My friend of mine uses a property manager to manage a rental property she owns. She found out that the tenant had been late by a couple of months in paying rent and utility bills (in SA, water bill etc MUST remain in the name of landlord). The agent put the tenant on a "payment-plan", (without firstly asking for permission from the landlord) so the tenant could start paying it off week by week, in addition to the tenant still paying her weekly rent. Eventually, the tenant was successfully evicted for not keeping the payment plan agreement. The tenant has now left with no contactable details (address, phone etc). My friend is therefore about $2500 out-of-pocket for those unpaid tenant bills. There is nothing in the landlord-agent agreement to say that the agent can enter into payment plans if the tenant does not pay bills. Our question is: would she have a small-claims case against the agent for the loss of this money on grounds of negligence, or duty of care etc? Appreciate your comments guys!!
Does She Have a Strong Case against Her Property Manager?
Comments
If only!!! A claim against insurance WAS made. Insurance policies do not cover unpaid bills, only rent unfortunately. The bond was used via the insurance company to first pay unpaid rent, nothing was left of it for the unpaid bills. The $2500 out-of-pocket was AFTER insurance claim was finalised. And yes, she has the person's drivers licence photo (address out of date of course), medicare card number (no contact details on it of course), but what can an ordinary citizen do with that information to locate tenant legally? All information on original application is of little to no use, e.g. old address are old tenancies etc, not now relevant etc!!!. She thought of all those obvious things!
Oh wow, I thought it was made up of rent too.
That's a really horrible person to rack up those bills, of which THEY used and then just disappear.I'm not sure what you can do legally, but I really hope it's a positive outcome !
I'll keep an eye on here so I know what can be done with the advise of those who know more :)In QLD you can apply through QCAT to order other government agencies (RTA etc) to provide you with the new address as soon as the person changes it, you then can use that address to raise whatever legal case you want to do. Likely something similar exist in SA.
What bills remain in the name of the landlord?
I don't know SA but in NSW, it's only water and water wouldn't be anywhere near that $2500 for years. Anything else would be the responsibility of the tenant and after the tenant is gone, then the utility companies chase the tenant.
I pay utility bills for a rental I have but I manage it myself. I get better rent this way. If my renter stopped paying I would toss them out.
Think you need someone with specific knowledge of this and the lesson is don't use an agent.
Outstanding water bill is about $690 - water bill MUST be in landlords name in SA.
Outstanding electricity bill is about $1800, this is in landlords name BECAUSE there is solar on house and tenant is being charged for kWh from solar at same rate as network rate. It is a big solar system which generates a credit each quarter, so if it was in the tenant's name they would benefit from the credit and get 100% free electricity. Now don't give me flames for being greedy etc etc. This solar system was installed before it was rented out and cost several tens of thousands, so why should the tenant get the free benefit for all this capital investment. They are only being asked to pay for power as if ALL of it came from the grid -there is nothing unreasonable with this are they are not being taken advantage of.if it was in the tenant's name they would benefit from the credit and get 100% free electricity
Yeah, I'm not up on how solar credits work. I didn't have several tens of thousands to pay for solar when the going was good.
I'm stuck on
get 100% free electricity
So someone else is getting the money for that free electricity?
This is the problem with nice stuff, you can't take it with you. I would have let them have the free electricity in their own name and charged more rent.
I have a house with six people in it. I'm putting in two new bathrooms so there'll be 3. My renters will get the free benefit of that (several tens of thousands) capital investment because they're good tenants and I hope it encourages them to stay longer. Yes, they will pay more rent but somewhere down the track when I sell that house, it is worth way more than when I bought it, with the addition of that capital investment. Same for your solar.
So someone else is getting the money for that free electricity……….? Yes, of course, the landlord. Why shouldn't they get the benefit of the solar, they were they one who spent tens of thousands installing it. Not many landlords would do that for free solely for the tenant's benefit now would they!!!! Remember, the tenant is not being ripped off, they are just paying for power at the same grid rate.
Not many landlords would do that for free solely for the tenant's benefit now would they!!!!
and you/she didn't
This solar system was installed before it was rented out
So when you/she lived in the house, it was installed for yourself/herself.
Just up the rent next time and let it go. You've (they've - whoever it is) already got the money from the grid.
@snook: That's exactly the right approach.
Hey look, most of the electricity is free or if you're good, you might get something back, depending on how you use it.
But because of that I'll ask 100$ per week more in rent. Alright ?
Sometimes people make life too difficult.
That is NOT the right approach.
Why… because potential residents will see the price online/on-leaflet and just bat it away.
