Why do I need insurance?
When you own a rental property you should have insurance coverage for your property. If your property is within a Strata Corporation there are multiple insurance policies which could be utilized in protecting the property.
When you rent out your condo or townhouse in British Columbia there should be three insurance policies engaged on the property. The three policies are, the Strata Corporation’s insurance policy, the homeowners policy and the tenants policy. What’s the difference for these types of insurance?.
The tenant policy is often referred to as contents insurance as it mostly covers the contents tenants have within the rental unit. Tenants insurance can include many other features including the option of relocating a tenant and their belongings while repairs are being completed after an event at the property.
The home owners insurance policy covers the requirements for repairing the strata lot. The Strata Corporations insurance policy covers requirements to repair common property.
Many strata lot owners misunderstand the need for insurance for their property, believing the strata has insurance.
The Strata Corporation is responsible for repairing common property and insuring the original fixtures within the strata lot. Insuring and repairing are two different situations which clouds the issue of when a Strata Corporations policy is engaged to repair a strata lot. Inside the unit is not common property, it belongs to the owner of the unit which makes the homeowner responsible for repairing and maintaining their strata lot.
The simple explanation for this is any repairs below the Strata Corporation deductible amount are the owner’s responsibility to repair. How this works is, if your strata has a deductible for water damage of $25,000 and there is water damage to your unit in the amount of $20,000, the homeowner must pay for those repairs. The Strata insurance policy will only be engaged when the damage exceeds the $25,000, as that is the insurable limit.
A homeowner could then engage their insurance policy, pay a deductible to have the $20,000 in damages repaired. The homeowner can also choose to repair the damage without engaging their insurance policy.
We can’t emphasize enough the importance of having proper insurance to protect your investment. Each Strata Corporation will have a declaration page outlining the deductibles for their policy, providing this to your insurer will assist you in acquiring the correct coverage needed. Having insurance and never needing to use it, is the best case scenario. Not having insurance and needing it is an adventure you want to avoid. We aren’t insurance providers and recommend you seek professional advice when it comes to obtaining insurance for your investment
Cartref Properties specializes in managing rental units located within Strata Corporations.
Need assistance with your rental property contact us for an evaluation of your needs.
www.cartrefproperties.com
Duty To Repair
Being a Landlord has many different aspects of responsibility. Landlords provide a place for tenants to live and call home. Often landlords overlook some basic needs and requirements of the property which over the long term can have a greater financial cost to the owner.
Repair and maintenance is one of those needs overlooked. It is important landlords repair and maintain their property to meet health and safety standards required by law. The property doesn’t have to have the most recent appliances or flooring, it needs to have items that are in good working condition.
When a landlord fails to repair and maintain the basic needs of the property, tenants have options to seek compensation from the Residential Tenancy Branch. A recent Residential Tenancy case found a tenant choosing to vacate the property before the end of the fixed term due multiple repairs not completed upon request, including water damage and an inoperable heating system. The RTB determined these issues were material terms of the tenancy agreement providing the tenants the right to end the tenancy early without being held responsible for the remainder of the term. Normally, tenants who terminate a fixed term agreement could be held responsible for the remaining months rent of a fixed term agreement. The rental unit was then vacant for four months until new tenants could be located. The cost of searching and placing a tenant, plus lost rental revenue for four months may have been more costly than completing the repairs to the unit, which still needs to be completed before new tenants occupy the property.
It is important for landlords to complete repairs in a timely manner ensuring costs don’t increase and tenants won’t have opportunities for compensation through the RTB.
One way for landlords to assist in keeping repair costs manageable is, inspect the property regularly. Cartref Properties inspects all properties twice a year and can provide more when owners request additional inspections.
Cartref Properties specializes in managing rental units located within Strata Corporations.
