Tough Situations: How to Approach Difficult Tenants

As a property investor, difficult tenants are a risk that comes with leasing out a property. While most residents are reliable, there is still a chance that you might encounter at least one or two troublesome tenants in your investment career. Even though these type of tenants can make for stressful situations or can potentially harm the return on your investment, it is important to stay professional and calm through tough circumstances.

There are many reasons why you might want to take action against troublesome tenants. These might be because of property damage or subleasing, illegal activities, loud and disruptive behaviours, or the failure to pay the rent on time. In some of these cases, the tenant may be unaware their conduct does not comply with the tenant agreement and will only need to be informed through a written letter or formal meeting. However, in all of these cases, you do have the right to initiate eviction as long as you follow the legislation governing tenants in Western Australia.

The most important thing to remember when addressing an issue with your tenants is to remain professional. Be courteous, respectful, and treat your interactions as business meetings. Having excellent negotiation skills will make solving issues go more smoothly.

When problems arise, it is imperative you address them promptly. Ignoring issues for extended periods will likely cause them to worsen. You can prevent them from intensifying by regularly communicating with your tenants about maintenance or other matters and inspect the property as often as your local legislation allows.

If your tenants continue to violate the agreement, you can issue a formal written warning in the form of a Notice of a Tenancy Breach. In this notice, you will need to detail what the problem is, any information about how it was previously addressed, and what you will do if the problem continues. You must keep copies of all documents or interactions you make with your tenants in the event of eviction or a court case.

If the tenant happens to ignore your breach notice, you might need to resort to eviction. Although eviction is considered the last resort by most property investors, sometimes it is necessary to resolve the issue by taking legal action.

In Western Australia, when a breach notice is ignored for over a 14-day period, the landlord has the right to issue a notice of termination. This notice gives tenants a seven-day time frame to vacate the property. If it is ignored, the landlord must apply for an order for possession in the magistrate’s court within 30 days. If this order is also ignored, the landlord can apply for a property seizure and delivery order whereby a court appointed bailiff will remove the tenant on their behalf. Most times, it will not come to this stage, but it is in your best interests to be prepared if it does occur.

Before a difficult tenant comes along, it is a good idea to evaluate your ability to handle a stressful situation. In preparation for a worst-case scenario involving malicious damage or loss of rent, you can take out landlord’s insurance. You have the option of doing this when insuring the building.

As a landlord, you have the option of self-managing your property or hiring an agent to manage it for you. If you choose to hire an agent, they will charge a fee (usually 10% of the rent) to take care of any issues that may arise.

As a private manager, you can join the Landlord’s Association for a small fee to receive ongoing advice on how to manage your property. You need to familiarise yourself with and stick to the legislation of your region and keep records of all tenant-owner interactions. By doing this, you won’t be pulled up for misconduct if something were to go sour. You might also like to consider creating a rigorous tenant application process to prevent the likelihood of accepting a potentially difficult tenant.

At Select, we offer quality, no-obligation, and free advice to help you reach your financial goals. If you are interested in investing in property and are unsure about what to expect as a landlord, we can offer you advice that will help you through the process. Organise an appointment with one of our friendly brokers, or give us a call on 08 9417 3399 to discuss your options.