Crossing the generational gap

Many senior citizens prefer to remain self-reliant, and while many own their own homes, there is still a large proportion of elderly renters living in units.

A self-confessed ‘collector’ of old folk, director of Property Ladder Realty Linda Tuck claims almost a third of her rent roll is leased to people aged over 65.

“I’d say just less than 30 per cent of our portfolio is made up of seniors,” she says. “As they get older, we find that they are downsizing constantly.”

Based in Cairns, Ms Tuck is constantly amazed at the age of the people to walk through her door – she recently signed up a 75 year-old man.

According to the 2011 Census, the area with the highest proportion of people aged above 60 was a small town called Goolwa, south of Adelaide.

Jo Holden is the director and head of property management at LJ Hooker Goolwa, a town where a third of the population are retirees.

“Goolwa is fairly interesting in the sense that it has a fair spread of people who live here, from retirees to working families … but I guess probably the higher proportion would be the retirees,” she says.

Another area with a large percentage of elderly citizens is Forster in NSW.

Cindy Loadsman, principal of Noble Realty in Forster isn’t at all surprised her patch made the list.

“There’s definitely a large proportion of elderly people here in Forster,” she says. “I believe it’s the climate; the winters aren’t too cold and there’s always a great breeze in summer.”

FINDING THE RIGHT HOME

The key to a lasting and happy tenancy is finding an appropriate place for an elderly patron.

“There’s no point putting them into a unit on the top floor if there’s no elevator,” Ms Tuck says.

Trainer, Darren Hunter, of the Leading Property Managers of Australia (LPMA) suggests taking it to the next level.

“If the place isn’t immaculate or in brand new condition, you should be careful. They’re very critical,” he says when referring to elderly tenants.

“You can have a brand new property and they will still make a list of everything that is wrong with it.”

It’s not just the physical property that you need to assess for appropriateness.

According to Mr Hunter, property managers should be extra diligent when calculating how affordable the rent is.

“They might say they can afford it, but after a month they might have trouble keeping up with payments,” he explains.

“Rent stress can happen when the rent takes up more than 25 to 30 per cent of the income. You could be signing a person into something that they’re not quite capable of handling, so it’s sometimes a good thing to have a son or daughter who can come in on their behalf.

“Having family members there with them to make sure they understand the gravity of the situation is always helpful.”

Once you get them into the right home, keeping the place in good condition is the easy part.

“There are two sides to the older demographic when it comes to maintenance,” Ms Holden says.

“You have the ones who will wait until the inspection before they mention anything. Usually it’s something like a light bulb or something that is only a minor inconvenience, but occasionally you get the very eager ones who want to fix things themselves.

“Then there’s the other side of the coin, where you have the seniors who ring up at the drop of a hat. It’s either all or nothing.”

Ms Tuck has experienced the former type first hand, with many of her elderly tenants not speaking up about repairs.

“They don’t tell you about the maintenance unless you specifically ask,” she says.

“They tend to try and live with it. The older age bracket seems to have this desire to not want to bother or disturb anyone, even when it’s our job.

“I tend to be a little more proactive during inspections, so that when you’re there you sit down and ask what needs to be fixed as well as having a good look around.”

Ms Loadsman agrees that a lot of her tenants feel like they’re bothering people when they simply need some help.

“I definitely think that they feel like they shouldn’t bother property managers, but it’s up to us to let them know that it’s okay to call us when needed,” she says.

THE PREFERRED TENTANT

When it comes to paying rent on time, our property managers agree that there isn’t a better age group.

“The rent arrears are minimal to zero, it’s quite phenomenal,” says Ms Loadsman. “The condition of the properties is kept in a much better state than with young renters.

“We look for someone in the older generation because they tend to be very long-term tenants who always pay on time and take exceptional care of their properties.”

Ms Holden agrees that she feels more comfortable renting to a member of the older age bracket than any other.

“The things that tend to differentiate them from other age groups, particularly young renters, is they’re more reliable and more pedantic about doing the right thing,” Ms Holden says.

