Becoming The Landlord, What You Should Keep In Mind

Thursday, December 3, 2015 / Property Investment, Property Management

 Stepping into the realm of property investment goes hand in hand with becoming a landlord.

The idea of being a landlord can be a thrilling, yet questioning experience for many people.

Your initial experience with the rental process probably came from the other side of the spectrum; in that you may have been a tenant.

Being the landlord however is a much more involved process, as you manage the leasing, the bond, and various other landlord’s responsibilities.

 Managing The Rental Property

It comes as no surprise that the vast majority of property investors decide to hire a property manager.

Whilst it may be tempting to think that you can save some money each year and simply manage the property yourself, you may find this to be a             regrettable mistake in years to come.

In the same way that when you have a legal matter that requires attention, you would bring in a lawyer, when there is a lease and other residential tenancy matters to be covered you are always going to be safer with a professional.  Not to mention you will have more time on your hands.

When it comes time to:

• advertising a property,
• vetting applicants,
• following up references,
• making a decision,
• arranging the lease,
• collecting and monitoring rent
• scheduling inspections,
• attending to any maintenance,
• staying up to date with all costs,
• Tending to any tribunal or other legal requirements;

you will quickly see the value of having the professionals in your corner.

A well planned investment strategy will make allowances to ensure that a highly skilled and knowledgeable property manager can be a part of the investment team.

Maintaining The Appropriate Insurances

Insurance can be one of those glum topics that no one likes to consider.

The very need for it implies that we have less control of our future than we would like, and that at any moment all manner of calamities may hit.

Nevertheless it is one of those necessary parts of life that all responsible individuals accept.

Please note that when selecting insurance you must read very carefully about what is covered in all of the available policies, in no way are we making any specific recommendations on which insurance products you should purchase. We recommend speaking to a licensed and experienced insurance broker.

Building Insurance

It would be absolute madness to gain such a valuable asset as a piece of property and then not be covered with a suitable level of insurance.

No one expects or wants their house, or their investment property to burn down, but if it does happen they do not want to have to start from scratch again.

Note, that often our building insurance may be covered in any strata fees that may be applicable to your investment property, your property manager will be able to advise you of all the primary details.

Landlord’s Insurance

Landlord’s insurance is specifically tailored to assist a landlord with covering the potential downfalls that they may face during the process of renting out their investment property.

Typically Landlord’s insurance can cover the following:

• Theft or burglary caused by the tenants or any guests that they bring to the property
• Any purposeful acts of violence or vandalism caused by the tenants or their guests
• Any loss of rent caused by the tenant defaulting
• Legal costs related to tenant eviction in court or tribunal
• Rental losses due to unexpected death of a tenant
• Rental losses due to a tenant not giving vacant possession in time
• Rental loss due to damage caused by the tenant
• Damages caused by the tenants pet(s)
• Liability coverage
• Re-letting expenses after a claim of rental loss
• Change of locks after an eviction

There are some great policies out there that cover the above clauses and some that cover even more.

Take your time to read the various product disclosure statements and find the cover that suits you best