10 year leases

One other issue to raise is the one of insurance. In a comm lease we can demand to see an insurance certificate for the property. This needs to be addresses for resi as well. Eg. If the tenant doesn't clean the range hood and the house burns down, THEIR insurance needs to cover it. At present there is no such policy where by a tenant can protect property damage. (They can only get contents insurance). I asked about this sort of
policy a while ago on SS.

 

Tenants can insure against legal liability (usually in contents insurance). So in your example if they are deemed to be legally liable (negligence?) for the house burning down their insurance will pay out. Whether you can force them to take insurance is another matter.

 

My post from SS (which didn't find a solution.)

The EBM Tenant Cover mentioned in the thread proved to be a no-go as well. I passed on the info to the other forum and the lady rang and was told NO for the situation listed.

 

Insurance is a complex area. I'm no lawyer - so take what a say with a handful of salt. I'd imagine each claim will come down to both law and fact, and be quite unique. Happy to hear from the lawyers here.

Many years ago when I rented there was a house fire at the place I rented and the fire brigade determined I was responsible (BF actually). My contents insurance paid for all repairs to the house and my contents. I/BF was clearly negligent - who disposes of a ciggi butt in a waste paper bin just below storage of toilet paper? BTW the LL was delighted, she got a new bathroom and repaint for nix.

Glass door/stone example -
Perhaps there was no legal liability because a stone flying up and smashing glass when whipper snipping is not a negligent event?

 

I tried to find a more certain answer to the glass door example by looking at RACQ's PDS, got too side tracked, and gave up.

The amusing thing is, I discovered that you can claim for theft of water (tank only).

 

Yeah I don't doubt it was not a negligent event That seems to be the problem.. If the house was owner occupied, this "accident" would have been covered by her building insurance ( and more than likely is by the LL's insurance as well) but resi tenant insurance does not seem to cover accidental damage.

Comm leased premises do... we lease the factory we run our business out of and our contents insurance covers accidental damage to the building. anywhoo we are straying off track

 

Firstly, the tenant would probably be negligent and therefore legally liable in this scenario.

But even if they weren't (or couldn't afford to pay out), it would simply be an insurance issue where I'm sure there would soon be a landlord product to cover this scenario - if there wasn't one already (I would have thought it was covered in most building insurance contracts).

 

I'm not sure of the 10 year lease idea, however longer leases, lets say 2-5 years are a potentially very good idea in my opinion for an investor, with a view to offering less changeover costs and frictions to the land lord and allowing the tenant to be more stable in a school catchment area as one example.

 

Yes I agree, this model seems superior to me to the way we traditionally run our residential leases here.

 

Would or should a lease longer than a year have a CPI or similar rent increase included? Is this fair to the tenant and LL? How about provision for the tenant to terminate due to unforseen circumstances, say the job moves interstate? If there was terminatoin then I envisage the tenant paying the LL's reasonable costs to find a new tenant so that the LL is not out of pocket.

 

There would definitely be problems to work through if and when this style of lease was implemented, but why so much negativity towards what would effectively be just another option for tenants and landlords to choose from?

I don't think this style of lease would ever replace the current style, but be an alternative, so I don't understand why anyone would summarily dismiss this as an alternative, which a lot of posters seem to be doing.

 

I agree jafeica. If a standard lease was available that was fair to both parties, not just the tenant, as a landlord you should have some interest.

There are plenty of tenants that are residing in the property for over 10 years and many others that would like to do the same.

 

My bad. I understood that whoever's idea it was wanted these leases to become mandatory rather than supplementing existing leases. As an alternative they would be fine.

 

I would agree with this, and it would have to be more in line with commercial agreements whereby the tenant takes on the accountability.

I don't get that excited about any government initiative these days as they are usually reactionary, shoot from the hip, get re-elected, who can we dump this on type ideas.

Until I see a brainstrust with the greater interest for future growth and development at the core of any initiative put forward which has no political interest then I will hold my breathe.