Just recently my tenants gave me a notice to vacate. They’d been living in my house for close to 2 years and now wanted to find something bigger for their growing family.
I immediately thought about how much I used to hate the confrontation with tenants when trying to give them the long list of things they needed to do to get their bond back.
You might be surprised to hear, even the smoothest tenancies can hit a snag at the end when it comes to cleaning up, moving out and returning the bond. I’ve had plenty of great tenants turn very difficult at the end.
I’d do as little as possible before the tenant actually vacated and deal with all the problems after the tenant moved out. Wrong! That’s the hard way to do it.
Managing your property is running a business, after all.. You have to think forward and be a step ahead of the game. So being proactive is the key and not waiting for the problems to find you.
Today, I’m going to share with you my exact 9 steps that I follow to avoid problems with my tenants when they move out. As an example, lets run you through my most recent tenants from a couple of months ago.
Don’t forget to read to the very end as I have provided a bonus download of attachments and email copy that I used and I want you to have them so you to can do the same.
1. Receive notice to vacate from tenants
On January 10th, 2015 I received an email from Ben and Jess with news they were looking to move out.
Here’s the email they sent me..
Technically speaking, the notice to vacate should have been sent via post or hand delivered. However, I have instructed Ben and Jess to send all communication directly to my email so this notice was sufficient.
Note: If you’re the one giving the notice, ensure that you read up on the relevant laws in your state as to the form (template) you need to use, how to deliver it (post, registered post or hand delivered) and the amount of days notice required (plus extra days for postage) if you’re posting it.
However most tenancies end via the tenant giving notice so this story is a good example for you to follow.
2. Confirm the notice to vacate
After receiving the notice, I immediately called Jess and thanked her for taking good care of my property during the last 2 years. I told her I’d email her today to confirm the balance of rent she owes up to their vacate date and other tips to help them get their full bond back.
This conversation was informal but very important.
First of all, she felt appreciated for looking after my house.
Secondly, she knows I want to help them get their full bond back (this mindset is important).
Thirdly I got them thinking about paying off the balance of rent owing now (so they don’t get tempted to use the bond to pay the rent).
Note: If you were the one giving the notice, a follow up call to confirm they got the notice is important. If you hand delivered the notice, it’s always important to get them to sign your duplicate copy of the notice saying they have received the termination notice you gave them.
I always prefer if I can to hand deliver termination notices, that way I am 100% they received it and I don’t have to wait the extra 4 days (on average) for postage.
3. Email your tenant (or send letter)
This email I mentioned to Jess (in the previous step) is very important, as it gives them a clear guide of what they need to do. Do not wait days or a weeks to send this, because it will lose it’s effectiveness every moment you delay.
This email is what will save you time and headaches after your tenant moves out.
Here is an outline of what’s inside the email:
- Confirmation of move out date
- Balance of rent owing
- How the final outgoing inspection will be carried out
Attached to the message will be:
- Moving Out Checklist
- Repairs & Maintenance request form
- Copy of the original ingoing condition report
Here’s a snippet of my email to Ben & Jess:
I know this seems like a fair bit of effort to write but I assure you, being proactive now will show them how important it is to follow the checklist to get their bond back. I’ve written the email for you and given you the Moving Out Checklist at the end of this blog, so it will be very easy for you.
Keep an eye out for the special bonuses at the end.
I mentioned paying the balance of rent above, but the point deserves some clarification. You do not want the tenants to get it in their mind that they can use the bond to pay the rent. For one thing, it is an illegal practice. The bond money is intended for cleaning and damages to the property after they have moved out. If the tenant plans on using that money to pay the remaining rent after they’ve given notice to vacate, good luck getting them to pay for a cleaner and gardener (for example) once they are gone.
Damages and cleaning of the house are the main reasons that cause arguments at the end.
That’s why I’ve provided a checklist of things to clean before handing back the keys. I also provided an extra column so they can assign which person is responsible to clean which item. This will help them clean the house thoroughly before you even see it.
As far as damages are concerned, I’ve asked them to walk around the house noting any damages that I need to be aware of. In the process they’ll also notice little things that they’ll need to fix themselves, saving me the time and headaches.
Ben and Jess returned the Maintenance Request form to me a few days later. They noted the front door was getting stuck on the door frame, they were able to close the door and lock it but it would look bad when showing through potential tenants. So that was great to know. I got it fixed before showing any potential tenants through. That would have looked terrible if tenants saw me having to force the door open when I showed them through.
4. Advertise property
You may or may not need to advertise again but for me I needed to find new tenants.
It’s ideal to start advertising anywhere between 4 – 6 weeks out before your property will be available for new tenants to move into. The house was about 5 weeks away from needing new tenants, so I wanted to get my property in front of the world asap.
