Taranaki Property Investors' Association

Phone: 027 3738 057

Email: taranaki@nzpif.org.nz

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10-06-2016

Reducing risk as a landlord

Everything goes in writing

Absolutely everything needs to be in writing. In real estate, it's commonly said that if it's not in writing, it doesn't exist. While it can be tempting to rush a lease agreement to a new tenant, you want to carefully ensure everything is included. From who can live in the residence and what activities are permitted, to when rent must be deposited by and how non-payments are handled, only what is written is enforceable.

Get the right insurance

If you wait until an accident happens or loss has already occurred, it's too late. Get the right insurance policy in place from the start to protect yourself and your assets. Having a specialist insurance policy like Initio offers means you have the cover you need to protect your property.

Pay attention to the property

Again, waiting until something happens means it's already too late. Keeping your tenants safe requires you to keep up property maintenance and ongoing issues. If something is broken or potentially hazardous, have it inspected and take care of it. This allows you to stay on top of anything that comes up before it can develop in to more serious damage.

Don’t ignore tenants

No matter how frustrating a tenant might become you must always listen to them. If they claim something is broken or dangerous, attend to it immediately and take steps to prevent future issues. By not addressing something that a tenant points out, you are exposing yourself to consequences in the future.

Screen tenants

You can avoid many unnecessary risks by appropriately and effectively screening potential tenants. Do they have a job? Can they pass a background check? Do they have any prior history of evictions? These are all important questions to ask and research. When screening tenants, require them to provide you with prior references, ideally from former landlords because they are your best tool for gathering information.

Safeguard your business

While it's great to get everything in writing, it's only useful if you properly store and protect that information. If your documentation is in paper form, it's best to store a digital copy as well. For digital files, it's best to conduct regular backups and keep all virus software up to date. From an organisational point of view, clearly label all documents and keep files easily accessible.

Handle evictions carefully

Ending a tenancy is a serious matter and should not be started without carefully completing all of the lease and legal steps required. Always consult a lawyer before evicting a tenant and ensure you have all written documentation in place before proceeding. Never threaten a tenant with eviction as a means of getting a rent payment; the regulators and Courts don't look highly upon landlords threatening tenants.

Develop relationships with tenants

Sometimes it simply comes down to personal interaction. By developing a reputation as an approachable and honest landlord you can build trust and prevent circumstances from becoming confrontational. When there is a relationship tenants are less likely to file a formal complaint over a minor matter.

This advice is provided as common practice information, and not as legal or property management advice. If you require specific advice, please consult your lawyer or property manager.

 

Tags: landlord advice

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