If the New Year’s resolutions you made on 1 January have gone by the wayside, now’s the time to have another go with Lunar New Year in full swing.
On 5 February 2019, the Year of the Pig was ushered in. In Chinese folklore, pigs are the symbol of wealth and their chubby faces and big ears are signs of fortune. So, why not take an acorn from their trough and set yourself up for a productive and profitable 12 months by adopting these six New Year resolutions?
Whether your policies are due for renewal or not, the start of the year is an opportune time to check that your insurance covers are up-to-date. For property covers (like your investment property), make sure to review the sum insured so your cover is adequate.
You should also check that you have the right type of landlord policy for the way you are leasing your rental (different policies are needed for fixed-term tenancies and short-term leases).
If there have been any material changes to your investment property, such as being vacant, renovated or changes to the way it is leased, make sure you advise your insurer.
If you don’t already have comprehensive landlord cover (for example you are relying on a standard home-and-contents policy), it’s time to look at your options.
Landlord insurance provides cover for a range of insured events as well as financial protections for tenant-related issues like rental losses or damage.
It may also be wise to remind tenants that they need renters’ contents insurance as your landlord’s insurance won’t cover a tenant’s personal belongings if they get damaged or lost in events like theft, fire and storm.
Repairs, urgent and otherwise, need to be attended to in a timely manner. Make sure you and your agent know and adhere to your obligations under the law.
Adequately maintaining the property is a requirement for insurance cover and failing to do so could render the policy void.
So, keep on top of regular upkeep with an effective scheduling system – it will not only keep tenants on side, but also safeguard the property’s insurance cover. It can also be very cost-effective to tackle minor repairs and maintenance before they become major issues.
If you don’t have one already, consider starting an ‘emergency fund’ so that you can get on top of repairs and maintenance quickly and without having to worry about where the money will come from if you get that call from your agent or tenant.
It also means you could have money in reserve to tackle an overdue project at the investment property or weather a few more weeks if your rental is untenanted for longer than expected.
Remember: you can’t claim for loss of rent through your landlord insurance if the reason you aren’t getting rent is because the property is not leased – this is a risk you assume with your investment and can’t be mitigated with insurance.
It’s important that you and your agent understand any obligations that are part of insurance coverage.
One of the most important obligations is to help mitigate further loss by taking swift action if the property is damaged. Chat to your agent about their authority to act on your behalf.
Having trusted, reliable and quality tradies and contractors on speed dial is a must. If you self-manage, check that the ones on your list are still available (it’s been a bit of a topsy turvy time for trades and many have moved on or ceased trading), licensed, insured and have current police clearances.
Cultivate a preferred vendors list and make sure to check their references.
If the New Year sees a changeover in tenancies, carefully vet any prospective new renters – or make sure your agent does.
Don’t scrimp on the checks – references, employment, credit – even if it has been difficult to lease the property. While some may think it’s better to have any tenant than no tenant at all, having the wrong tenant can be costly if they fail to pay rent or damage the property.
Adopt a thorough and consistent screening process – and apply it each time. Give your agent instructions but consider your options too (like becoming pets-allowed or offering longer leases) to increase your chances of securing excellent tenants.
A pet peeve of tenants is when they put in a request, either with you or via your agent, and don’t hear back. Good communication between you and your agent and tenant is a key to keeping your investment running smoothly.
Happy tenants are more likely to stay longer and look after your property better than those who are forever chasing up their requests. If there is an issue that needs to be resolved, get back to your tenant or agent promptly and give them a timeframe for the matter to be addressed.
If you do your own inspections (or when you get the inspection report back from your agent), a little praise for the tenant when it’s deserved doesn’t go astray either. It helps build rapport and you don’t just come across as the ‘nag’ with a list of problems they need to fix but as someone who appreciates their efforts.
Real estate is constantly evolving and you need to stay on top of new rules and requirements, like reforms to tenancy legislation or tax regimes – especially if you are self-managing (if you are, perhaps this is the year to engage professional property management services and relieve yourself of the burden).
Much like law, when it comes to insurance, ignorance is no excuse for not doing what is required. Make sure you understand what your insurance policies do and don’t cover and what you need to do to meet your obligations under the policy.
Start the New Year as you mean to go on by turning your resolutions into realities. If you do, the Year of the Pig may just prove to be auspicious and prosperous!