Four Things in Covid19 Difficult Times 2020 For Landlords
Being a landord comes with risks and obligations and if you are not mindful, your property can go very wrong.
4 Things To Look Out For When Renting Out During Covid-19 Difficult Times.
1. Due Diligence Checks on Your New Tenants
With border control movements and challenging times, foreign headcount may find themselves without a job, the work pass revoked by the employee, and have to return back home country. It is against the Singapore law for landlords to house tenants without a valid pass. Landlords will face stiff penalties for harbouring illegal immigrants who may attempt to produce fake or invalid passes. It becomes crucial for landlords to be careful and do due diligence checks of all tenants’ identification against their work passes, passports, documents.
2. Be Cautious of Rental Cheats or Tenants Too Good To Be True
Be aware that the recession has produced tenants who cannot fulfil the full lease term, or a premature termination of the lease agreemeent. Tenants who are too quick to secure the unit with a deposit without viewing the unit is one example of red flag. Another case was a tenant who claimed himself as a ‘senior executive’ of a corporate, had asked the landlord for three months free rental in return for a two-year lease. He vanished subsequently after a few months failing to pay rental.
3. Consider an All-Risk Home Insurance
Landlords should take stock of the inventory in their house and consider taking a home insurance to cover against potential mishaps caused by the tenants, or unexpected theft of home content.
It is helpful to cushion your cost in case your tenants accidentially smashed your Smart TV. Or if your luxury penthouse has expensive fittings or chandeliers. A home insurance can help cover home contents replacement, repairs but ‘wear and tear’ circumstances are by large excluded from the policy.
There is a good chance you can get a standard home insurance for less than SGD100 per year in Singapore. An all-risk comprehensive home insurance may start from SGD200. Before you start your tenancy agreement, it is worth your time to find out which home insurance suits better. There are plenty options to consider, just name a few by AXA, AVIVA, AIG, MSIG etc etc. Click here for a free professional consultation on home insurance.
4. Clear Clauses on the Tenancy Agreement
To avoid miscommunication and disputes, it makes sense to put down important matters into the tenancy agreement. For example, which items are to be inluded in the inventory list so the tenants are responsible to reinstate the unit to its original condition upon lease end when the unit is returned. For example, the tenants have to remove the screws on the walls and patch the wall etc etc completing the rectification works before the unit handover.
House repairs are common disputes in tenancies. Don’t underestimate minor repair clause because it puts a threshold to the limits for the tenants and any excess is the cost for the landlord. Be specific to relate the minor repair to per incident per year etc etc. If you are unsure how to go about handling the clauses on the tenancy agreement, you may connect to us.
Being a landlord getting stream of income from rental sounds exciting however the process is not entirely passive. Time, efforts and your involvement is necessary. Nonetheless, you can apply the 4 tips shared above to minimise some headache.