In Sydney’s real estate caste system, buyers are high and renters low. As a renter -“ even at the high end -“ it’s quite common to feel as though real estate agents, property owners and rental managers see you as nothing more than an inconvenient source of income. Unlike the red-carpet treatment afforded to those in the market to become buyers, renters often wait for returned phone calls that never come.
Renting an investment property can be a risky business. Some tenants prefer not to pay, and it can be a costly exercise to evict someone. And in most cases rental agreements work out well, with both parties satisfied. But occasionally, the tenants find themselves living in limbo, waiting for the rental agent to announce the owners of the property they live in have decided to sell it; forcing the renter to live with open inspections and an uncertain future.
Of course, owners have a right to sell their properties. But agents have a responsibility -“ often not taken seriously enough -“ to inform the tenants what is going on. A friend received a phone call from an agent once, who said the owner of the property wanted to have a look inside. When my friend asked if the owner was planning to sell, the agent said no, it was just a regular visit. My friend agreed the agent and landlord could let themselves in, but decided to go home from work at the appointed time and meet the owner. When she arrived home, the apartment was full of prospective buyers: the agent was actually hosting an open inspection.
Luckily, my friend had lived in the apartment for a number of years and was operating on a month-by-month lease. She was able to give four weeks’ notice and move out.
Another colleague was renting a house for a year after selling, while looking for another home to buy. The agents also gave notice they planned to sell their rented premises, and told them they had to move out in three months. A month later, the colleague bought a new house and gave notice, only to be told that she was unable to break the lease; and was required to pay rent up until the day the agent had specified was moving out day. She took this case to the Office of Fair Trading and, after mediation, was granted permission to not pay rent on the house she was not living in for four weeks.
There are safeguards in place for renters, but often it’s renter beware. Once a contract is signed, it’s very difficult to get out of it. If you move into a home and major renovations start the following week in the adjoining property, that’s too bad. You are liable to pay rent for the home, whether you consider it liveable or not. And renters must think carefully before deciding to move on from a property before the lease period is up, particularly if it will be difficult to find another tenant. A tenant who needs to break a lease for whatever reason could find themselves paying the full rental cost of the property until the end of the lease period.
More information for tenants and landlords is available online at the NSW Office of Fair Trading website.