FREQUENTLY ASKED QUESTIONS

Do we have to declare any income on a property rented out?
Yes, rents received are income and need to be declared. Obviously you can claim for such things as maintenance costs, management fees, interest on mortgages and depreciation. We are not tax experts and recommend that clients get independent financial advice. Information is also available on the Internal Revenue Service website (www.irs.gov). There is a booklet available “Rental Income” advising property owners on the tax implications of receiving income from a property.
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Do we require special insurance if we rent our property out?
You need to advise your insurance company that the property is to be rented. We recommend that clients also take out what is normally called the "Landlords extension". This is similar to a contents policy which covers the landlord’s fixtures and fittings.  Ideal Property Management Group assesses a $99.00 fee to owners per tenant for legal protection services provided to the owner if need be. Real Estate Risk Management (www.rerm.com).
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How do you find tenants?
We place advertisements in the local papers, on the internet and contact relocation companies where appropriate. Advertising is at the expense of the property owner. You are only charged the cost of the advertisement (no loading fee is put on it) and Ideal Property Management Group name is not mentioned. So you are not paying for the advertising of our company name. Telephone calls come directly to IPM Group and potential tenants are personally shown through the property. No keys are given direct to potential tenants to view the property and the property is not left open and unattended for potential tenants.
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What do you do to ensure I get the best tenant?
Nobody can guarantee you the perfect tenant, however experience has shown that following good procedures does minimize the risks. All prospective tenants are required to fill out an application form. This form gives information about the tenants and they are required to supply details of personal referees and their current or previous landlord. It also authorizes us to do credit checks. All prospective tenants are reference checked and because we personally show them your property we are also in the position to form a personal opinion of them. This is the main reason we do not 'subcontract' this work out or employ people solely to view properties and find tenants. We do decline tenants who have applied for properties when the reference checking does not satisfy our requirements.
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How long does it take to find a tenant?
This depends on the market and the time of the year. The rental market is very competitive especially with the number of new homes and apartments available and continuing to be built. The number of available properties has increased and the presentation of properties has vastly improved.
It is important to:
• Present your property in excellent condition.
• Price the property at the correct level (sometimes it is better to take $50 less a month and have little down time than ask top price but have the property empty for several months). If you are purchasing a rental property and the selling agent advises you that the property will rent for "XYZ", ask them how many investment properties they own or how many properties have they personally rented out in the 6 month period prior to marketing the property.
• Remember rents have not increased significantly over the years. The value of the property increasing does not automatically indicate that the rental price increases. We would allow 3 - 4 weeks to find a tenant. It could happen sooner or it could take a little longer.
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What is the difference between a fixed term & periodic tenancy?
The normal type of tenancy in California is referred to as a periodic tenancy (Month to month). In general terms a periodic tenancy requires that a tenant must give 21 days notice prior to vacating a property. If the owner of the property wishes to shift back into the property they must give the tenants 42 days notice and if the property is sold the tenants must also be given 42 days notice to vacate, once the property owner has an unconditional purchase agreement. Should the owner of the property wish the tenants to vacate for any other reason 90 days notice must be given.
A fixed term tenancy (Lease) is exactly that. The tenancy would commence on a fixed date and terminate on a fixed date. Notice to either party can not be given. So as the owner of the property you can not give the tenant notice because you wish to shift back into the property or because you have sold it with vacant possession.
It is important that you keep us informed of your long term plans so that we can ensure that if you are returning to your home or wanting to sell it that the right sort of tenancy agreement is in place.
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Can I have specific clauses put into the tenancy agreement?
All tenancies are subject to the Residential Tenancies Act and all clauses must comply with the act. Any clauses outside the act are unenforceable even if signed by the tenant. If you wish to have specific clauses please discuss them with us.
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Do you do an inspection prior to doing the tenancy agreement?
The tenancy agreement is done at the property with the tenant. We request that the property is completely empty at this point and the agreement completed is carbonized. A joint inspection of the property forms part of the tenancy agreement and allows for any defects to be noted.
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How often do you inspect the property?
