May 22, 2017 12:29:38 PM

Maintaining your rental property makes good financial sense

Topics: Finance, NZ Finance, Financial Health 0

Every five years since 1994, research group BRANZ has undertaken a “House Condition Survey” that includes an onsite assessment of the overall condition of around 550 owner-occupied and rental homes around New Zealand. Not surprisingly, the results revealed that the condition of owner occupied homes is still well above that of rental properties. Read on to find out what your obligations as a landlord are when it comes to maintaining a rental property.

Property inspection and regular checks

Before renting out your property, you should undertake a property inspection to ensure everything is working well, and that your property is clean and tidy and ready for your tenant to move in. Look for signs of pest infestations and note any existing damage in a property inspection report.

As a landlord, you need to ensure your rental property is secure – all locks and security systems work – and that the plumbing and electrical wiring is safe for use. Regular checks on your property will help you uncover any damage or general wear and tear that will need to be repaired.

Who pays for damage

It’s a good idea to carry out any repairs promptly, rather than waiting for a whole list of issues that need to be fixed. Your tenant is responsible for letting you know when something needs fixing, and you as the landlord are responsible for any repairs or damage that could arise from burglaries, natural events (storms, floods, earthquakes), as well as fair wear and tear.

If your tenant intentionally causes damage to your rental property, you’re entitled to ask them to repair the damage or cover the cost of replacement or repair. It’s vital you insure your rental property as tenants are not liable for damage caused by fire, flood, explosion, lightning, storm, earthquake or volcanic activity, unless caused deliberately.

To find out more about tenant’s liability for damages and landlords’ insurance, visit the Tenancy Tribunal website.

Responsibilities as a landlord

When it comes to gardens and maintaining the outside areas of your rental property, you as the landlord are generally responsible for cutting back trees and hedges, while your tenant should take care of the general upkeep like mowing and weeding.

From 1 July 2019, ceiling and underfloor insulation will be compulsory in all rental homes. Insulation statements are already a compulsory part of all tenancy agreements signed since 1 July 2016. As a landlord, you must declare where there is insulation in your rental property, what type it is, and what condition it is in.

Likewise, since 1 July 2016, all rental homes should have working smoke alarms installed, and you as the landlord are responsible for ensuring these are correctly fitted and are in sound working order.

A sound investment

In today’s heated property market, there’s little doubt that investing in property makes good financial sense. But, so does maintaining that investment. As a landlord, keeping your investment property up to standard means you’re more likely to attract the right tenants, you save money by fixing problems before they get too big, and you’re assured your investment will continue to grow with ongoing repairs and maintenance.

If you need advice around a finance solution to undertake repairs to your rental property, talk to a Mortgage Express adviser.

References: Branz 2015 House Condition Survey

http://www.branz.co.nz/cms_show_download.php?id=a1efff0a2fd9885ecf878ce475631df7025cf3b8

Ministry of Business, Innovation and Employment NZ

https://www.tenancy.govt.nz/maintenance-and-inspections/regular-maintenance/

Tenancy Tribunal

https://www.tenancy.govt.nz/assets/Uploads/Tenancy/Tenancy-Tribunal-Practice-Note-20161-Tenant-Liability-for-Damages.pdf


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