But before I started advertising I spoke to Jess about getting access to show prospective tenants. As they were moving and had family coming over they didn’t particularly want any inspections. However I was able to get her to agree to 5 open for inspection times all running for 15 minutes each spread out over the next 3 weeks (this was on the basis I didn’t do any other inspections during that time) which was annoying but at least I still got acces. I emailed Ben and Jess the agreed times so there were no mistakes.
I uploaded the new photos and increased the price on my ad from 2 years ago when I advertised last. I also added in my open for inspection times so I didn’t need to waste time telling tenants when they could inspect, they could just turn up.
I started receiving calls and emails from tenants immediately. Luckily I had already pre organised the inspection times otherwise I would have wasted time calling everything to arrange times.
5. Conduct pre-vacating inspection (optional)
About a week before your tenants are due to hand back the keys, it’s a great idea to visit the home with the tenants and discuss anything in particular that needs to be cleaned or fixed. In some cases this might be maintenance to the house which is your responsibility. Only concern yourself with the major things at this point because they have not moved out yet so the majority of work and cleaning has not started. This face to face walk through can make all the difference.
Now, I didn’t actually complete a ‘pre-vacating’ inspection in this case, as I had been in the house a few times showing potential tenants through. During those inspections I had a chat with the tenants about a couple of things I’d noticed which needed to be sorted out. For example, there were some rather large stains to the carpet in the hallway that they promised me they would get out before they left.
You should not need to make a report as you’re only looking at the major things, however if there are multiple things that need attention, a small email noting them down will do the trick.
Note: The legislation is different in each state so check up the laws in your state to see if your allowed a pre vacating inspection.
6. Tenants hand back the keys
When Ben & Jess handed back the keys first thing I did was double check the exact keys were returned, so I compared the keys they just gave me with the photo of the keys I attached to the original ingoing condition report. Secondly I asked for a copy of their carpet cleaning receipt. They didn’t have it, so I asked them to email me this before I refunded the bond.
Ben & Jess had two small dogs, which had been noted in the special conditions of the tenancy agreement. This also said the property must be professionally sprayed for fleas at the end of the tenancy. Unfortunately they had run out of time to get this done (even though it was on the vacating checklist) however they did agree to allow me to organise the spray and take the cost out of the bond. I had new tenants moving in on the Friday (4 days time) so I quickly got this organised!
If you don’t already have the forwarding address now, it’s basically your last chance to get it. You’ll typically only need it if things go pear shaped after your final inspection so it’s a good idea to get it now.
7. Outgoing inspection and create report
Straight after I received the keys, I went over to my computer and printed the ingoing condition report which I completed when Ben and Jess first moved in. I attached it to my clip-board in preparation to go out the the next day.
Ben and Jess were not able to attend the final outgoing inspection with me, which is not ideal as face to face inspections can eliminate disagreements and miscommunication on what exactly needs to be cleaned or fixed. They can see first hand what you are referring too.
Within 24 hours after my tenants returned the keys, I was at the house armed with my camera (iphone) and the original ingoing inspection.
I went room by room, starting at the entry. First, I checked if the walls were in the same condition (plus fair wear and tear) as noted in the original condition report. There were fairly heavy scuffs on the walls which I did not consider as fair wear and tear because they were so large that it was obvious the walls had not been cleaned since the tenants moved in and probably marked by large objects. The walls needed sugar soaping. I made a note on a separate piece of paper as there was no room on the original inspection report for me to do so.
Take a look..
The good news was that they had completely removed the large stains in the carpet in the hallway. Thank goodness, as I was on a fairly tight deadline with my new tenants moving in a couple days later.
It took me about 30 minutes to complete the inspection. This included jotting down what needed attention split up into ‘Owner’ (me) and Tenant (Ben & Jess) responsibilities. Ready to call Ben & Jess…
“Hey Jess, I’ve just finished the final inspection at the house. Overall you’ve done a pretty good job. Thank you. However, there are a few things that need doing. Some of which I will complete myself but there’s a few things I’ll need ask you guys to do”
I like to open the conversation like that.
It thanks them for what they have done so far and explains there are a few things they’ll need to do but also softens it by explaining that it’s not just them that needs to do some work, but also you. Keep in mind that your goal is for them to get their full bond returned, so you are working from a common ground.
From here, I explained it briefly on the phone what they need to do and arranged a hiding spot for the front door key. I also emailed this list off to them so we were 100% clear on what needed doing.
Here’s what I put in my simple email:
Hey Ben & Jess,
As Discussed today please complete the following in the next 48 hours.
