Water Damage – Rental Property How-to For Landlords


Owning a rental property can be an excellent investment, but when water damage strikes, it can quickly become a logistical and financial headache when water damage strikes. 

The key to limiting water damage is early detection and swift action. And that means initiating an urgent repair solution when it’s needed most. This is also an essential service, under Australian law.

How Bad Can Water Damage Really Be?

Approximately 34% of Australian landlords have experienced some form of water damage in their rental properties. Making matters worse, water damage claims accounted for nearly 20% of all insurance claims made by landlords in Australia in 2020. 

This shows these kinds of issues’ severity and just how often they can occur. So, as a landlord, you need to be prepared. That includes knowing what your insurance covers and if your property manager has made sure all responsibilities are clear in the tenancy agreement. 

Detecting Signs of Water Damage in Your Rental Property

Incessant Drips or Leaks : This might seem obvious, but constant dripping or visible leaks from pipes, taps, sinks, showers or any other water source should raise immediate red flags. Remember, even a small leak could lead to a greater issue down the line, especially if there’s a burst water service involved.

Discolouration on Walls, Floors or Ceilings:  Water leaks often leave conspicuous discolouration in their aftermath. These markings usually come in shades of brown or yellow. If you or your tenant notice any such signs, it’s a call for action. 

Mould:  Whenever there’s excessive moisture, conditions become ripe for mould to grow. Pay heed to the signs of black or green spots on your walls, floors, and even furniture. Not only is it a sign of a water problem, but it can also pose health risks to your tenants. 

Unusual or Bad Odours:  Water damage usually has a peculiar musty smell. If your tenants complain about foul odours or you notice it during a visit, it could be a sign of an unseen water problem. 

Staying alert to these telltale signs and taking immediate action can mitigate potential damage and save you from substantial costs in the future. 

Immediate Steps to Mitigate Water Damage on a Rented Property

When you notice the first signs of water damage, taking immediate action can prevent further harm. Here’s how you can mitigate damage:

Shut Off the Water Supply 

If the damage emanates from a domestic water source, like a blocked or broken toilet, roof leak, or busted pipe or leaks, your first step is limiting further water intrusion. 

Prop up a ladder to reach valves elevated above ground level, if necessary. To be more precise, it’s about controlling the situation until a professional can address it fully. This simple step can prevent an isolated pocket of water damage from spreading to wider swaths of your property. 

Document the Damage 

While at the scene, your phone serves an important purpose: documentation. Snap pictures or record videos of the affected areas. Try grabbing shots from multiple angles, ensuring you capture the extent of the damage. 

This evidence is useful during insurance claims, enabling you to prove the preexisting condition and the damage after the event. Taking comprehensive notes about what was affected and potential causes can also be extremely helpful in the process. 

Contact the Professionals 

Estimate the severity of the problem. You can sometimes handle small issues like a minor leak or a small area of dampness. However, bigger problems warrant a call to professionals. The high stakes involved in your rental property make professional solutions valuable.

Inform Your Insurance Provider 

After documenting the water damage and initiating the cleanup process, it’s time to notify your insurance provider, Duo Insurance.

You can upload your claim through our website, with your collected evidence and details about the specific event. Most providers will require prompt notification of any incidents to ensure accurate coverage. Collaborate extensively, following any procedures needed, so that you can gain potential financial help toward the repair costs. 

Effective Communication with Tenants Regarding Water Damage Scenarios

Communicating effectively with your tenants about potential water damage scenarios is vital to not only protecting your property but also maintaining a good landlord-tenant agreement.

Firstly, giving your tenants rent education by providing them with the information they need on the potential causes of water damage is essential. 

This can include various issues, from simple water leaks to major events like heavy rainfall or flooding. You can consider creating a tenant handbook or guide highlighting these potential risks, including where they can find water shut-off valves and what to do in case of a burst pipe or flood.

Tenant Responsibilities for Water Leaks & Damage

As a landlord, you are responsible for providing a safe and livable environment on the residential premises. Still, tenants also have certain responsibilities to report and prevent damage to the property.

Ensure your tenants understand their obligations with respect to maintaining the condition of their accommodation, including taking care of any water leaks and damage. The landlord responsible for solving the issue will be expected to do so, but the tenant needs to bring it to his attention as soon as possible first.

This is especially the case if it’s a serious water service leak, and not just something that needs a non-urgent repair.

The tenant’s responsibility for water leaks and damage to a rental should include:  

  • Identify and promptly report any signs of leaks such as staining, dampness or mould.
  • Bring attention to dangerous electrical fault flooding.
  • Pay attention to and report any declining condition in the bathroom, kitchen, and laundry areas, including tiles, grout, sealants, and plumbing fixtures.
  • Take necessary precautions to prevent pipes from freezing in winter, such as maintaining sufficient heating.
  • Ensure the correct use of appliances such as the dishwasher and washing machine to prevent accidental water overflows or leakages.
  • Report any issues with the roofing or guttering, especially during rainy seasons.

