Renting out your home is a great way to make some extra cash. However, as with any type of business, make sure you go into your lucrative venture with your eyes open to ensure you\u2019re not faced with a court case and left bankrupt.<\/p>\n
When you deal with customers \u2013 even if they just stay in your spare room \u2013 there are always a number of risks involved, such as theft, damages and injuries, noted financial services company, Santam.<\/p>\n
There are three distinctly different types of risk related to renting out a home:<\/p>\n
It\u2019s all about timing<\/strong><\/p>\n The amount of risk you are taking depends on what basis you are renting out your home, spare room or even couch. If you are still the main occupant of the home and only rent it out on an ad hoc basis, the liability cover in your home contents\u2019 insurance should pay out in the event of a claim.<\/p>\n However, if your property is mostly used for short-term rentals, your insurance provider will view it as a commercial risk and suggest that you take out business cover.<\/p>\n How to cover your back<\/strong><\/p>\n Speak to your insurer<\/strong>: Tell them exactly what you are renting out (e.g. a granny flat, spare room, or your entire home for the months of December and January). Rather be transparent than be caught off guard when it comes to claim stage. Even though some accommodation providers offer a type of host guarantee, don\u2019t rely on this. This should not be considered as a replacement or stand-in for homeowner\u2019s insurance.<\/p>\n Maintain your property<\/strong>: Make sure your home, garden, steps, paths, etc. are kept in a good condition, free of any hazards which could cause injury. Walk around your property and see it from a tenant\u2019s point of view. Make sure areas are well-lit, dangerous objects are locked away from small children, etc.<\/p>\n Communicate clearly with your tenants<\/strong>: Should there be a break-in, most insurance policies will require visible and forcible entry in order to pay out. If your guests forgot to activate the alarm or left your front door unlocked, you might not be covered. Therefore it is a good idea to have a signed agreement with your guests so that they are made aware that they will be held liable for any stolen or damaged items if there are no signs of forced entry.<\/p>\n Write it all down<\/strong>: Overseas visitors don\u2019t always understand the risks of crime in South Africa, so it\u2019s a good idea to give them a few pointers on staying safe \u2013 e.g. don\u2019t leave any items in your car, don\u2019t put valuables near an open window, lock doors \u2013 and also specific written instructions on activating your alarm. Include this in your welcome pack along with important numbers such as those of your security company and the local police station.<\/p>\n Read the full article here<\/a><\/p>\n Conveyancing fees: this is what you are paying for<\/strong><\/a><\/p>\n What you should know about house evictions in South Africa<\/strong><\/a><\/p>\nMore on financial services<\/h3>\n