Is Delaying Repairs a Good Investment Strategy?
30 April 2015
Some landlords wanting to keep their income as high as possible think it best to economise on repairs they feel might not be necessary.
Landlords as well as tenants are subject to residential tenancy legislation. For example, landlords have to keep the property in good condition, they are obligated to lodge the bond with the Rental Bond Board, and there is a limit to the amount of bond that can be charged.
Most tenancy agreements state that the owner of the rental property is obliged to conduct ‘urgent repairs’ as they arise. Urgent problems are usually defined as those that radically reduce the tenant’s ability to live in a property, such as a dangerous electrical fault, or serious infestation leading to large-scale structural damage.
A rental property owner who does not see to urgent repairs is asking to pay more for repairs in the long run as tenants have the right to hire qualified trades people to carry out urgent work and send the bill to the owner of the property. It is unlikely that a tenant will shop around for the best price, since ultimately the cost is legally payable by the owner.
Another result of the false economy of delaying repairs is that if a property becomes rundown, there is more likely to be vacancy and loss of income as tenants become disillusioned with the standard of their accommodation. Furthermore, many maintenance issues get worse if not attended to and costs more if the job becomes more difficult.
If you are not sure whether a repair or improvement is necessary or advisable, ask your property manager for a recommendation. A third party is often more objective and can see the long term advantages of keeping the standard maintained while at the same time trying not to incur unnecessary expense.
Always remember to check with an experienced local property manager to make sure you are complying with all governing legislation and regulations.