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The sliding scale of rental property inspections…

1st March 2014
Discover how to carry out rental property inspections on a sliding scale, so that your property management suits all tenant types.

Discover how to carry out rental property inspections on a sliding scale, so that your property management suits all tenant types.

Here in New Zealand, the industry standard for rental property inspections varies between 3, 4 or 6 months… yet under the Residential Tenancies Act 1986 it allows for rental property inspections once every 4 weeks.

More frequent rental property inspections = better property management outcomes

The more often rental property inspections are carried out, the greater the likelihood of the tenancy being successful. This is for a number of reasons:

  • The tenant knows that you’re keeping a watchful eye on the property, and will be less inclined to cause damage, or bend any of the other rules in the Tenancy Agreement.
  • Regularly seeing your tenant face to face means that you get to build up a good working relationship.
  • If you do spot any damage or other problems, you can nip them in the bud early before they escalate.

Does that mean you should carry out rental property inspections every 4 weeks?

No, it wouldn’t be efficient to carry out full property inspections on all properties every 4 weeks.

Rather, rental property inspections should be carried out on a sliding scale: these is no logic in applying the same inspection regime to an A1 tenant as to a D-grade tenant… yet that’s exactly what many landlords do.

Property inspections for A1 tenants:

A1 tenants – and only A1 tenants – should have the privilege of property inspections every 3 to 6 months. Even with this inspection regime, it’s recommended that informal exterior and interior checks take place.

Property inspections for sub-standard tenants:

If you have made a mistake with the appointment of an unsuitable tenant, then it would be wise to carry out monthly inspections. While a property is not in a clean and tidy state, or suffering damage, a landlord cannot afford to turn up at the property every 3 to 4 months.

When (and only when) the tenancy improves, the inspection rate can be dropped back to say 2-monthly.

The landlord should also take every advantage to check the property’s exterior without giving notice. And be sure to use contractor visits as an additional opportunity to view the inside.

Remember: property management is about PROPERTY MANAGEMENT!

There are no shortcuts to inspections. If you have a problematic tenant and maintain your normal inspection frequency (e.g. 3 monthly), then you are in effect giving the tenant a 3-month holiday where anything goes (and probably will) until the next inspection.

A more appropriate inspection regime, especially for landlords who have suffered sub-standard tenancies, would be to have a first-year inspection regime as follows:

  • First 3 inspections: 1 month apart
  • Next 3 inspections: 2 months apart
  • If things are going well after the first year: consider inspecting every 3 or 4 months.

What if you discover a problem at rental property inspections?

Face-to-face meetings with your tenant have by far the greatest impact for resolving tenancy problems.

Letters, text messages and 14-day notices have little effect in comparison – they are simply recording instruments.

Tenant quality varies from excellent to extremely bad; there is no point in maintaining the same inspection regime you would use for an excellent tenant when you have an extremely bad tenant.

An inspection regime was never meant to be set in stone (i.e. once every 3 months). Rather, it needs to be responsive to the severity of the problem. Without being responsive you are neither protecting the asset nor managing it.

Summary

  • You are legally entitled to carry out rental property inspections every 4 weeks, if needed.
  • Do not allocate the same resources to rental property inspections for A1 tenants as to below-standard tenants.
  • If you have problem tenants, initiate monthly inspections. Reduce the frequency only once the tenancy improves.
  • Use face-to-face communication to solve problems with your tenants.
  • Take every opportunity to visit the exterior of the property, to look for signs of problems. You can do this legally without giving notice.
  • Accompany tradesmen when they make repairs: this gives you another opportunity to see inside the property (legally), without doing a full inspection.

 


 

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