Many farmers choose to use additional dwellings on their farms either as accommodation for workers or as an investment property. This can add value to the farm, attract the best workers and supplement the farm’s income, but it can also bring unwanted stress. So what is there to consider when renting out your farm housing?

At first glance, managing a farm property yourself can seem like the obvious choice because the income from it goes straight into your pocket. And while that is a benefit, being ultimately responsible for the house can have its drawbacks. You’ll need to think about the hassles that come with managing a property, and how exactly that will affect your everyday life. 

In this article, we’ll tell you all there is to think about when using a property for workers or renting a farmhouse out and why a rural property manager can end up being well worth the extra cost.   

Regular property inspections

Managing a property requires you to make regular inspections of the property, and keep all the relevant records documenting these visits. Since rental law is constantly evolving, it can be a challenge to keep on top of your obligations as a landlord and being unprepared could land you in hot water. 

Even if your farmhouse is supplied to farm workers as part of their contract, you still qualify as the landlord and are bound by the same tenancy laws as a normal residential property. So whether your tenants are farm workers or otherwise, you need to ensure your farmhouse is maintained and measures up to the legal rental standards. 

McDonald Property Management has a rental checklist you can use during inspections to help you notice any repairs that need tending to. However, since the legal requirements are constantly changing, you’ll need to keep your checklists updated, and regularly check the property is compliant. For busy farmers, the time and energy needed for this constant monitoring are often too much, especially when a qualified property manager could easily take the reins. You’ll also need to make sure the inspections meet the regularity required by law and that you give the correct and proper notice to the people occupying the building.

Healthy Homes obligations

The Healthy Homes standards have triggered a range of obligations for New Zealand landlords, and for some this has led to fear that these changes will lead to unexpected expenses. And for many farmers with older properties, they might.

The Healthy Homes guidelines include upgrades to:

• Heating
• Ventilation
• Insulation
• Drainage
• Draughts and moisture
  
  

Many landlords have had to make costly upgrades to avoid the $7,200 fine for failing to comply with the new standards on top of the cost of materials and labour to meet the standards. But keeping up with these regulations, and knowing the most cost-effective solutions can be daunting for a busy farmer, which is why hiring a farm property manager could be an economical choice. 

Professional rural property managers are constantly researching the changing rental laws, and they stay current with the best management techniques. That means you’ll be in safe hands, and know your rental property won’t require any unexpected repairs. From the get-go, your rural property manager will know the changes you need to make, and how you can make them economically.

The Tenancy Tribunal and expensive penalties

When renting a property out, you’ll want to make sure you eliminate the risk of ending up at the tenancy tribunal, especially if it could end in a fine. Depending on the tenancy issue, a tribunal hearing can result in a few outcomes, including expensive payouts. 

If you are not keeping on top of your responsibilities as a landlord, you might receive an order to do one of the following: 

• Refund overpaid rent.
• Pay a penalty for legal breaches, such as not lodging the bond on time. 
• Pay compensation for damages resulting from neglect.
• Complete relevant maintenance. 
  
  

Property managers are skilled and knowledgeable when it comes to the tenancy tribunal, meaning they can take the necessary steps to avoid it altogether. Meeting your landlord obligations can be complicated, but a property manager will have all the expertise to keep you from being caught out. They’ll ensure all the steps are taken to resolve the issues, including looking into self-resolution so that a hearing isn’t required. 

However, if a tribunal hearing can’t be avoided, a property manager can support and represent you through the process. As part of their role, property managers understand the tenancy law thoroughly, as well as knowing to keep comprehensive records that will be crucial during the hearing. 

To keep your tenants happy, you’ll need to recognise their rights and provide a comfortable, safe environment for them to live in, especially if you’re also their employer. That way, you can keep their satisfaction high, and your stress levels down.

Managing stress

Managing a farm is stressful enough without adding the additional laws a rental property brings into the mix, so hiring a farm property manager is a worthwhile investment. By focusing your energy on the farm itself, you can keep on top of any issues and know your rental property is being taken care of, while still bringing in a secondary income or providing a home for key workers. 

Managing a property requires constant attention, including phone calls in emergencies and for maintenance issues. By sacrificing time spent on the running of your farm to manage these problems, you might become prone to burnout. Either way, your rental property or farm will bear the cost, if not both. 

Managing a property involves: 

• Being available for communication with tenants.
• Staying up to date with tenancy law and Healthy Homes standards.
• Keeping meticulous records.
• Preparing for a tenancy tribunal hearing, as required.
• Understanding the region’s rental market values.
• Arranging appropriate tradesmen for maintenance.
• Supplying documentation for accountants
  
  

We realise that a property manager’s role usually includes finding new tenants, which isn’t something many farmhouses need and with the rent often being part of a farmworker’s contract, you may not need us to keep an eye or collect rent either. That’s why our farm property management services can be tailored to the management of properties with staff occupying the accommodation. The inspections factor in the often remote locations of these properties and our support factors in the even more specialised legal requirements of farm staff housing.

You can request a free rental assessment with McDonald Property Management without getting locked into any contracts. We’re the most convenient property management provider in Taranaki with eight offices around the mountain, and all the local expertise you need. Our seasoned property managers will take the pressure off your shoulders and share industry know-how to make the whole process as smooth as it can be.