If your tenant causes damage to your rental property, what can you do? We explain how to identify the type of damage which has occurred, how to recover any costs and what your next step should be.
Broken windows, cigarette burns in the carpet or holes in the walls: if your tenant causes damage to your rental, what can you do? The answer depends on the way the damaged has occurred:
- Accidental damage – the tenant cannot be held liable to pay for losses if the landlord had the property insured.
- Intentional damage – the tenant can be held liable for all repairs.
- Wear and tear damage – the tenant cannot be held responsible for fair wear and tear of a
rental property.
- Neglectful damage – if the tenant fails to inform the landlord about any damage or
maintenance issue and it gets worse, they may be liable for some repair costs.
- Fire, flood, explosion or natural events – the tenant is not liable.
Once you have inspected the damage and spoken with the tenant as to how it has occurred, you are most likely able to identify the type of damage it is. This does rely upon the tenant’s honesty to a large degree, as well as the circumstances around the damaging event and the damage itself.
If the tenant agrees with your decision as to the type of damage, you are able to put steps in place to remedy the situation. For accidental damage and fair wear and tear, this comes out of your pocket or your insurer’s. For neglectful or intentional damage, your tenant is responsible for some or all of the costs.
But what do you do if you and your tenant disagree on the type of damage it is? Claiming Costs When Your Tenant Causes Damage
In 2016, the Holler v Osaki [2016] NZCA 130 case found that the tenant could not be held responsible for losses caused when an unattended pot of oil was left on the stove caught fire. The insurer was unable to pursue the tenant for damages, and the landlord was left out of pocket for the policy excess.
What can you do if your tenant causes damage? If the damage was intentional, the result of a tenant committing a crime, or their actions would cause the insurer not to pay out, they should be liable. You can send a 14-day notice to remedy the situation or recover costs. If this notice is not met, then you need to contact the Tenancy Tribunal. Most likely a mediator will work with all parties to try to reach an agreement. If an agreement is not reached, then a Tenancy Tribunal hearing will take place and the decision will be legally binding.
So, how can you best protect yourself and your rental? By hiring a property manager to find and vet your tenants, perform pre and post tenancy inspections and regular inspections. Should problems arise, they will be able to manage everything on your behalf. Give us a call and learn more about ourproperty management packages today.
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