Chapter News

The importance of ingoing inspections

1 December 2014
By Sandra McGee - Starr Partners Merrylands

  In the second part of this three-part series, REINSW is talking about the importance of the initial ingoing condition property inspection report for property managers. Brush up on your inspection requirements with Starr Partners Merrylands Property Management Manager and REINSW Property Management Chapter committee member Sandra McGee.

Legally it’s a must
The most important thing property managers should know about ingoing condition inspections is that the document is part of the tenancy agreement, so if the agent fails to complete this inspection then the agreement could be classed as void. It is not the tenant’s responsibility to fill out the condition report, it is the agent’s or landlord’s responsibility. Do not give the tenant a blank form and ask them to complete it.

Under the legislation, the document is prescribed and must be filled out in the correct way. Agents must write ‘yes’ or ‘no’ in the relevant columns and then continue to complete the condition report with comments, adding extra pages to the form if needed. This concept seems very straight forward, but many property managers get this wrong. They fail to take the time necessary to do a comprehensive report.

Agents may create their own documents, however it must comply with legislation and include all of the prescribed elements.

Photos are a great inclusion with the document, however they are there to back up the information that is in the document. If a property manager takes 200 photos during the ingoing inspection, it means nothing if the condition report is not filled out correctly. Date stamp all photos for clarity.

A thorough check

Property managers must ensure they complete a thorough ingoing written condition report. The condition report must outline what the property looks like at the beginning of the tenancy. It should be a true report setting out the condition of the property. Not just a few ticked boxes.

Many property managers believe this is a time consuming process, however I couldn’t disagree more. Spending time on this procedure will save you time at the end of the tenancy when the tenant vacates. It not only stops disputes with tenants, but also with landlords who may have not seen their property for many years. Writing comments and taking the time to outline any possible issues will save you time, stress and worry in the event of a tribunal hearing with the tenant or the landlord. It may even assist in preventing the need to go to NCAT.

Things property managers should also include in the condition report:

  • when the property was last painted 
  • when the carpets were changed/cleaned
  • when the blinds were installed
  • any external items 
  • dates and times on installed items around the property

Again, photos do not replace the condition report, but it is good to have them and possibly a short video too.

Tenant’s responsibility

Once the condition report is completed by the property manager, they must give the tenant a copy of the form when the lease is signed. The property manager should never sign a lease document without the condition report attached. If the report is not attached, you may find that the tenant cannot be held liable for any damage that has occurred during the tenancy. The process to receive any compensation from a tenant, without having a condition report, is extremely hard.

When you are signing the lease, explain the condition report to the tenant. Outline their responsibility in relation to the report. Show them how to complete the report, the time frame that the report should be returned in and the general importance of the report. Make sure the tenants understand that if they write ‘no’ against an item they should provide a comment explaining why they said ‘no’. Encourage them to take photos for their own benefit. 

It is also the agent’s responsibility to remind the tenants if they fail to return the condition report within the required seven days. At Starr Partners Merrylands, we send the tenant a welcome letter with a reminder to return the condition report. This letter is mailed to the property after the lease is signed for the tenants to receive a few days later. Tenant's are so busy moving on the lease signing day and I am sure that all they want are the keys to the property, the copy of the lease and to run out of our office. They are not going to read anything else. That is why we mail them the letter.

If the tenants fail to return the report, we then send them another reminder approximately 14 days after they move in. If the tenant does not return the report at all, when they vacate the property they forfeit their right to have a say in the condition of the house. 

Remember, it is not up to the tenant to complete the initial condition report. The property manager must provide them with copy of the condition report they have filled out prior to the lease being signed.