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In today’s information age anyone can find anything they ever want on the Internet. There is no lack of information, by far, there is excess more often than not. In today’s world mothers arrive at the doctors rooms with 50 pages of data, printed from the internet, of what can be wrong with their child. There only reason for a visit to the doctor is to confirmation what they think they already know is wrong. This may not be such a good practice, but it is no joke. From doctors to property investors and tenants, anyone can find out anything about everything. For property investors this means that tenants today also have information at their fingertips and property investors must take heed to that, or else!
To give you a simple example, in today’s world we get inquiries for rental flats in the Johannesburg CBD by potential tenants who are sitting in Internet cafés. How is that for access to information? Pretty cool. Though this is great, and businesses run easier and faster by the day, knowledge also travels at the speed of the Internet, which at a minimum is at the speed of a 56K modem. Still pretty fast when you consider the information gather techniques of yester year.
Now imagine a tenant that is upset with a landlord. The tenant visits the internet café to learn more about tenants rights, then researches and comes to the conclusion that his rights are being abused or that the landlord is behaving unlawfully. What then? Well then the tenants can take action for free, through the Housing Tribunal and lay a complaint. The the landlord must then deal with the consequences. Not a comforting thought for many landlords.
Often, we find that property investors and proud landlords are mainly focused on their jobs and professions. They are smart and professional people, but when it comes to property, it is not their profession. Such landlords count on agents, or other sources that seem reliable, and hope they are do the right thing. To them, it takes far too much time to research all the laws and governing municipal rules and regulations, court cases and so forth. But the unhappy tenant easily takes a few hours after, or at work, to do just that; research. The tenant is motivated to find a solution to the problem that seems to make them unhappy, whatever that may be.
The property investor on the other hand, often has no clue of what is going on, or even if he or she does, they have more pressing issues to deal with, such as their day job or businesses, or they just heed to the many so called “gurus” and motivational speakers that emphasize how property investing doesn’t need to be a “hands on business”. Though this is very true, for such a business to be “hands off” there must firstly be a set of processes and procedures to follow. Correct legal documents and good agents have to be put in place for things to run smoothly – and that by itself takes time and effort. The notion that property investment can be a case of “buy-rent-and-forget” past-time doesn’t exactly work in the real world, or at least not without some major risks.
So, the property investor leaves the matters be, or leaves it to the agent, until such time as, out of the blue, they end up with a major problem to solve. By this time it is too late to fix the problem quickly, cost effectively and easily.
Property investors need to take heed to what is going on. They need to ensure that they are fully conversant in matters pertaining to renting and the rights of their tenants. They need to pay as much attention to such matters as the do when it comes to finding best practices on reducing the management associated with their properties.
Whether you are buying, selling or renting property, it is a peoples business. No software package can offer a golden formula and financial spreadsheets do not take into consideration the human factors of the business. As access to information increases and tenants become better informed, landlords must keep pace and strive to gain the knowledge and expertise required in order to manage both the legal and social aspects of the buy-to-let business. Investing in such skills could be the best investment they ever made by any property investor.
Read more articles on letting on the Campu Property Investor Letting Workshop section.
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