Properties are inspected 3 times a year. This is over and above the initial inspection done with the tenant before the tenancy commences or the final inspection done when a tenant moves out of the property. Tenants must be given written notice of the inspection (a minimum of 48 hours) and inspections can be done only between certain hours.
Should problems be experienced at an inspection follow up inspections as required will be carried out.
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Who should maintain the gardens?
If you have extensive gardens and wish particular care taken of plants it is recommended that you organize for a gardener to maintain the gardens on a regular basis. Sometimes owners also pay for lawns to be done as well.
If the gardens are only small and the lawns easy to maintain it can be the tenant's responsibility. If you have a lawnmower that you can leave behind at the property this often helps.
If you have a multi unit property (two or more units in the same building) we will organize regular lawn mowing services for you. It is difficult to ensure lawns are done if you leave the responsibility to 2 or more sets of tenants in the same building. Your property will then start to look overgrown and untidy.
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Do you charge extra for organizing maintenance?
There is no extra charge for organizing everyday maintenance (e.g. plumbers, electricians, small maintenance jobs etc). However if you require a refurbishment job or a major project to take place we do have an hourly charge for overseeing this. This charge covers our time, gasoline costs when visiting the property, telephone calls etc in ensuring the job is completed to specifications.
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How do we pay for repairs/maintenance?
Trades People employed for such work forward their accounts to IPM GROUP. We pay them on your behalf out of rents collected and the charges show on your monthly statement. We also request that each owner leave a credit card on file or specified dollar amount with us so we have funds to cover large maintenance expenses. This is in case the property is empty and no rental money is coming in or the work completed is of a major expense (done with the owner's permission given prior to start of work).
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Should we leave our furniture and rent the property out furnished?
Some properties are rented out furnished however these tend to only gain short-term tenancies. You will find you have additional wear and tear on your furniture and you will be trying to rent your property to a more limited market (most potential tenants have their own furniture).You do need to be aware however that you as the owner of the property would be responsible for the maintenance on these items.
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What if I decide to sell the house?
You can place your property on the market while tenanted. However, there are processes under the Tenancy Act that must be followed and we can advise and follow these through for you. If you have a tenant in your property, who’s on a fixed term tenancy you must sell that tenancy with the property. It is important that you have a real estate agent that is a good communicator (we have in house agents who are versed in current Real Estate law) and can organize with your tenants set times for showing the property to potential purchasers. It is important that all parties work together in this process causing as little disruption for all parties concerned. Often the owner of the property will reduce the rent for the tenant while the property is being marketed.
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Who collects the rent and when does it come to me?
At the beginning of each month we compile a full statement for property owners of the rents collected less all payments made on behalf of. The balance of the money is transferred by way of check within 10 working days from the beginning of that month (this allows for all of the rent money to clear). Timeframe may vary depending on the distance of mail transport.
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How do you account for my money and is it safe?
All rents and any other moneys received on behalf of an owner are paid into our client account. This account is specifically for owners and does not form part of the operational bank accounts of our company. All payments made on behalf of the owner are also made from this account. Each owner's transactions are individually identified within this account and the account is balanced on a daily basis.
Owners are supplied with a monthly statement, which identifies all transactions during the month.
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What is your availability at weekends and after hours?
We effectively operate 7 days a week. Our office is open between 9 am and 5pm Monday to Friday. Should a tenant have an emergency after hours or over the weekend they have access to a cell phone number in order to contact us. Mighela answers this phone if an issue of an urgent nature takes place.
The office is not open during the weekends, as these are the main days for showing prospective tenants through properties. Responses to advertising happen even when the office is closed.
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Can you guarantee that our house will not be damaged?
Nobody could give a guarantee of this nature. We are not at the property 24 hours a day 7 days a week, however we do our best to ensure your property is looked after. We do regular inspections and if there is a problem bring it to the tenant's attention and then follow up to see if it is rectified. If at the end of the tenancy something is not right we endeavor to come to an agreement with the tenant. If this is not possible we will put your case to The Tenancy Tribunal for them to make an independent decision on the matter.
Owners do need to be aware, however that there will be wear and tear on the property and at times accidents do happen.