But in a world of technology that’s growing faster every day, many senior citizens are being left behind.
Technology does seem to crop up as an issue for this demographic,” she says.

“They have trouble tuning their TV, so we may have to assist them with that. Or when it comes to internet banking, I’ve had to help some tenants down to the bank to help them set up a direct deposit payment plan.”

With most banks heading online for scheduled payments, property managers have had to either educate, or make exceptions for elderly renters.

Ms Tuck accommodates her elderly tenants by offering Centrepay, which automatically takes the rent from pension funds.

“It’s regular and they don’t need to think about it,” she says. “It’s also a way around having to set up and explain internet payment schedules.”

On the other hand, Ms Loadman warns property managers who offer Centrepay.

“We used to offer Centrepay, but we stopped it for a number of reasons,” she explains.

“Firstly, even though it is just 99 cents, that’s a cost that we can’t pass onto the landlord or the tenant, so with all our tenants paying fortnightly it adds up and it’s a considerable business cost.

“Secondly, we don’t have any control over it. We’ve had situations where young people who want to go drinking on the weekend stop their Centrepay because they can. And we don’t get the rent.”

When one of her tenants falls into arrears, Ms Holden believes that following up elderly clients should be done the same way as any other tenant.

“The thing to keep in mind is to contact them as soon as possible and find out what the circumstances and the reasoning behind it is,” she suggests.

“Sometimes it’s to do with an unexpected medical bill, and we like to think the landlord would be a little compassionate and let them get on top of it, even if that means putting in a payment plan.”

THE OLD FASHIONED WAY

Coming from an age when the hand-written letter was the norm, shifting to the property managers preferred method of communication can be daunting for some seniors.

But according to Mr Hunter, property managers must respect the client’s needs, including tenants.

“I’d say stay away from emails as a general rule. However, a lot of baby boomers are retiring now and would be fine with email,” he says.

“You treat them no differently to a landlord who only wants to be phoned. They’re still your clients, and a lot of property managers forget that.”

Ms Holden agrees that putting people out of their comfort zone is not the way to treat a tenant, especially one you hope to be in a long-term arrangement.

“Some property managers might be out of their comfort zones posting a letter, but it’s something you have to do for the client,” she insists.

Seniors love snail mail according to Ms Loadsman, with quite a proportion of her clients requesting postal communication.

“It gives them something tangible to hold, and I think that’s fine,” says Ms Loadsman. “A lady who mentors me down in Tasmania has a paperless office, and she’s told me how hard it is to get the older demographic to accept email receipts and the like.”

AVOIDING TRAGEDY

Having automated payments for bills and rent can lead to disaster.

Almost a decade ago, a 91 year-old woman was found in her Melbourne home by her property manager several months after she’d died.

The deaths of isolated senior citizens made headlines again in 2006 when an 86 year-old Sydney woman was found dead in her unit, months later.

Six other elderly Australians were found dead in similar circumstances in February that year.

As an investor herself, Ms Tuck believes these horror stories can be easily averted through simple steps.

“For my really old tenants who are getting fragile, I use a service called Red Cross Telecross,” she explains. “If I feel it’s needed, I make it a condition of tenancy that they sign up to this free program.

“The Red Cross is given the details of the tenant, their doctors and their medical history and then every morning at a set time, the Red Cross rings them to make sure everything is fine.

“If they don’t answer the phone, they will call back in 10 minutes. If the tenant still doesn’t pick up, they will contact next of kin.

“That way you don’t have these horror stories where their rent is being paid automatically, they have no family, they’re dead and no one finds out until the next inspection comes around.”

Ms Tuck had this situation happen to her, and knows how heartbreaking the process can be.

“I don’t know about anybody else, but we had to pick up the ball. We’ve had two tenants who had no family and we had to basically pack everything up, sort it all and work it all out with the public trustee,” she recalls.

But overall Ms Tuck insists that senior renters are still a preferred tenant for her.

“They're a little bit needy and wanty sometimes, but they're a good bunch,” she says.