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VCAT ruling places emphasis on appeasing tenants

24 September 2014 Elyse Perrau

A recent Victorian Civil and Administrative Tribunal (VCAT) ruling has placed an even greater onus on the management of tenants during open for inspections, and property managers and principals have stepped up to meet the new mark.

The VCAT recently blocked a real estate agent from staging mass open for inspections for prospective buyers of an eastern suburbs home.

They ruled that the agent could not bring more than a single prospective buyer through at a time, unless they had the tenant’s consent.

The ruling did not set a legal precedent, but it now serves as guidance for future cases that come before the tribunal on the matter.

Besser & Co head of property management Marcel Dybner said the only time a tenant is going to say no to an open for inspection is if there is not a good relationship in place.

“Also there are a lot of benefits of having open for inspections over private appointments, which is the alternative,” he told Residential Property Manager.

“The benefit is you are actually saving the tenant time,” he said.

“Although there may be a few people coming through at once, with good processes  say taking down everybody’s names and numbers  you are actually making it safer for the tenants.”

Tenants Union policy officer James Bennett said vendors who really want to make their tenants content about leaving the property during open for inspections could subsidise a meal at a local cafe during viewings.

"That will at least make the experience of their having to leave the house each time a more pleasant one," he said.

However, if tenants are really resistant to the idea of inspections – and they may well have good reason to be concerned about privacy or security  Mr Bennett points out it may be better waiting until their lease has expired so you can offer the property as a vacant possession.

Also speaking to Residential Property Manager, BresicWhitney director Adrian Oddi said it is important for a tenant to know, first and foremost, that you respect their home and space which you are entering.

“Ordinarily we tend to work with tenants around specific open times and we are mindful around when they are available and allow us to show the home,” he said. 

“I think the other big thing for me is that they should be compensated.

“I typically recommend, subject to what the property is worth, a fairly significant reduction in rent to show the tenants that you actually do appreciate what they are doing,” he added.

As an example, Mr Oddi said one of his rental houses, which is about to go through the sales process, currently rents for $625 a week and he has recommended a $200 a week rental discount to the tenants.

“Just whilst we are doing inspections  so if it goes for four weeks and we utilise all four weeks then the tenants get $800 back,” he said.

“If we sell it after the first week and there is no need to inconvenience them again, then it will just be for the week.

“Tenants should be compensated and they should be compensated well  I think $20 a week off, just doesn’t cut it anymore,” he added.

VCAT ruling places emphasis on appeasing tenants
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