A local trainer who has just returned from an international conference was surprised to discover all the fines and fees that overseas property managers can charge tenants.
Trainer and keynote speaker Darren Hunter, who recently spoke at a property management event in Texas, noticed the major difference an under-legislated market has on tenant fees and charges.
“Australia, as far as I’m aware, is really the one of the only countries where the tenant is a protected species when it comes to fees,” he told RPM.
“It’s just interesting that tenants also have credit cards and get charged credit card fees and bank accounts where they get charged bank fees, but when it comes to property management, they’re not allowed to be charged fees other than direct costs like water or rent.”
While at the conference, Mr Hunter learnt that there are almost 100 different fees that tenants can be charged depending on the agency.
“It’s very normal for every agency or most agencies to charge tenants a late rent fee; usually it’s about 5-10 per cent of the monthly rent and usually if they’re three days late,” he said.
“There’s a risk mitigation fee if tenants don’t come up to 100 per cent on the application form and fulfil all of the checking criteria, so the risk mitigation fee is the assumed extra work that the agent may have to do on that particular tenancy.”
Mr Hunter also said pets attract various fees for tenants such as a fee for every unauthorised pet, annual pet inspection fees and a pet lease sign-up fee.
“Another common fee is the lease application fee or a tenancy application fee and there’s also a lease sign-up fee, which is per person over the age of 18.
“There’s a tenant no-show fee if a tenant doesn’t show up to an appointment and a fee for each unauthorised occupant or disconnected smoke alarm found during inspection.”
According to Mr Hunter, fees can only be charged for faster services such as rush move-in fees or getting a bond back within 14 days.
“There are some agents that earn as much if not more in income from the tenant than what they actually do the landlord,” he said.
“Obviously some of these fees are money makers and some of these fees may not actually be charged or charged very seldom, so they’re only there to discourage bad behaviour.”
[Related: When is it time to let the tenant go?]