How do I submit an offer on a house?
When buying a home it is important to remain rational and to do your homework. A house is worth the maximum......
In 2016, an odd ruling came through the Court of Appeal (CoA) in New Zealand. The court found that two Auckland tenants who had left a pot of oil on high heat unattended (which resulted in the property suffering a major fire) were not liable for any of the costs of damage due to the unintentional nature of their actions.
It has taken some time, but as a result of the CoA ruling, the government has just passed the Residential Tenancies Act (RTA) Amendment Bill #2.
This week we look at what the changes in the bill mean for your investment property.
What are Tenants responsible for?
With the CoA ruling, tenants were essentially not responsible for any damage except anything that was intentionally caused. The RTA Amendment Bill now brings back the responsibilities of tenants, even where damage is unintentional.
If the careless actions of a tenant cause damage, they will now be responsible for paying either four weeks rent or the insurance excess (whichever is lesser) to the landlord for repairs.
What do Landlords have to do?
As of 27 August 2019, all tenancy agreements must include an Insurance Clause. Failure to include this clause can result in a $500 penalty per tenancy against the landlord.
This clause must state whether:
1) The Property is insured;
2) If yes, if there is an insurance excess; and
3) The dollar value of the excess
It’s important to note for #2 that there may multiple excesses that apply to your insurance policies – these must all be listed on the agreement.
If you have a Property Manager already looking after your investment property, they should have been in contact to request your insurance information (if they don’t already have this on file).
Need a review?
If you’re not sure about the current excesses in place for your investment property or whether it is adequately insured, we would be more than happy to provide a free review for you.
Please feel free to email email@example.com and one of our advisers will be in touch.