Daily Telegraph (Sydney) 10/7/06 - Property
Behind broken doors
Investment property is still a high priority for Australians as part of their wealth strategy, but it comes at a cost.
Suicide, assault, malicious damage and the cultivation of drug crops are among the leading causes of extra costs to maintaining rental properties Terri Scheer Insurance said.
"Our figures show that over the past five years the average claim paid for malicious damage on our landlord insurance policy has
increased by 275 per cent." Ms Scheer said "Five years ago, the average claim of this type was $800 today the average is $3000."
Despite this, more than half of us own an investment property or are considering buying one in the next 10 years.
"Property is more tangible and understandable than other investments." ICA financial planning and superannuation manager Hugh Elvy said.
"With many Australians having experienced their own home increase in value, an investment property is considered an attractive investment."
However, for many the dream of wealth accumulation can turn into a nightmare when the property is damaged.
"Some landlord insurance claims amount to tens of thousands of dollars." Ms Scheer said.
In almost all the cases of malicious damage, the bond paid by the tenant was not enough to recover repair costs, she said, listing the top causes of damage as
- HOLES punched, kicked in walls and doors.
- INSTALLATION of hydroponics systems to grow drugs.
- GRAFFITI
- BROKEN windows
- SUICIDE
- ASSAULT of a tenant
- FIRE
Most inspections are 12 weekly and a tenant can sow and harvest a crop in exactly 12 weeks, she said.
"We've even had a sunken lounge filled in with soil and people growing vegetables in it."
But she said even more common was damage as a result of murder, suicide and assault.
