Due diligence for renters – what would you put on your checklist when viewing a rental property? Do you do landlord reference checks, ask for a move-in inspection report and how do you protect your rights?
Renter’s Due Diligence
House Viewing—Do you need a Checklist?
Due diligence is part of the decision making process - asking questions, finding answers and drawing conclusions accordantly. When going through the tenancy application process, it pays to be organised. What that means is to stay focussed on your needs, meet the agent/landlord to check what is on offer and view the property. Launch your tenancy application only if you are satisfied with the level of services you would expect as tenant. Doing so it is very helpful to compose a checklist providing you with some sort of guidance to get the answers you are looking for. A rational assessment eliminates the risks being emotional carried away. You look for a home to live in and also value for money, right?
We all know, that is the theory. Having seen the rental property and spoken to the agent/landlord possibly there are some adjustments to make. But still if the house would satisfy your rental needs, you are possibly willing to sign a tenancy accepted by all parties involved. To get to this point what would you put on your checklist?
If you are conversant with the renting culture (note the differences between countries, regions, housing types), you will prepare your checklist accordantly. To sharpen your mind when renting a stand-along house for instance you deal mostly with the landlord directly (at least in my region). For renting apartments or student flats you will talk commonly to letting agents. Here is not a fixed rule, so—be prepared and interview the agent/landlord, too.
Properties held by (passive) investors are often managed by property managers. On the opposite landlords (private owners, landlord businesses) who exercise ownership (maintenance, repair, management) also try to match property type and suitable (preferred) tenants.
The third group I would call short-term investors (speculators is a common term) who hold investment properties for a short periods of time with the intention to sell them on. That is often the case with cash-flow negative properties (loss producing investments). Those people try to compensate loss by selling for profit. Trigger points are driven by housing politics, interest rates, and also by changes of policies, taxation etc. Details you find in separate blog posts—check the blog post library.
With this above in mind you need to figure out:
· Whom you are dealing with?
· How does your prospective agent/landlord operate?
· What do other people (previous tenants) say?
Note; reference checks are not a one-way road. Ask questions and get answers which make sense to you. You want to build trust, make sure the rental is available as long as you need it, and find an agent/landlord who is providing the services you need.
Congratulations. The tenancy agreement has been signed. At this point maybe exhausted, but still one important thing to take care off—getting the keys and a move-in inspection report.
Meet the agent/landlord at the premises, walk through the property, sign a move-in inspection report and get a copy. After years of renting who can remember the conditions at the begin of a tenancy? Be certain a move-in inspection report protects both parties.
A missing move-in inspection report is one of the common reasons why tenancies fail. Take the inspection report as insurance that everything is up to agreed standards and nobody be held responsible for damage done by previous parties.
Important to ask for the event of emergencies
· Where are (if any) shut off valves for cold and hot water
· Fuse box and electric main switch
· User manuals for appliances (kitchen, laundry)
For instance we provide for each rental property a booklet with contact details, information to deal with unforeseen situations like power faults, water leaks and practical tips.
Signing an agreement or tenancy is a matter of trust. Building trust requires a certain level of transparency and rules to exercise both parties’ rights (written contract/tenancy). To get to this point landlord’s screening process and renter’s home inspection are common ways to satisfy both parties. Make good decisions, choose your partners and find your destiny.
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Klauster Properties Ltd - Renter’s Blog
Rent or Own - Decision at some stage in life?
Renter’s Blog lead to a real person, IT professional, investor, landlord and business owner with interests in sharing experiences. Life is a dream with a deadline, happiness comes from making the right choices and having realistic expectations.
Confession: I have been a happy renter for more than 25 years before buying a family home and later becoming involved in property investments and developments.
I used to live in apartments or rental homes, worked in many different countries and experienced different housing standards and renting cultures. I would love to see a social and legal frame work around housing policies that supports renters and landlords alike.