Always vet the tenant

Just like you wouldn’t lend your brand new car to any stranger, investors should be more active in the tenant management process, even if you outsource your property management to a property manager.

Just recently, a full time investor found out one of his properties were let out to irresponsible tenants. The owner discovered his property in Whangaparaoa was contaminated with Meth after the tenants left without notice. Unfortunately, the tenant vetting process didn’t identify this tenant as a potential problem. Now the owner has to spend over $100k in repairs to make the property livable again.

What can be done to solve this problem? The owner should be active in the tenant selection and vetting process. Before renting out the property to tenants, they should check out the potential tenant’s current house and see the conditions of the house that the tenant is currently living in. This gives some idea of how they will treat your property when they move in.

You can’t just take the previous landlord’s word for it. Everyone’s standards may be different. What is clean and reasonable to one person may be classified as substandard by another. Because the costs of getting your property contaminated with Meth is huge. For this Whangaparaoa property, the tenants were paying $500 per week. Now the landlord finds out it will cost more than $100k to remedy the contamination, which costs the same as 200 weeks of rent. WOW!

The Ministry of Business, Innovation and Employment will soon set out guidelines on meth contamination for landlords, managers, regulators, testers and insurers, giving guidance on how to get a consistent, effective approach for testing and fixing P-contaminated places. This publication is expected to be available on the MBIE’s website in April. This statement from the MBIE is ex post guidance: what to do after your property’s contaminated with harmful substances.


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