10 April 2016

Minimising your risk – its all about being compliant

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Upon entering into a new lease agreement, your property manager will need to ensure that your lease complies with current legislation that affects all rental properties.

Today there are a growing number of compliance issues that need to be addressed before entering into a lease agreement, some of which have not affected lease agreements before.

Every property investor needs to make sure that their property is smoke alarm and water usage compliant, together with window safety device, blind cord and pool compliance before the property is leased.

Obviously there is a cost to the property investor to ensure compliance, however the risk of non compliance far out ways the cost of compliance.

A large number of property investors are ignoring the need to have their property lease compliant simply because that they haven’t needed to do it before or, they cannot see the benefit of the cost.

By ensuring that your property is lease compliant, not only with Residential Tenancy legislation, but by compliance legislation as detailed above, the property investor not only runs the risk of having an invalid tenancy agreement, but also could face heavy penalties or having any insurance claim denied in the event of a loss in the above events.

Worse still the property investor could be liable at law in the event of public liability claim as a result of a non compliance loss. As an industry we have already seen this occur following house fires in rental properties where the property investor becomes personally liable should the property not be smoke alarm compliant.

Your property manager is faced with the unenviable task of informing you of these additional lease compliance costs; however the advice must be heeded to ensure that your property is compliant and so you minimise your risk of legal action and additional costs.

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