3 min read
Author: Andrew Nicol
Managing Director, 20+ Years' Experience Investing In Property, Author & Host
Nothing strikes fear into a landlord's heart like a tenant horror story.
So this week, let’s countdown New Zealand’s five worst tenant horror stories. And the lessons you can learn.
Just keep in mind that most tenants are good, honest people. But there are exceptions. These stories are the rare – but real – horror stories that investors sometimes face.
This one came straight from my team at Opes Property Management.
A lovely-looking, middle-aged couple showed up to a viewing. They had clean shirts, polite smiles, good credit … the ideal tenants on paper.
So, they got the place.
But a few weeks later? The neighbours started complaining.
These “professionals” were yelling racial slurs at the neighbours. They fell behind on their rent. And then they packed up and left halfway through the fixed-term lease.
To round things off; they’d left the place in a mess and ended up in the Tenancy Tribunal.
Our landlord won.
The lesson: don’t judge a book by its cover. Even well-dressed professionals can turn into tenancy nightmares.
The right tenants aren’t always the ones who turn up in the fanciest clothes.
A landlord was renting out a fully furnished home.
When the property manager swung by for a routine inspection, something felt off.
It turns out that much of the landlord-supplied furniture is no longer there. The tenant had flogged it off on TradeMe.
That included the landlord’s favourite dining room table (listed in the tenancy agreement).
Worse still, they’d sold it for a measly $200.
In the end, the tenant had to spend $1,000 to buy the table back!
The lesson: Always include a comprehensive chattel list when you rent out a furnished property. And make sure to take photos.
This one is really grim.
The tenants moved out of this property. But left it in a right state.
There was rubbish everywhere. Graffiti on the walls. Not to mention broken windows and holes in walls.
It took professional cleaners 4 days to get the place back to standard.
In the end, the landlord won $10,000 at the Tenancy Tribunal.
Great. But the tenants can’t afford to pay that.
So they’re slowly drip-feeding it back to the investors at $5 - $10 a week.
The lesson: Even if you win at the Tenancy Tribunal, you might not see the money for years. That’s why you need good insurance.
Because an insurance company will pay the money up front.
An Auckland landlord rented a property to a friend. Classic mistake.
When the lease ended, the property was full of mattresses in every room, used condoms, and – brace yourself – human poop on the floor.
Despite the filth, the tenants had the gall to ask for their bond back. (Spoiler: they're not friends now.).
The lesson: Don't rent to friends. I know that sounds tough. But, it’s true. Business and personal shouldn’t mix.
Now for the worst of the worst.
A tenant in a Salvation Army property in Dunedin must have had some quite serious mental health issues.
One night at 3:30am, he smashed paintings, got into a 90-minute fight, threw chairs at neighbours. Then he brought a 9kg gas bottle into the hallway, yelling: “Boom boom, you can all die.”
Now I feel for this guy (and his flatmates) because he’s clearly got some demons.
But, here’s the twist. This all happened over 108 days (not 90). So, the Salvation Army couldn’t kick him out under the old tenancy laws.
Thankfully, the rules have changed.
The lesson: With no-cause terminations, you can give a tenant 90 days' notice. You don’t need to state the reason.
Even if you get your own tenant horror story, you can end it.
These stories are awful.
But remember, these are the horror stories. The worst of the worst.
Most tenants pay their rent on time (every time). Most tenants want a warm, dry home with a roof over their head.
But it’s worth looking at these horror stories for the lessons you can learn.
Because when you know what can go wrong … you can do something about it.
Managing Director, 20+ Years' Experience Investing In Property, Author & Host
Andrew Nicol, Managing Director at Opes Partners, is a seasoned financial adviser and property investment expert with 20+ years of experience. With 40 investment properties, he hosts the Property Academy Podcast, co-authored 'Wealth Plan' with Ed Mcknight, and has helped 1,894 Kiwis achieve financial security through property investment.
