies if an agent managing a rental property is aware that: (a) the property is listed for sale, or (b) a real estate agent has been appointed to act on the sale of the property.

The agent must immediately give the tenant written notice of: (a) the intended sale of the property, or (b) the appointment of the real estate agent for the sale of the property (together with the name and contact details of the agent).

35. Final inspection of property An agent must take all reasonable steps to ensure that any final inspection of the property, on vacation of the property, is conducted in the presence of the tenant (unless otherwise authorised by the tenant).

Note. ‘Reasonable steps’ by an agent would comprise contacting the tenant to discuss suitable times for the inspection, arranging to meet at a particular time and place and proceeding to meet the tenant at the arranged time and place.

36. Obtaining tenant’s signature for rental bond refund An agent must not solicit or obtain the signature of a tenant to any document relating to the refund of a rental bond prior to the termination of the tenancy, unless the document directs the bond to be repaid in full to the tenant or transferred to another tenancy in accordance with the tenant’s directions.

37. Co-operation about records, access and transfer If an agent is acting on behalf of a principal in the management of property and is advised by another agent that the other agent (the new agent) has been engaged to act on behalf of that principal in the management of that property, the agent must co-operate with the new agent in Doc ID: CPPDSM4010A - Workbook (L) eLearning Date: 28/03/2018 Developed by: SL Version: 7 Approved by: CEO P a g e | 83 File Location: S:\Learning & Assessment Resources\Real Estate\CPP40307 Certificate IV in Property Services (Real Estate) NSW\Assessment Tools\13. CPPDSM4010A\CPPDSM4010A - Workbook (L) eLearning.doc

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regards to access to the records of the principal, including but not limited to making the records reasonably available (according to law), and facilitating the transfer of management functions between the agent and the new agent.

38. Disclosure of potential agency If an agent intends to act (or offers to act) for a principal in the management of property and is aware that another agent is or other agents are managing that property for the principal, the agent must, unless the principal otherwise directs in writing, disclose their intention to act or to offer to act to the current agent or agents.

39. Confirmation of specific instructions – property management services Before or at the time of entering into an agency agreement under which the agent will provide property management services in respect of the leasing of residential property or rural land, the agent must prepare for inclusion in the agency agreement written confirmation of the extent of the agent’s authority to undertake the following duties in connection with the management of the property and any limitations on the agent’s authority to undertake those duties: (a) obtaining references from prospective tenants, arranging inspections of the property by prospective tenants and choosing a tenant, (b) entering into and signing a tenancy agreement (specifying the term for which the property may be let), (c) undertaking inspections of the property, (d) effecting repairs to and maintaining the property or engaging tradespersons to do so and limitations on expenditure that may be incurred by the agent without obtaining the principal’s approval, (e) paying disbursements and expenses incurred in connection with the agent’s management of the property, (f) collecting rent, (g) receiving, claiming and disbursing rental bond money, (h) serving notices for breach of the tenancy agreement or to terminate the tenancy agreement, (i) undertaking the necessary steps to obtain vacant possession and recover any money owing to the principal in relation to the tenancy of the property, (j) representing the principal in any tribunal or court proceedings in respect of the tenancy of the property, (k) paying accounts for amounts owing in relation to the property (for example, water rates and charges, council rates, maintenance expenses and owners corporation levies), (l) advertising the property for letting or re-letting, (m) reviewing the rent at the end of a tenancy.

40. Confirmation of specific instructions – leasing of property Before or at the time of entering into an agency agreement under which the agent will act for the owner of residential property or rural land in relation to the entering into a lease of the residential property or rural land, the agent must prepare for inclusion in the agency agreement Doc ID: CPPDSM4010A - Workbook (L) eLearning Date: 28/03/2018 Developed by: SL Version: 7 Approved by: CEO P a g e | 84 File Location: S:\Learning & Assessment Resources\Real Estate\CPP40307 Certificate IV in Property Services (Real Estate) NSW\Assessment Tools\13. CPPDSM4010A\CPPDSM4010A - Workbook (L) eLearning.doc

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written confirmation of the extent of the agent’s authority to undertake the following duties in connection with the entering into of the lease and any limitations on the agent’s authority to undertake those duties: (a) obtaining references from prospective tenants, arranging inspections of the property by prospective tenants and choosing a tenant, (b) entering into and signing a tenancy agreement, (c) undertaking an initial inspection of the property, (d) collecting initial rent payment, (e) receiving and disbursing rental bond money, (f) advertising the property for letting.

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ELEMENT 5 RECORD TENANCY ARRANGEMENTS 5.1

Tenancy database is updated to record details of tenancy arrangements in line with agency practice.

5.2

Trust account transactions are accurately recorded to show moneys taken in and disbursements made in line with agency practice, tenancy agreement or lease documentation, and legislative requirements.

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The Tenancy Database As a managing agent, once a property has been leased, it is important to maintain a database to record an accurate record of all transactions, contracts, and actions required and correspondence. The database should also be used to prepare a diarised track of future procedures to be carried out e.g. on-going condition inspections/reports, market appraisals by the sales department, etc.

