Rental nightmares as tenants, landlords deal with changing real estate landscape

It wasn’t until Erin Farrar had signed the 12-month rental lease for a house in Epping and moved in that she first noticed raw sewage gushing from a pipe in the yard, quite independent of any drainage system.

Then she saw the 240-volt wires stapled to the walls inside the house, above the sink. And then the rickety back staircase that looked like it might collapse or splinter at any moment. And then the toilet that didn’t flush…

A relaxing bath to soothe her taut nerves wasn’t an option, either. The taps over the tub had never actually been connected to water pipes.

“I got in touch with the real estate agent, but they absolutely refused to do anything,” says Ms Farrar, 31, a student. “The landlord also came around almost every day as he has a business in another part of the house, but he wasn’t interested, either.”

After three months of hell, Ms Farrar has finally negotiated her exit so she won’t have to pay extra, on top of the $500-a-week rent, for breaking the lease. “I think I’m still in a state of disbelief about how bad things can get, and I look at it every day,” she says. “It’s been an absolute nightmare.”

Bad landlords can certainly make tenants’ lives miserable but bad renters can also inflict more than their own fair share of suffering on owners.

One landlord in an outer Sydney suburb, Katherine, who doesn’t want her surname used, was shocked when police raided her property and arrested the tenants. The next day, she was horrified to be told they’d been using the house as a drugs lab.

“I went over there but wasn’t even allowed in,” she says. “The roof cavity was apparently full of chemicals. The police wouldn’t even tell me what they were as it was part of an ongoing investigation. It was terrible.

“I was looking at a significant bill for chemical analysis before even starting to think  about getting rid of it, and cleaning the whole place out. It cost a small fortune.”

Today, with many more people renting than ever before, for longer periods and, with property so unaffordable, often expecting to continue to do so for their lifetime, there has never been so much attention focused on the sector.

There have been review websites set up to help suffering tenants, and warn about bad landlords, advice published by property managers to help investors renting out their properties, the tenants unions and NCAT at full stretch trying to settle disputes, and a Parliamentary inquiry, begun last year, into tenancy laws.

Anthony Ziebell, for instance, has set up two businesses, the review website Don’t Rent Me where tenants warn others about bad landlords, and Tenant Shield, a service that aims to assist tenants when dealing with issues and disputes with landlords and agents.

“It’s all about giving tenants a voice and giving them the opportunity to share their experiences with each other,” he says. “There’s just no real support for tenants. Tenants’ unions are really stretched with a lack of resources and, although tenants pay millions of dollars in bonds, barely any of that goes back into helping them.”

Another major problem is in the legislation itself, believes NSW Greens MP Jenny Leong, who set up a Facebook page to collect rental horror stories to provide real-life cases for her submission to the review of the NSW Residential Tenancies Act.

Government policy simply hasn’t kept up with the reality these days of having so many young people, families and older people renting long-term, rather than a few doing it short-term before they buy their own place. In her electorate of Newtown, for example, 50 per cent of the population are renters.

“We’re calling on the NSW Premier Gladys Berejiklian to lose the ‘no grounds eviction’ clause from the Act,” says Ms Leong. “We’re one of the few OECD countries that still allows this disproportionate power of the landlord over a tenant, where they can evict a tenant without having to have a good reason.

“In practice, this clause is often used by dodgy landlords to get out of doing any maintenance. Tenants who ask for problems in their homes to be fixed are often simply given notice, so the property can be put back on the market for someone else, without the landlord having to pay to have the issues resolved.

“The impact on tenants of living with this kind of insecurity can be huge. Your home is meant to be your safe place; not knowing if you’re going to be evicted at any stage can have a terrible emotional impact and cause enormous stress.”

When today we have so many “mum and dad investors” as landlords for the first time, that can present even more problems, says Ned Cutcher, senior policy adviser for the Tenants Union of NSW. “They’re relying on tax breaks to help them get ahead and they aren’t really interested or encouraged by policy-makers to learn what it means to be good landlords,” he says.

“With house prices so extraordinarily high, they may have already paid at the higher end of what they can afford, so if something needs fixing, that can be a blow they haven’t accounted for.”

In the middle of it all, real estate property managers can often help, but sometimes badly hinder, outcomes.

Community worker Joel Pringle, for instance, took on the rolling lease of an apartment in Redfern from friends, and when the landlord said, two years later, that he wanted a rent increase, said he’d be happy to pay – as soon as all the repairs had been done. The property manager agreed to hold the rise until everything had been fixed.

But then, nine months later, Mr Pringle, 35, and his partner, chiropractor Elena Rosseel, 28, were startled to receive a letter threatening eviction for unpaid rent. “I didn’t understand at all,” he says. “All the rent had been paid. We were completely up to date.”

He phoned the agency to protest, only to discover the agent had left the company, without leaving any records of their agreement. The “outstanding” rent had been tallied up as the extra money that would have been paid had the increase gone through.

“I suggested we go for a mediation to discuss and settle the matter,” Mr Pringle says. “And then, immediately, I received an eviction notice in the letterbox. I waited for a hearing at NCAT but the new agent refused to release my bond, so we ended up negotiating a settlement, and we left.”

Relations between tenants and landlords can be difficult, and there can be faults on both sides, says another, completely unrelated agent, Rachel Garnsey, the business development manager at Wahroonga’s McConnell Bourn.

Over the years she’s come across over-demanding tenants who complain about mould in bathrooms when they haven’t even tried cleaning them, failing to do even the most basic tasks to keep pools in good working order, and even demanding the agent or landlord come over to clean up the mess when a bush rabbit happens to poo on the front lawn. There are also unrealistic landlords, she says.

“Every day I work with landlords and potential landlords, and my advice to them is, ‘Treat the property like a small business, not like an ATM machine’,” she says. “In other words, be prepared for ongoing maintenance and upkeep for the property. By far and away, our landlords who have this mindset have the most successful relationships with their tenants.

“When a tenant comes across a landlord who is prepared to maintain the property and engage in preventative maintenance, he’ll not only stay longer at the property, thereby reducing reletting costs, accept larger rent increases and keep the property in a pleasing manner – all making for a more profitable return for the landlord.”