While you may save on agent's commission, the disadvantages of not hiring one means you will have to invest your time to do all the administration and paper work including monitoring your ads and updating them. Unless you can do this full time, the process may take longer than you want and you might not be able to achieve a high rental price due to low number of views, hence less interest in your property.
Selecting estate agents
Using several agents would allow the property to be advertised more greatly. Also, it will not be more expensive to use more agents as only the agent that completes the deal will earn the commission. However, if too many agents are used, it may serve as a disincentive for the agents to try to rent your property out due to the competition from other agents.
To get the most suitable tenants, one should select the agents who specialize in the area or type of property.
When providing property details to the agent emphasize on the property's good points, for example, nearby schools, shopping centers, transportation. Taking photos of the property would be useful in attracting prospective tenants or in advertisements.
Renting costs
A month's rent will be paid to the agent when the property is rented. There will be a stamp duty fee of RM 2.4k, which will be paid by the tenant.
Deciding the asking rent
Estate agents will give you a rough estimate on the rental you can charge. However, aware that some agents may quote a high expected rent so that you will market the property through them, but overpricing may result in lack of interest from prospective tenants. Hence, it is important to check with a few agents before deciding on the asking rent or to view similar properties in the area.
Properties with higher selling power:
- Properties which have nice furniture or interior design
- Areas favoured by expatriates
- Close to amenities and facilities such as train stations, schools
Generally, the asking rent will be pushed down and would vary according to your needs. If you need to sell it in a short amount of time, it would be much easier for you and your agent to decide on a lower asking price.
Viewing
One has the choice to be there during viewings or let the agent show the property. No matter what, it is important to make viewing the place convenient as the potential tenant's schedule will be packed and would not hesitate to not view your property if it is too troublesome.
Advantages of being there:
- Can address any queries potential buyers have
- Can gain feedback on how to improve the showing
Disadvantages of being there:
- Pressure buyers when they view the property
- May discourage buyers
After renting out, check the rental agreement to ensure you have the rights to bring prospective tenants into the property or seek permission from your tenant to arrange for viewings at convenient times.
Presenting the property is important as it can greatly enhance the value of the rental
- Switch on aircons or fans to make it comfortable for the potential tenant
- Switch on all lights to ensure that rooms are bright
- Repair noticeable faults - door creaking, leaks etc.
- Decorate the place well with paintings, plants etc.
- Make sure that the property is clean and smells good
- If there is a garden, make sure that it is tidy too.
Negotiations
- Find out from the agent what precisely the buyer expects to be included in the price he is offering in order to avoid any misunderstandings (eg, furniture, curtains, fridge).
- Find out the prospective tenant's employment credentials to determine the risks of the tenant defaulting on the rent.
Landlord's viewpoint
Decision will be based on current circumstances, such as whether there are other tenants interested in the property and whether it would be possible to receive a higher offer. Also, landlords should consider if they are in a hurry to rent out the property?
Tenant's viewpoint
Potential tenants usually offer prices lower than what they are prepared to pay for. Talking to the agent to understand the tenant's circumstances would be useful.
Agent's viewpoint
The commission is a month's rental, thus the higher the better. However he might only want to earn his commission.
Rental agreement
Once the rent is agreed, the tenant will be expected to pay the first month's rent to seal the deal. When signing the agreement, the tenant will also pay you three and a half months' rent for utilities and security deposit.
The rental agreement:
- Landlord and tenant particulars
- Address of property
- Rent
- Term and commencement date
- Tenant and landlord covenants
One important clause to include in the agreement is whether the tenant can lengthen the rent at the end of his term there. Expatriates might include a clause if transferred to another country so as to end the rental early.
List clearly the furniture and also the appliances together with the property to avoid any disputes at the end of the term.
End of the tenancy
If the tenant is not renewing, do advertise again as every month not rented out is a month's rent loss. At the end of the term, make sure that every appliance and furniture provided is in the condition they were in. If not, you may keep all or some of the deposit paid.
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