The Importance of Professional Property Management for Overseas Owners

Just last week we were asked to appraise a three-bedroom townhouse in Merivale.

The owner purchased the property three years ago, and then was offered work in Australia where he has lived for the past three years.  He offered the property to his friend to live in at a greatly discounted rental rate per week.  He has not been back to Christchurch to visit the property since he left.  His friend has indicated that he will be vacating the property in a couple of months which prompted the owner to call us and request an appraisal of the home comparable to those properties available in today’s rental market.

We arrived at the property to find that his friend had not looked after the property at all during his three year stay.  The gardens are overgrown; black mould has been found throughout the home and worse in the bathrooms and laundry; the carpets are in such a poor state they will require replacement and the kitchen vinyl has bene ripped and torn in a number of places.  The hobs and stove have not been cleaned sufficiently and as a result they have rusted to the point where they require replacement.

For us this is too often a common story, resulting in loss of investment on a rental home due to poor management.

In this instance the home was not inspected frequently as it should have been.  Regular inspection will ensure that preventative maintenance items can be performed, as well as keeping tenants in line should they not be keeping a home reasonably clean and tidy. More importantly if you need to put in an insurance claim on a rental property the first thing they will ask for is  documented inspections for the last 12 months. Failure to supply these will often result in a claim being declined.

It is also a legal requirement under the residential Tenancies Act that should an owner be overseas for more than 21 days that a representative be elected in the home city as an emergency contact for tenants.  In this case the owner had asked a family friend to keep “an eye over” the property. This did not happen, and had the owner appointed a property manager the legal responsibility would have been in place to perform regular inspections with both written and photographic reports to the owner and tenant.

In light of this story, we would urge private landlords who reside overseas to consider property management, our management fee is your insurance and protection whilst you are away.