Why Tenants Need to Identify Water Leaks Early

Addressing water leaks swiftly is crucial in mitigating severe damage; therefore, tenants play a vital role. When your tenant is diligent about keeping an eye out and notifying you promptly, the potential for major repair and cleanup costs could be significantly reduced. 

If water damage is left unattended, it could lead to more extensive issues like structural instability, mould growth, and electrical hazards. These issues are not just costly to fix, but can also pose serious health risks to your tenants and may violate habitability laws. 

Emphasising the importance of early detection to your tenants should be a part of your tenancy agreement. Make it clear to them that they are your first line of defence against water damage, and their prompt action can save both you and them numerous headaches in the future. 

Remember, a well-informed tenant and open lines of communication are invaluable tools in preventing excessive water damage to your rental property.

The Landlord’s Responsibility for Water Leaks & Damage

As a landlord in Australia, it’s crucial to understand your responsibilities regarding water leaks and damage within your rental property.

Keeping up with necessary repairs and maintenance is not just a small part of being a good landlord, but it’s a requirement set out by law. Let’s delve a bit deeper into your duties and responsibilities, shall we? 

Maintaining a Habitable Environment 

First and foremost, under the Residential Tenancies Act, landlords need to keep their rental properties in a state that’s ready for habitation.

This includes ensuring that the property is structurally sound and free from any leaks or other significant water damage. If a leak does occur, it is the landlord’s responsibility to act quickly and arrange for it to be fixed. 

Urgent And Non-Urgent Repairs 

It’s crucial to understand the difference between urgent and non-urgent repairs. Urgent repairs tend to directly affect the tenant’s health or safety, such as a major water leak. In such scenarios, the landlord is required by law to respond immediately. 

On the other hand, non-urgent repairs, like a dripping tap, although needing attention, carry a different level of urgency. However, they should still be addressed promptly to prevent further damage

Recovery of Costs 

Leaks and water damage might lead to significant repair costs. But, if the tenant is responsible for the damage due to negligence, misuse or failure to report the issue promptly, you have the right, as the landlord, to recover these costs from the tenant.

Remember, it’s prudent to have a written rental agreement specifying such details to mitigate disagreements that may arise. 

Reimbursement for Alternate Accommodation 

If the water damage is so severe that the rental premises become uninhabitable, the landlord might be required to reimburse the tenant for any necessary alternative accommodation. This responsibility can vary case by case, and it’s best to seek legal advice if it comes to this.

In conclusion, fostering open communication lines and practising proactiveness in handling potential water damage scenarios can save both you and your tenants a lot of stress and costs in the long run.

Emergency Contact Information 

Ensuring your tenants have a list of crucial emergency contacts can make a world of difference when time is of the essence. In an ideal scenario, tenants should be able to contact you, the local plumber, and your assigned water damage restoration professional. Regularly update this list and share it with your tenants. 

Additionally, tenants need to understand under which scenarios they should contact each person. Clear instructions about the proper contact for different types of emergencies can prevent confusion and expedite response times. 

Is Water Damage Covered Under Landlord Insurance in Australia?

Typically, landlord insurance does cover water damage, but it’s crucial to note that the specifics vary from policy to policy. 

Burst pipes, leaky appliances, or storm issues generally fall under the coverage umbrella. However, reviewing your policy documentation ensures your understanding matches your provider’s. 

In situations where the damage arises from gradual deterioration—such as long-term leaks, poor maintenance or neglect—it may not be included in your landlord coverage

Additionally, instances of flooding caused by external factors, like river overflow or surface water run-off, can often fall under a different clause as a ‘flood damage’, which may require additional coverage. 

Due to these complexities, we highly advise you to thoroughly understand your landlord insurance policy. The team at Duo Insurance can help you navigate what’s included in your coverage, or provide you with a better option to keep you and your rental property safe from water damage in the future.

In the end, it’s all about ensuring your rental property’s durability and generating a stable return on your investment. 

Key Takeaways

  • Look out for potential signs of water damage, such as discolouration of walls, mould growth, dampness, or a musty smell in your rental property.
  • If water damage occurs, immediately get into action by shutting off the water supply, documenting the damage, getting in touch with water damage professionals, and informing your insurance provider.
  • Maintain clear communication with tenants about water damage scenarios, conveying the importance of early identification of water leaks and educating tenants on their responsibilities in such cases.
  • Understand and fulfil your responsibilities as a landlord, including ensuring a habitable environment for tenants, handling both urgent and non-urgent repairs, covering costs of damage initially, providing reimbursement for alternative accommodation, and sharing emergency contact information.
  • Most insurance policies for landlords in Australia usually cover water damage, but it’s recommended to check your policy for specific coverage terms and conditions thoroughly. Contact Duo Insurance to find the best policy for you.

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