You're property will sit being unoccupied for a much much longer time, and eventually you will lose much more money.
I feel like the "friend" did the right thing initial BUT the owner didn't pay their price, and that price to the owner was time. Time to make sure payments were in-line and that their property was not being destroyed. That's what a responsible home owner would do. I mean, you wouldn't leave your Ferrari outdoors during a hailstorm.***number crunching
It's a hunch but I'm guessing the $2,500 is minus their bond.
So if the property was being rented for $380 p/week (guestimation), the bond is about $1,520.
So the residents actually owed something like $3,900-$4,100 at the end of the payment plan.
I'm guessing they decided to move as soon as the "payment plan" went into effect.
So they probably moved away within 2-3 weeks.
And I'm guessing the payment plan was something common like $100 extra every week.
So before they went into the payment plan they were probably in around $4,500 in arrears.I'm guessing by not paying for "a couple months" probably means something to the order of 2-2.5 months.
Water fees for that period would've cost ~$0 in over-use (most people), or ~$80 for total water, or ~$200 for total bill service.
If the rental arrears are something like 10 weeks, $380… that's ~$3,800
$4,500 - $3,800 - $80 = $620 for electricity
***end number crunchingSeems like they were living it up, and not paying.
I would be more worried that your friend didn't notice a ~$5K hole in his bank account, and found out through the property managers. He's definitely not an OzBargain tight ass!
Where did you get this from?
Besides, who the hell uses $700 of water in "just a couple months"?Are they renting out Sea World or something??
It just says $2500 for rent, electricity, water.
Surely unpaid rent is the bulk of the missing coin.
Electricity costs can stack up, but not that fast.
Water, that's almost guaranteed to be a small sum.Was there another post?
I didn't see anything saying the electricity was $1800 or the water was $700.Oh cheers for that, totally missed it.
Well, then, why did the GOCAT9 state in the OP the fee included unpaid rent.
Something doesn't add up.
Something also didn't add up with their previous thread about the same problem.I don't think they're upfront to the OzB community.
Shame, sha-shame.
Pretty sure charging the solar output consumed at the house at network rates to a tentant would land one in hot water….
No the lesson is don't use a bad agent, good agents, or at least agents who do their job properly, save you the massive headache of dealing with tenants.
Is this really your friend's situation, or a variation of your previous situation?
https://www.ozbargain.com.au/node/255787?In future, raise rent and not try and make money off solar power? And make it fairer and equitable for all?
Sounds like you've hit the jackpot!
There is no friend
Now don't give me flames for being greedy etc etc.
Hey, I know where you are coming from. However, it really IS my friend's situation on her rental property (originally she lived there when the PV was installed). The situation you referred to was MY rental property, but that is now successfully resolved in my favour. What IS in common though between the two properties is the reason for the power bill having to be in the landlord's name. If it WAS in the tenant's name, they would not only have free electricity, but a big credit windfall on top of that. Now you wouldn't want that would you!!
So is it the same property manager? It sounds like the property manager made the same mistakes with the payment plans and not keeping the landlords up to date with what their tenants were paying. I was thinking of the similarities in the cases even before I saw that both threads were from the same account.
Did the tenant give any personal references before they started renting the property. Check to see if the referees know the tenant and how to contact them.
If you know the full names of the tenants, see if any of them have facebook profiles or other social media profiles under their name and attempt to trace them that way.
Good advice POINTSCRAZY. Yes, it is the same agent that manages her property too (I recommended them to her a few years back!!!) Thanks for the advice about facebook etc. I did try that, but came up with nothing. Plenty of people by the same name but none in Adelaide! So, I'm stuck, unless the only thing I thought off was to sue the agent or give the debt to a debt collector and let them try and find the tenant.
Yep, already did that - they were mildly helpful, said they could not give me legal advice. I called a free legal aid number and they said I should have a case against agent if the contract did not permit them explicitly to do this. This was general advice however. My landlord friend is currently overseas, so when they get back next week, I was going to suggest they sue agent (just a small claims action).
@GOCAT9: If your friend is going overseas on a regular basis they can appoint a General Power of Attorney to pay bills and manage their affairs while away.
This could include monitoring that Rent is received (and if not, why not).
You must have done your maths, in how much time you would amortise the panels, right?
Just add that on a monthly/weekly basis, and for you it's a Zero result equation. Win Win for both sides.
If you are afraid that the tenant could make money "with YOUR installation" then don't rent it out.
Are you renting out the house, but the tenant is not allowed to use the pool, because you want to have a swim in it ?Outstanding electricity bill is about $1800, this is in landlords name BECAUSE there is solar on house and tenant is being charged for kWh from solar at same rate as network rate.
