Your property manager has gone into liquidation. What happens to your rent, your bond and your tenant?

Your bond is not with the agency

Start here, because it is the reassuring part. Rental bonds in Queensland are held by the Residential Tenancies Authority, not by the agency. An agency failing does not put the bond at risk, and the RTA can confirm what is held against your property.

Rent already collected but not yet passed on is the exposure. Agencies hold that in a trust account, which is regulated and audited, but recovering money from a collapsed business is a process rather than a phone call.

The order to do things in

The instinct is to chase the money first. It is usually the wrong first move, because the tenancy keeps running whether or not anyone is managing it - and an unmanaged tenancy is where the real damage accumulates.

• →Confirm where the tenant is paying rent, and tell them in writing where to pay it now. This is the single most urgent step: rent paid into a dead account is rent you will spend months recovering.
• →Get your file. Lease, entry condition report, bond number, rent ledger, keys, compliance records. An appointed liquidator or administrator controls these, and asking early is far easier than asking late.
• →Check your bond with the RTA directly rather than taking anyone's word for it.
• →Appoint a new agency, or self-manage deliberately. A tenancy without a manager still has obligations - repairs, entry notices, safety compliance - and they fall to you the moment nobody else is doing them.
• →Then pursue the shortfall, with advice. Unremitted rent is a claim against the business, and how it is made depends on the type of appointment.

What it means for your tenant

Their tenancy is unaffected. The agreement is between the tenant and the owner - the agency was acting for you, not standing in for you - so the lease, the rent and the term all continue. What changes is who they deal with.

Tenants in this situation are usually anxious and hearing nothing. A short, clear message about where to pay and who to contact does more for the relationship than anything else you will do that month, and it protects you: a tenant who cannot get an answer stops paying, and then you have two problems.

How to avoid picking the next one

There is no test that catches every failure, but there are signals worth checking before you sign with any agency: whether the trust account is audited and by whom, how long the business has traded under its current structure, whether the person managing your property is an employee or a subcontractor, and whether the fee is so far below the market that the maths cannot work.

Cheap management is not free management. Somebody is paying for the gap, and it is usually the owner who finds out last.

Where LINK Living sits

We take on mid-tenancy transfers regularly, including from agencies that have collapsed, and the handover is the part we are good at: locating the file, re-establishing rent, writing to the tenant and getting the property back onto a normal footing.

The insolvency side is not a property management question, and we do not pretend otherwise - LINK Rescue handles that end of it, and sits in the same building.