LANDLORD GUIDE (Checklist during & end of tenancy)

Do you own any property? Have you rented your property? How did you do it? 


I am no expert but having been in the real estate industry as a Senior Real Estate negotiator for 4+ years now, I do have some tips to share on real estate. There will be a series on Landlord guide, Tenant guide, or relevant information on real estate in Malaysia. Follow me on my blog if you want to know more. Feel free to leave your comments if you need me to respond to your queries. I'll try my level best to answer your queries.


(Note : All contents shared are my personal observations & experiences,  without prejudice to my rights).

Check list during & post tenancy:

• When tenants move in:
• Go through the inventory list thoroughly and make sure tenant acknowledges on the copy. Ideally, have two copies, one each for landlord and tenant.
• Do a meter reading for water & electricity, record it and have tenant acknowledged it.
• Normally, two access cards (condo) are given. {depending on condo, if extra is needed, tenant to use tenancy agreement to apply for the extra card & to pay for the card. Most times, the money is refundable}. Two sets of main entrance keys, 1 set of room & mailbox keys. Do indicate in the inventory list all the above items as well to indicate parking bay lot number for easy reference. 
• Advice tenant the condo's management contact number (if condo/apartment), guardhouse number as well as local emergency /amenities contact numbers (if expat).
• Show the tenant all facilities available. Eg the Gym, swimming pool, etc 

• Periodically check on the following : 
• Rental ~ timely payment made. If you allow precedent for delay, it will happen again & again. Rental payments in standard tenancy agreement is on/before the 7th day from effective date. To ensure no delay, it is advisable to include landlord's banking details in tenancy agreement to avoid tenant saying not aware, no/lost information, etc. Both tenant & landlord should have a copy each of the agreement, stamping fee borne by tenant.
• Utilities paid up-to-date, check on all utility bills. Do ensure previous tenant has paid all bills and new tenant start afresh. Hence, advisable to do meter reading on the day new tenant moves in. I had an incident whereby landlord did not do this. Tenant moved out & left a whooping RM3,000 unpaid electricity bill. Bill was not paid since they moved in!! Subsequently, tenant could not be traced as they have changed their mobile number and no cross reference to trace tenant.
• Drop by unit to check cleanliness and furnishings are well maintained. A standard 7 day notification is expected, either in writing or verbal as pre-agreed between tenant & landlord.
• Drop by to ensure unit is also not sub-let. Quite common amongst students. (cost sharing reduces their expenses)
• Do act promptly should any electrical equipment/item is faulty or needs to be changed. This is to avoid any chance for tenant to delay rental payment.
• If you know your neighbours, do a cross check on your tenant to ensure that no illegal activities are carried out at your premises.
• You MUST ensure that your expat tenant has a valid passport or you may be considered as hoarding an illegal immigrant! Ewwww....

• If you intend to sell the unit while tenancy is still in place :
• Make your intent clear to your tenant from the start if you have decided to sell your unit. Best to inform them in writing in case they turn around and say that they weren't aware of your intent.
• If you do engage an agent, do ensure that your tenant is aware of your appointed agent. The agent to make viewing appointments at the convenience of your tenant so as not to inconvenient your tenant. 
• Do inform your potential buyer the duration of the tenancy as some buyers may buy for their own stay and may want to move in immediately once bank has released the loan. Once that is established, make sure it is included in the terms and conditions in the Sales & Purchase Agreement (SPA) to avoid disputes later on.
• Ensure that you include the clause in the tenancy agreement & the SPA that the unit is sold together with the tenancy agreement, or else your tenant will be left without a roof over their head & may in turn sue you for it. Also, very important if buyer is an investor. They particularly would want the tenancy agreement to be inclusive so as not to loose out on immediate revenue.
• Do make it a habit in getting tenancy agreements done. Without one, you may end up having to pay more when you have to evict your tenant if they refuse to move out especially when it is verbal agreement and no contract has been established nor any evidence as proof. Many investors would also shy away if there isn't any contract for fear of extra cost to evict the tenant which is often a long battle and to do it legally would also be costly.

• If you are renting it fully furnished or partially furnished, do be aware that:
• All rentals are considered as revenue/income in Malaysia, hence it is taxable.
• If you rent it partial/fully furnish, the entire rental sum is taxable. However, to avoid higher taxation, you can choose to separate rental & furnishing ( the latter as expenditure/cost). To know more how taxation works, I suggest you speak to your accountant.

• Termination of tenancy agreement :
• The agency I represent has a standard tenancy agreement that states that there should be no termination within the first 12 months & two months written notifications thereafter from either party. For the first 12 months, should either party terminated before the 1 year period, the affected party will be paid the difference in sum equal to the number of months balance in the agreement. Example, if a tenant who stayed for 9 months but chose to end the agreement will have to pay the landlord the balance 3 months 'lost' rental. Likewise, vice versa.

• End of tenancy agreement :
• DO NOT allow your tenant to utilize the security deposit to offset balance two months of rental. Why? Because it is called a security deposit for a reason, DUH!! The deposit acts as a security for the landlord in the event there is any damages that occurred during the duration of the tenancy. The amount will be used to pay for such damages. 
• Do ensure that the clause is added in the tenancy agreement to act as a safety net in the event the unexpected do happen. At most times, a two week period is given for you to return the deposit once everything is considered to be in acceptable condition. Similarly the utility deposit.

• Ensure all electrical appliances/items are in working condition before tenants move out :
• Do ensure that all broken/ spoilt items are replaced. Use the inventory list as cross reference. Use the security & utility deposits to pay for any broken/spoilt or damage items. 

• MUST ensure there is a tenancy agreement :
• This is to avoid any misrepresentation or disputes later on. Also, get it stamped to legalise the document. In the event of dispute and if it is taken to court, the agreement is legal. Or else, it cannot be submitted to court as evidence.

• All utility bills to be paid-to-date :
• Prior to refunding tenant the utility deposit, do ensure that all bills are paid to-date to avoid any disputes later on. Do ask for original bill & payment receipts as proof.
• Once you have refunded the tenant the utility & security deposit, ensure that they acknowledge receipt, lest they request for it again.

Well, hope both the articles are of help and you like the sharing. Please feel free to share amongst your friends for caring IS sharing. Until the next article....

Stay positive, Stay HAPPY and confident always!

Happy LANDLORDING!!!