So this in not really outstanding bills you have to pay, because its money you have to pay yourself.
Yes, I have done my maths. The panels will pay for themselves in about 4 years! If I added to the rent as you suggest, it would increase the rent by about 38%, - yes, I have done the maths!! Nobody would rent at that price. Does that make more sense now?
"So this in not really outstanding bills you have to pay, because its money you have to pay yourself." Yes, you could look at it that way, however, whichever way you look at it, it is a loss of at least 'potential' income. Remember, at the end of the day, the tenant 'ate the steak….' You can't complain AFTER you eat the steak!
@GOCAT9:
The panels will pay for themselves in about 4 years.
By charging the tenants the same rate as the electricity provider would?
From what I know they pay off them-self in the range of 6-7 years.Say you paid $5000 for installation, and amortization is in 4 years. You add ( 5000 / ( 4 * 52 ) another $24 a week in rent because of that.
To increase your rent by 38% because of that, the weekly rent would be $63, with $24 on top of that would be $87 per week. For a house, right?Might be time for me to move.
But you bought the steak and left it there. If you didn't want anyone else to eat it, you should have taken it with you.
Everyone knew you couldn't take solar deals with you if you left the property. You're trying to hang onto something that has gone off.
Actually, the installation was more like $25k at that time - now costs about 1 third or quarter of that!! Yep, 4-7 years, in that timeframe!
Snook: She has not left the property (Elvis is still in the building - the steak is being kept warm!!). She is only renting it, she still owns it! She is still entitled to the FIT, until such time as it is sold to another person at which time the FIT transfers to them!
@GOCAT9: I know this is not drifting away from the original issue, but she paid 25K$ for panels, and this within the last 4 years, as they have not amortized yet. What did she put up? 15KW system? When was the installation?
Actually, the $25k she paid was not just for panels - it was for panels AND inverter AND installation. It was installed more than 5 years ago and was about 10kW in size! It was CHEAP for that time if you check!! Hope that helps.
@GOCAT9: sometimes, people make bad investment decisions, in this case, (a lot of guessing on my part), if the total cost was $25k 5 years ago and it's now say $10k for the same thing, she may not be able to recoup the cost quickly, compared to if she had done it recently… Similar to buying a new computer.
Therefore, if it was reasonable to say, estimate electricity use of $200/month, then rent should be $50/week more than market, with electricity included. If the capital cost is more than $200/month (ie the $25k over X years), then that is her cost to wear.
@tomsco: $200/month is quite a bit. Sure, reasonable for a 10K system. But that's only during the day.
If you heat with electricity, in winter, when the sun is down, you get hit with a fat bill with or without Solar panels.
It is understandable that some people would prefer the arrangement described.
Only thing the owner could have done, was to request the electricity to be paid in advance, or a bond of $1000, just, as in this case, the tenant did no pay the bills.Bluedufflecoat: I know what you are trying to say, but your argument is totally flawed!! You have totally ignored the fact that current PV systems, whilst at cheaper prices will get NO FIT. The investment five years ago, at a much much higher capital cost, is FAR better because of the much better FIT of 54c/kWh obtained back then and applicable until 2028. This totally turns your argument on its head!!
@GOCAT9: so I don't understand why your friend is upset? I'm not familiar with the (what I assume FIT = Feed In Tariffs). If she is indirectly making money from electricity (at least until 2028), then charge more rent, throw in free electricity.
"What IS in common though between the two properties is the reason for the power bill having to be in the landlord's name. If it WAS in the tenant's name, they would not only have free electricity"
"serpserpserp on 04/07/2016 - 20:44
I'd like to know this too. Is this a common practice?replyvotesreporthide
+4 votes
GOCAT9 on 05/07/2016 - 09:17
The meter that the tenant is billed from is not connected to any PV system. In any event, a friend of mine has a rental property with a PV solar on it. She gets the power bill in "Ozbargainers, I present to you a liar with an either an insultingly low opinion of our cognitive abilities, or a total ignorance of the utility of archives…
You and your friend both seem unfortunate to have lousy tenants.
OP, whatever the reason is…having tenant's name on utility bills is just like digging your own grave yard.
Why is that?
Apologies…typo…I meant landlord. haha!
Hey guys and girls, yuze all getting a bit off topic here, but let me finalise the solar vignette by saying again. Yes,as TERRYS pointed out, what the two properties and different landlords have in common in that the electricity accounts are in the landlords names. Some people are a bit hard of hearing, so let me speak up a little: IF THE ELECTRICITY BILLS WERE IN THE TENANTS NAMES THEY WOULD NOT ONLY GET VIRTUALLY UNLIMITED FREE ELECTRICITY, BUT THEY WOULD REALISE A WINDFALL OF MANY THOUSANDS OF DOLLARS PER YEAR IN FEED-IN TARIFF. Now back to normal voice level. I hope all those OZ who did not understand why the landlord retains the bill are a little wiser now!!
