EPMEPM: Best Practice & Legislation

A secure rental can mean a secure tenant: Sharon Fox-Slater

One in 40 Australian homes are burgled each year, sending a clear message to landlords and agents about the importance of security at rentals, says Sharon Fox-Slater.

Home burglary is one of the most widespread crimes in Australia with more than 300,000 break-ins recorded each year, according to the Australian Institute of Criminology. This sobering statistic coincides with a number of new initiatives that shine a spotlight on the provision of security at rentals.

Several state governments are currently reviewing tenancy legislation (and specifically minimum standards) while the Australian Housing and Urban Research Institute’s latest report calls for minimum property standards in relation to safety and security to be introduced across the nation.

The issue of “reasonable security” was also highlighted by two recent Northern Territory Civil and Administrative Tribunal (NTCAT) rulings. In both cases, NTCAT held the landlords liable for the losses suffered by their tenants when the level of security provided at each rental property was determined not to be “reasonable”.

One landlord was required to pay $3,234 in compensation to their tenant for failing to provide adequate security and, in the second case, the payout was in excess of $5,000 after a third break-in at the rental in less than seven months exposed the property’s security failings.

The two cases may set a legal precedent and highlight the need for landlords to provide “reasonable security” at their rentals – and for agents to ensure owners meet their obligation. What constitutes “reasonable security” is not defined in all state/territory residential tenancy laws but when determining what level of security would be reasonable, factors such as the crime rate in the area, the minimum security requirements specified by various state/territory legislation (for example in relation to door locks, window locks and exterior lights) and the property’s history in terms of attempted/successful break-ins, should be taken into consideration.

So what security measures work best? To find out, a team from Edith Cowan University surveyed a group of thieves. The top deterrents were found to be:

  • dogs (61.4 per cent cited this as the top deterrent)
  • working alarm system (49.1 per cent)
  • functioning sensor lights (22.8 per cent)
  • lights on within the property (19.3 per cent)
  • security grilles on windows and/or doors (19 per cent)
  • visibility of the property from the road (14 per cent)
  • unknown area (14 per cent)
  • presence of gates (12.3 per cent).

Landlords and agents not only have a duty of care to their tenants, they also have a vested interest in providing good security – it can reflect positively on the management and care of the property and increase its desirability for potential tenants (some tenants may also be willing to pay more for a home with better security).

Properties offering good security not only appeal to renters, but to insurers too.

Insurers may also determine the appropriateness of the security measures (e.g. locks and devices) when they assess the property’s risk profile at the time the landlord applies for building/contents cover or the tenant applies for contents cover.

Maintenance of basic security is likely to be mandatory for cover to be provided for the property, whilst increased security may result in lower premiums.

The Australian Bureau of Statistics notes that almost half of all break-ins result in property damage, as well as theft of items, so extra security can also help mitigate the risk of damage from break-ins. This is not only a positive for insurers (in terms of the cost of repairs), but also for landlords and agents as it can limit the subsequent costs associated to increased workload and impact on the financial performance of the premises, such as having to lower the rent while repairs are carried out, or having the property unlettable because of damage.

Ultimately, the provision of enhanced security measures, coupled with the right insurances, could save landlords, tenants and agents from the fall-out of a break-in and provide a sense of security that translates into a mutually beneficial tenancy.

Our advice about insurance is provided for your general information and does not take into account your individual needs. You should read the Product Disclosure Statement and Policy Wording prior to making a decision; these can be obtained directly from EBM. For more information, visit www.rentcover.com.au 

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Sharon Fox-Slater

Sharon Fox-Slater is the Executive General Manager of EBM’s RentCover, which insures 120,000 investment properties around Australia and creates covers specifically for the property industry. Sharon was also the first woman to become a Fellow of the National Insurance Brokers Association. For more information, visit rentcover.com.au.
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