Areas of express or implied responsibility arise from the Property Stock and Business Agents Act of 2002 and its regulations. They can be broken into four main function areas: •

Document management: requiring the correct completion of necessary agreements (agency and letting) together with the storage of copies of relevant correspondence.

•

Financial management: collection and accounting of rents, payment of accounts, including the disbursement of bonds, plus the production of monthly or regular management statements.

•

Physical management: premises.

•

Key and lock management: ensuring the security of both the premises and the keys.

involved with the inspection and maintenance of leased

Tenant databases Many real estate agents use tenant databases to identify potentially unreliable tenants.

The Property, Stock and Business Agents Amendment (Tenant Databases) Regulation 2004 introduced rules of conduct for real estate agents and property managers who use tenant databases.

Who does the Regulation apply to?

Real estate agents who manage property and on-site residential property managers and their registered employees.

When did the Regulation start?

The Regulation applies to any listing made on or after 15 September 2004. The Regulation does not apply to listings made prior to 15 September 2004.

What do the rules mean?

Before a residential tenancy agreement is signed, an agent must advise the tenant, verbally or in writing, that if they breach the agreement their personal information could be listed on a tenant database.

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It is recommended that agents keep a written record of such notification as proof of compliance. Some records have to be kept for 5 years.

Before a tenant is listed The following conditions must be met: •

the agent must have provided property management services in respect of the tenant’s residential tenancy agreement

•

the residential tenancy agreement must be terminated

•

the agent must give the tenant/former tenant:

•

a written notice of intention to list them on a tenant database and thereason for doing so

•

a reasonable opportunity to respond and review or correct any personal information to be listed.

However, an agent does not have to notify a tenant or give a tenant that opportunity, if the agent cannot locate the tenant after making reasonable inquiries. The agent must keep a written record of the notification and any response by the tenant, or attempts to locate the tenant, for at least 5 years.

If the agent and tenant cannot agree about the personal information to be listed, the agent must note the tenant’s objection on the database.

Reasons for listing a tenant An agent cannot list a tenant for a trivial or subjective reason. A tenant can only be listed for the following specific reasons: •

the tenant owes the landlord money for rent and/or damage caused intentionally or recklessly to the residential premises (but only if the amount owing exceeds the amount of the rental bond)

•

the tenant has failed to pay an amount of money to the landlord in accordance with an order of the Consumer, Trader and Tenancy Tribunal (CTTT)

•

the CTTT has issued a termination and possession order for serious or persistent breach of the residential tenancy agreement

•

the CTTT has issued a termination and possession order where the tenant causes serious damage or injury.

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Listing a tenant for money owed due to damage to the residential property Before listing a tenant for this reason, the agent must: •

complete a condition report

•

note the damage on the condition report

•

report the damage to the police and be given the corresponding incident number

•

check whether the tenant has made an application to the CTTT regarding the residential tenancy agreement.

Where a tenant has made an application to the CTTT, an agent cannot list the tenant for money owed due to damage unless the CTTT has determined the application.

After a listing has been made It is recommended that an agent tries to send a copy of the listing to the tenant after it has been made.

Notifying database operators when debts are paid If a tenant is listed after 15 September 2004 for owing the landlord money and the debt is paid, then within 7 days of becoming aware that the payment has been made, the agent must notify the database operator that the debt has been paid.

Use of compliant database operators Under the Regulation, an agent must only contract with tenant database operators who: •

ensure that listed tenants have cost-free access to their listed personal information

•

amend listed information that the tenant claims is incorrect, inaccurate or incomplete at no cost to the tenant (unless the agent disputes the claim*)

•

delete listings within the following time frames: ▪ within 7 days of being notified that a tenant’s listed debt has been paid, if the debt was paid within 3 months of the date it was incurred ▪ on the third anniversary of the date of the listing, for a tenant’s debt paid more than 3 months after it was incurred (after having recorded the date on which the debt was paid, within 7 days of being notified by the agent ▪ on the third anniversary of the date of the listing, if a tenant has been listed for any reason other than for non-payment of a debt. *If an agent disputes the tenant’s claim, the tenant’s claim should be noted on the database.

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Penalties and disciplinary matters Fines of up to $2,200 for corporations and $1,100 for individuals and partnerships apply for non-compliance with the Regulation. A breach of a rule of conduct can also lead to disciplinary action being taken under the Regulation, which can result in cancellation or disqualification of a licensee Remember: •

Verify the details provided by the applicant

•

Appearances can be deceptive. To judge an applicant in this manner is discriminatory and the Anti-Discrimination Act 1977 must not be breached. All applications should be checked in order of their receipt.

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CONCLUSION You now have completed the content and assessment for CPPDSM4010A Lease property. This module will prepare you to enter your job role with an understanding of what is expected when you lease a property in a responsible and ethical manner.

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ACT LEGISLATIONS AND FORMS • • •

Residential Tenancy Agreement Tenancy Application Form Rules of conduct – agents, salespersons and property managers

Page 18 Page 64 Page 82

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