High-end properties more work for property managers

Tuesday, 4 September 2018

It's a tough job managing rental properties of the kind that offended broadcaster Kate Hawkesby, one property manager says.

Hawkesby and husband Mike Hosking sold their home in Remuera last month for $9.6 million in and looked for a rental property to shift into.

Hawkesby described one place as 'filthy, covered in cobwebs, and obviously vacant for some time'. She wrote that Hosking asked the property manager if the house would be cleaned and fixed, but was told no. 

She said she was 'incredulous' given the price.

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Trade Me has 378 rental listings for more than $1000 a week, including in the Auckland CBD, Epsom and St Heliers in Auckland and Mt Victoria in Wellington.  

A property on Arney Rd, the same street on which Hawkesby and Hosking sold their place, is renting for $1150 a week.

The priciest on the site is one on the waterfront in Takapuna, on Auckland's North Shore, for $5000 a week.

Nationally, the median asking rent last month on Trade Me is $475.

David Faulkner, director of property management consultancy RealIQ, said high-end properties were a different proposition for managers.

 'It's certainly a niche market,' he said.

The basis of the job and the laws that applied were the same. But, because property managers are usually paid as a percentage of rent collected, owners of high-end homes paid much more for their services. That price would be reflected in the level of service offered, he said.

 'You've got to treat the tenant like they are going into a hotel, you've got to pamper them, look after them. They're paying top dollar.'

Chattels would be worth more and inspections would need to be more detailed. A mistake made in a top-end property could be more costly, he said.

 'If someone is paying that sort of rent you should go a little bit further.'

Kevin Edmunds, principal of property managers Quinovic in Thorndon, Wellington, said it was common for both owners and tenants to have high expectations when large amounts of money were changing hands.

'It is not unusual for us to enter into lengthy negotiations around the terms of a tenancy including the rent level,' he said.

'Some high-end tenants are really only looking for a shorter term until they can purchase another home whereas owners are generally wanting a longer-term commitment.

'Setting the house up prior to the tenancy can also be more time-consuming. For example for an average sized three-bedroom unfurnished home we often take 300 to 500 photos as part of the condition report. Layer houses two to three times that size with expensive fixtures and fittings and then in some cases they are fully furnished so more photos again and we can be taking up to 1200 photos. We generally share these with the tenant at the start of the tenancy but that creates a huge file in larger upmarket homes.'

He said tenants and landlords would sometimes disagree on what was 'clean and tidy' and the higher the rental price, the more likely an argument about this was.

The Tenancy Tribunal has considered a number of disputes about high-end rental properties in the past two years.

One Christchurch tenant who was paying $1200 a week was given compensation at the end of the tenancy for work that was not done including replacement of the rangehood, fire, parquet floor, bathroom tap and clothes dryer.

In another case, heard in July, a tenant paying $1500 a week for a Remuera property went to the tribunal to enforce his right to renew his lease on the property.

A St Heliers tenant was given compensation and a rent reduction while work was carried out on her property – among her complaints was that when she moved in the swimming pool was filthy and the spa not working.

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