A PM director has shared his top tips to help get ‘holiday’ rental arrears back to healthy levels.
Core Property Management Consulting Australia managing director Vasili Hadzellis told Residential Property Manager the first few weeks of the New Year can be tough for property managers.
“In the first few weeks of a new year, property managers come back to an arrears report that typically has an extra page in it - or two - but they are also out and about showing available property to high volumes of prospective tenants,” Mr Hadzellis said.
“However, while the letting fee account might be increasing nicely, the management fee balance takes a bit of a hit with those tenants still on Santa’s naughty list and not making rental payments.”
1. Hour of power
Mr Hadzellis said one way to bring rental arrears back into check is by putting in place an ‘hour of power’ where all PMs are on the phone at the same time with a goal set as to how many rental payments can be taken over the phone.
“The PM with the highest total of arrears reduced during ‘hour of power’ gets a prize,” he said.
“This only works if you have EFTPOS facilities or online credit card services setup in your office, which leads me to my next tip.”
2. Obtain EFTPOS facilities
Mr Hadzellis said calling tenants and asking for a payment over the phone is so much easier and also provides a level of convenience that is now almost expected by your customers and clients.
“More beautifully, you can say to your tenants ‘I can take the payment over the phone now if you like’ when they tell you they’ll make the payment tonight online to hurry you off the phone,” he said.
“Speak to your bank looking after your trust account – I know most right now are doing good deals on merchant fees and terminals.”
3. Instant messaging
Mr Hadzellis said if you haven’t got it in place already, the ability to SMS tenants through your rental management software is something you should be looking into.
“Namely REST and Console have some great SMS plans that allow you to SMS your tenants straight from the program, automatically reminding them of the amount outstanding and how to pay.
“It also gets recorded on their ledger and in communication logs with the tenant.”
4. Payment plans
Mr Hadzellis said you can also offer first-time rental arrears offenders, who may have edged over 14 days, the ability to go on a payment plan and make smaller amount payments to bring down their total owed.
“Make sure you are clear on the amount that will be paid and how often, and don’t’ forget to let your owner know.
“When having conversations with tenants about rental arrears remember, be firm but fair,” he added.
[Related: 5 tenant warnings to watch out for]