Sugar soap walls in entry
Sugar soap walls in all bedrooms
Soak range hood filters (do not put in dishwasher)
Clean exhaust fan in bathroom
Return the garden hose
Weed the front and back garden beds
Trim the lawn edges with whipper snipper.
Thankfully they had cleaned everything up to my standard of ‘clean’ ready for me to complete the ingoing condition report for my new tenants.
Ben & Jess had paid all the rent well and truly before they moved out and emailed a copy of the carpet cleaning receipt to me. So the only thing to deduct from the bond was the $120 for the flea spray.
Now, I didn’t have to in this case BUT sometimes the negotiation between myself and the tenant is not as easy as this one because it was all fairly black and white. This is not always the way it goes.
A number of times in the past I’ve had tenants stick glow in the dark stars to their childs bedroom wall and ceiling. Very annoying! You can pull them off without peeling the paint however most of the time I find various spots where they did infact pull paint off. The only way to repair this is to paint the entire wall (which can seem a little silly as there might only be a few small spots).
If you paint one wall, you will want to do all the walls in the bedroom. Then if you paint the bedroom it would look out of place with the rest of the house, it can spiral out of control! So when I find myself in a situation like this, I get 2 or 3 quotes from a painter to paint the walls (this simple quote could just be done over the phone – but you might need to prove this to your tenant). Then I agree with the tenant to take this amount (as per quote) out of the bond as ‘compensation’.
Painting the walls now might not be a great option but at least you have some money to put towards a full paint job when the time arises. This technique can work in a wide variety of cases.
Back to Ben & Jess..
So I filled out the bond claim form online and printed it for Ben, Jess and myself to sign. Once done, I sent this off to the bond board. A week later I received $120 for the flea spray and they received the balance of the bond money straight into their bank account.
This all worked out fairly well. The key is to be proactive and work quick as soon as you receive the keys back.
The minute the keys are returned the tenants start thinking about their bond. You need to get out to the property to check it out ASAP. If you drag your feet at this point the tenants might be savvy enough to send off the bond claim themselves (without your signature). If they do, you’ll be forced to go to Tribunal and fight your claims to the bond. This is really not ideal because it is simply time consuming and you have to prove to Tribunal you have done EVERYTHING correct up to this point and provide quotes, invoices and other documents to prove the damage/cleaning. You shouldn’t have anything to hide but it’s just an extra thing you have to do that could have been avoided.
9. Provide testimonial for tenant and request one back.
I must admit I have never requested a testimonial from a tenant.
However, I was talking to a seasoned property owner only a few weeks ago. He told me he had great success from getting testimonials from previous tenants. Not only did this show new potential tenants that people before them loved living in the home but also they could be rest assured the owner is proactive with repairs to the property.
All in all, this will help attract fantastic tenants in the future and minimise the time your house is vacant.
Owners (and real estate agents) not completing repairs on time is the number one reason for tenant dissatisfaction.
Not only should you start doing this but agents should start doing this as well. Most agents won’t start doing this because their about 10 years behind (sorry I could not help myself).
To maximise the chances of your tenant writing you (and the property) a testimonial you should give them something in advance. Something that is easy to do is email them a full tenant ledger showing all their payments. If their rent was paid on time this will be a great testimonial to help them get future rental properties. If you want to go further you could create an ‘Excellent Tenant’ certificate to pass onto them. I don’t have one for you right now but I will create one for you if you want one. Just make a comment at the end of the blog and your wish is my command.
So that’s about it!
You can see how time is of the essence. Not only is it really important to be proactive to reduce confrontation and headaches but it also helps you to smoothly move new tenants into your house without losing a weeks worth of rent. Here is my timeline of events between Ben and Jess moving out and my new tenants moving in..
Monday (9th Feb): At 5pm the tenants returned keys
Tuesday: Completed outgoing inspection
Wednesday: Tenants went back to clean property
Thursday: Pest spray and new ingoing condition report carried out.
Friday: At 9am new tenants moved in.
There you go, my tenants moved out and new ones moved in without any headaches. It only cost me 3 days rent and a bit of forward thinking.
That’s the process I’ve learnt over the past 10 years to avoid problems and lost income when tenants move out. And I did it following this exact plan.
I want you to do the same thing, so I’m giving you several bonus resources to help.
First, I’ve got the full email copy that I wrote to my tenants when I confirmed their notice to vacate. Just replace the dates and names (in blue) for your property.
Second, I have the very important Moving Out Checklist that is the main ingredient to getting your tenants to have your property in the best shape before they hand back the keys.
Third, I’ve also got the Repairs & Maintenance request form that you’ll attach the email I’ve given you.
Save time with these bonuses
Confirm Notice to Vacate Email
Moving Out Checklist
Maintenance Request Form