ATTENTION ALL LANDLORDS
Real Estate News
Breaking News = Rental properties
By Alex Bartolo
Investors all over Australia should have good reason to be alarmed and have deep concerns over their property and their property managers and check wheather their agents are charging tenants the correct amount of monthly rent due to landlords on properties.
I believe there is a wide range of real estate agents/property managers out there which do not know how to work out the correct way of charging the weekly/monthly rent.
This is testament based on surprised new landlords when we show them how the rent is worked out by us , so far we have been told by a 100% of new landlords that other agents have not been calculating rent in this manner therefore short changing them.
The rent should be calculated in the following manner to achieve the exact and correct amount of rent to be paid to the landlord.
Firstly the weekly amount needs to be divided by 7 to achieve a daily rate for example if the rent is $300 p.w you divide this amount by 7 which equals $42.85 cents per day.
Now, times your daily rate of $42.85 cents by 365 which will give you the full year which equals $15,642.85 cents per annum, now divide this amount by 12 months which equals to $1303.57 cents p.m which is the exact and correct way of working out the monthly rent.
A lot of agents across Australia are incorrectly working out the monthly rent which short changes the landlord by one days rent per annum , the above example is the correct way where the example below is the wrong way, the difference is an out of pocket of $42.85 cents which is suffered by the landlord at the agents expense.
The way the rent is worked out by a huge number of agents which short changes landlords is as follows;
$300 PW X 52 WEEKS =$15,600 DIVIDE BY 12 = $1,300 now thats fine, if it was their money . (but its your money they are giving away)
Please note: this formula must be adjusted to account for a leap year once every four years, so on these occasions you need to divide the daily rate by 366 as opposed to a normal year of 365 days.
Is your agent really looking out for you ? Call your local Raine & Horne office today .
WE’LL LOOK AFTER YOU.
By Alex Bartolo
Raine & Horne Narre Warren South
Office 03 9704- 2533
Mob 0412 216 890