The Ins and Outs of Rental Appraisals
I got a chance to talk to Linda Wong a property manager based in Birkenhead Ray White office about rental appraisals. She joined me on my Property Chit Chat podcast.
I asked Linda when she gets a phone call from somebody who says eg “I am moving town and I've decided I want to rent my house out. What's the first thing you will do as a property manager?”
She said the first thing she’ll do is to make an appointment and meet the owner at the property they want to rent out. For her, as a rental property manager, she likes to see the actual property to get the feeling of the place before doing an appraisal.
Linda believes that when you go out to the property, you actually get to see where the location of the property is. You can actually see how the property condition is inside and out, and familiarise yourself with the surroundings. When you walk into a house you get an instant feeling about it. You can see if it’s newly renovated or something is missing or needs to be fixed, changed or is all ready and ready to rent out. Whereas in photos you don't know when those photos were taken and sometimes photos are a little bit misleading.
Being able to walk through, seeing everything, making notes and recommendations if the property needs improvement, renovation or to remove something damaged, will help you in assessment rental appraisal and tenant agreement. There are other things to consider too like the latest insulation regulations, smoke alarms etc
According to Linda, as a property manager doing an appraisal where you have not been to the property, you are required to put in the appraisal that the property has been appraised sight unseen or not visited in person and that basically indicate that the appraisal is based from the photos only and stats about rentals in that area and the property managers experience. Of course some properties you can do that easily, the photos are clear and you can see the condition etc.
Now if there's anything that needs fixing or anything damaged, you need to make sure that it is all fixed before it gets rented out because you don't want to rent a property that's really not well maintained. Because as a general rule, there will be an inspection report for a tenant about the condition of the property. When the tenant goes in, they check the report and sign it to acknowledge that it is correct. Then all parties are clear about the condition and any other things that need to be mentioned.
One has to allow for fair, wear and tear. Yes. So if you've got a sparkling clean oven when the tenant moves in and the oven is not sparkling clean when they move out, you can say it's not clean. You need to get it cleaned. This was the condition when you moved in. Although be warned cleaning is a grey area; what one person perceives as clean may not be the other person's idea.
As a property manager, it’s their duty to look at the state of the property, to make sure that we're looking after the owner's asset. And that includes a property inspection every three months; some places do it every six months.
According to Linda, they don’t rent out a property to anybody that hasn't come to a viewing. They've had some interaction with them prior and generally meet them up at the office and go through the tenancy agreement with them and explain it..
Listen to the full-length interview to learn more about the Ins and Outs of Rental Appraisals by clicking this link: www.goodtonic.co.nz/property-chit-chat
Til next time,