"MANY THOUSANDS OF DOLLARS PER YEAR" … LOL
You seem to be very smart alec and enterprising where capitalising on your investment property is concerned, yet was not vigilant and on top of your property manager's management of your property.
If you don't like the advice you are given here then don't ask. No need to be a smart ass with those comments and ALL CAPITAL LETTERS. It doesn't help you here and make you look like a D*CK (hope the upper case I used here helps you understand what you are trying to do).
Cut your losses and move on please.
No, my point was that when you first posted regarding your hassles, you denied that you were claiming this windfall . Your words are quoted above in your reply in that thread dated 05/07/2016 - 9:17.
I hope you are a little wiser now. You need to remember inaccuracies for a long long time on the 'Nets…
This whole situation seems to revolve around (a) as a landlord not staying on top of the investment and (b) highly complex arrangements with respect to utilities billings.
By all means, attempt to extract what you can from the property manager, but my intuition tells me that by the time this gets settled, any payment is likely to have not been worth the hassle involved.
With respect to all this utilities billing, why does the landlord not simply advertise "free utilities" and adjust the rent recoup? Not only would this save a lot of hassle, it would appear this would also be beneficial with respect to claiming lost rent from landlord insurance.
it is due to taxation issue.. claim cash from tenant but told ATO that electricity expense is part of rental fee.
Don't want problems? Don't be dodgy.
Also hire a lawyer instead of trying to trawl for free advice on the internet.
I advise everyone to stop feeding this troll.
Brilliant, the tenants revenge.
Yeah, to be honest, I would feel like the landlord is being pretty dodgy if they are trying to on-charge me electricity from the solar panels. Are you giving a large discount if they pay on time? Are you giving them off peak and on peak rates?
I feel like you guys have been a bit too greedy this time…
bargains4lyfe: are you trying to say that the tenants should have free electricity from the solar? This is not a charity service I am running nor a scamming service. It is as simple as this: if they eat the steak then they pay for the steak (at normal steak prices)! The rates that they get charged are less than the standing offer rates, you can't ask for much more than that. Do they get a discount for paying on time, well NO, do they get charged for paying late, will NO also!!
so dodgy and greedy.. triple dipping
1. Claim depreciation of solar panel
2. claim electricity bill as expense.. but charge tenant full amount
3. Keep your own solar rebate…cuteduck: You are soooo… far of the mark here. Let me correct your misconceptions, claim depreciation, NO!! claim electricity bill as expense, NO!!, keep your own solar rebate, OBVIOUSLY!! Who else should get it? I paid for it, remember!
How do you bill your tenant for electricity? Do you provide them with a copy of the bill itself, or do you avoid this because it shows a credit due to having solar…?
She is totally transparent about the whole billing process! The tenant gets a copy of the retailer's bill to show what the tenant took from the grid (in kWh) and then gets another bill from my landlord friend showing what the tenant used from the solar PV, payable at the SAME c/kWh as the retailer's bill, but is cheaper because the tenant does not get asked to pay GST on the PV component!
@GOCAT9: That's ridiculous. The tenant has the right to shop around for an electricity provider that suits their needs and therefore have the electricity in their own name. Why should they pay for your bill when you've determined what works best financially for you alone? A tenancy arrangement is a two-way street, not simply there to benefit you alone.
Next time include electricity in the amount of rent they pay. Cuteduck was correct, this behaviour is completely dodgy and greedy.
I don't agree: Nobody said the tenant can't choose provider, did they? The provider that my landlord friend uses is already the cheapest on the market, so how can you beat that? Anything else that is "dodgy and greedy"?
@GOCAT9: You won't allow the tenant to have the electricity in their name, therefore you are restricting their choices. At the end of the day, you invested in solar panels and then chose to rent that property out. Tough luck if the tenant can then get 'free electricity'. It isn't free, the property you are renting out includes solar panels which is a feature of the property. Charge rent accordingly, but don't decide you can charge the tenant whatever you'd like in electricity as a utility.
Good luck to any poor tenant that rents a property from you.
OP now you said "I PAID FOR IT". So….is it YOU or your friend?
She paid for hers, I paid for mine!
Isn't that what paying landlord insurance is for?
It does however seem strange that no identifiable information was provided on application to the Property Manager.