Need assistance with your rental property contact us for an evaluation of your needs.
www.cartrefproperties.com
When 24hrs is not really 24hrs
Owning a rental property requires understanding your rights and your tenants rights. One area that is often misunderstood is access to a tenanted rental unit. Even though you own the property, when the tenant lives in your unit, you must follow the rules regarding accessing the property.
The residential tenancy act provides the authority for landlords to access them under certain conditions. A landlord may inspect the rental unit on a monthly basis when they provide the required notice. Section 29 1,b of the Act requires owners to provide at least 24 hours notice to enter the unit, and that notice must not be more than 30 days before the entry. This notice must also specify why the unit is being accessed, which must be reasonable, the time entry will occur which must happen between 8am and 9pm. Landlords should not provide a notice for inspection then when onsite begin performing repair work to the property without the tenant’s approval.
The confusing part of 24hr notice is how you deliver the notice. If you agree with the tenant verbally or by email on a time then you can access the unit at the agreed upon time. We suggest a confirmation email or letter confirming the verbally agreed upon time for reference in the event there is an issue to the reason for the access.
If you send a letter in the mail or post a notice on the door of the rental unit then you must wait the allotted time for it to be deemed received. Section 90 of the Residential Tenancy Act outlines when documents are considered received. If the notice is mailed it is deemed received 5 days after it is mailed. This means if you mail a 24hr notice and enter the unit before the 6th day, you have not provided the tenant proper notice. If the notice is posted on the unit door or sent by fax, it is deemed received 3 days after, or the fourth day. If the notice is posted on a door on Monday the earliest you can enter is Friday, as the notice is not deemed received until Thursday, then 24hrs would equal Friday.
The Residential Tenancy Act does allow for access without notice in the event of emergency to protect life or property, like in the event of a flood. This is why it is important to have a key for access in the event of an emergency. Other reasons for access include the tenant has abandoned the unit, the landlord has an order from the director authorizing entry, or the tenancy agreement provides for access for services provided which could include housekeeping services.
Cartref Properties specializes in managing rental units located within Strata Corporations.
Need assistance with your rental property contact us for an evaluation of your needs.
www.cartrefproperties.com
Why only rental management?
Managing a rental property in BC can be a complicated process. Cartref Properties provides Rental Property Management services only, we don’t provide sales or strata management services. We feel this eliminates any potential conflict of interest which could arise when providing strata management or sales services for a client.
In a previous post we identified the need for a Strata Corporation who manages individual units in a strata, there must be a primary client identified. The Strata Corporation will always be the larger client and request the rental owner be identified as the secondary client if a conflict arises. Conflicts may arise when a Strata Corporations interest and the individual owners interests aren’t aligned. Providing only rental management services allows Cartref Properties to ensure we aren’t compromising our ability to manage the owners interests.
What is a conflict of interest? I heard it described the other day as “ if you have to evaluate the situation to determine if there is a conflict, there probably is one”.
Cartref Properties specializes in managing rental units located within Strata Corporations.
Need assistance with your rental property contact us for an evaluation of your needs.
www.cartrefproperties.com
Can my strata approve my tenants?
Many Strata Corporations have bylaw restrictions on the owner’s ability to rent their strata lot. The strata property act allows some Strata Corporations to have restrictions on the number of units allowed in their property based on a percentage or number of units, and may limit the time the unit may be rented.
One area the strata is not allowed to restrict is on who you rent your property to. Section 141 of the strata property act outlines the strata corporation is prohibited from establishing screening criteria, requiring the strata to approve potential tenants or asking for specific terms to be inserted into a tenancy agreement you enter into with your tenants.
If your strata corporation is asking for information on who you are renting to or requiring specific terms be included in your tenancy agreement they may be in violation of the Strata Property Act. Owners have the right to make a tenant selection they feel is suitable for their property without strata involvement.
Need assistance with your rental property contact us for an evaluation of your needs.
www.cartrefproperties.com
https://www.bclaws.gov.bc.ca/civix/document/id/complete/statreg/98043_08#section141