A verbal agreement is never enough in property management

A verbal agreement is never enough in property management


A verbal agreement might be fine with family and friends, but in property management it’s never sufficient, even if you have a good long standing relationship with a landlord. Without clear communication and proper documentation, you could be left footing the bill.

Let’s say you have a landlord who owns more than one investment property, all managed by your agency. They would no doubt be considered a valuable client to your agency and you certainly wouldn’t want to risk losing them.  This is precisely the type of client with whom things could become a bit lax.

Imagine if a new tenant has just been approved for one of this landlord’s properties and the two of you agree that the gardens need some TLC before the new tenant moves in. The landlord doesn’t have time to do the work and verbally agrees to having a gardener brought in to do the job. Money is not discussed.

The work to be done proves to be quite labour-intensive and after a day and half’s work, the gardener presents an invoice for $500. You can see how much work they have done – the garden looks great – and you have no qualms in presenting the invoice to the landlord.

On forwarding the fully itemised invoice to the landlord for payment, he complains that it is too expensive and that he had only budgeted for half that figure.

The solution

Not paying the gardener for the work performed is clearly not an option. If your negotiations to pay the full amount fail with the landlord, and escalation to your manager also fails, then unless the gardener wants to take the landlord to fair trading, your agency will have no option but to pay the balance.

The lesson

The lesson here is to ALWAYS obtain a written quote from any tradesperson and don’t give the go ahead for the work to be done unless you receive written consent from the landlord to proceed. This is true no matter how good your relationship with a landlord is and how easy they have been to work with in the past.

Using a maintenance software application like Maintenance Manager would have facilitated open and clear communication between all parties via the trade database component of the system. The system provides Instant notifications and messaging between the property manager, tenant, landlord and trade professionals, including a simple transparent quotation and acceptance system. No more confusion, miscommunication or assumptions. That’s just one of the reasons Maintenance Manager is the trusted risk mitigation and property maintenance solution for property managers all over Australia. Contact us for an obligation free demonstration today.

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