Comeback on tenant damage?

Question from Utpal updated on 17th July 2013:

A while back I had to sell one of my properties below GV. We had signed up in good faith with a property management agency in one of three packages they had offered to us. A tenant had moved in for a one-year fixed term but moved out part way through due to a bitterly cold winter without informing the agent. The house was badly damaged and the garden was completely gone. Due to all these tenant issues, I had to sell it at a loss of around $20,000. I feel if the property manager had acted as per their normal duties and kept the tenant straight (i.e. not allowing the damaging of the garden or the dog poo on carpet), I could have got a better price. I feel my loss has increased a lot due to agent negligence. Can I claim damages for my loss?

Our expert Diane Nelson responded:

Unfortunately no one can guarantee that a tenant will fulfill their duties to pay their rent when due or to care for the property correctly, however good procedures and systems should be able to limit any loss suffered. If the tenant abandoned the tenancy, then they are still liable for lost rent until the property is re-let under a fixed term tenancy. If they damaged the property they are also liable for the damages. I suggest you speak to the agency’s principal to air your thoughts and to find out what processes they had in place for inspecting your property etc, however do be aware that damages can happen overnight. Ultimately the tenant is to blame, and should be held accountable. A landlord insurance product may have protected you against such losses.

Diane Nelson has over 14 years experience as a property manager in the Northland region. She now owns the REAL Landlord Insurance NZ Ltd brokerage and for over six years has specialised in the Landlord Preferred Policy,for investment owners who have their properties professionally managed. Diane also runs property management consultancy business Passionate about Property Management.

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