Methamphetamine (‘ice’) - a new risk for property management businesses

Methamphetamine (‘ice’) is a highly addictive stimulant that affects the central nervous system and can easily be made in small clandestine laboratories - making rental properties an ideal location. The ingredients used in its production are relatively inexpensive and are readily available, meaning this drug is becoming a serious issue for landlords and property managers.

Severe damage can occur to a property and the health of its inhabitants from production of ice in a property as well as occasional use from a past tenant.

Unfortunately we have now reached a point in Australia where businesses need to learn what to look for, what advice to provide their landlords and how to be safe.

The Damage

If ice has been used or cooked, the chemicals silently infect all facets of the property - think carpet, blinds, plasterboard, ceilings, fan vents, air conditioning and all ducting!

For the landlord, this means their property will need everything expertly removed to contain the contamination following a tenant using ice in the property.

For a new tenant moving into an affected property, they will not know that there is any damage if there are no obvious signs. It will only be when their health is affected or a neighbour alerts them to the ‘suspicious’ previous tenants that they realise they may be in danger.

We have recently contacted all four major insurance companies to review whether there is insurance available to landlords (and owner occupiers) for damage of this kind and so far there is not. Where illegal activity occurs in a property, insurance companies will not cover the cost of damages. For example running a casino. The lack of coverage for such damage is a major concern for landlords as ‘gutting’ a property is required - we’ve seen bills as high as $200k for repair.

What can a property manager do?

If ice is becoming a problem or being used in your area then it’s time to take action and speak with your landlords about how best to protect themselves. If you’re not sure, the local police are the best informed people to educate you on this.

If it’s in your area, the preventative action is to employ a meth inspection company to commence testing homes between tenancies. Add the inspection report as an attachment to your condition report and advise the incoming tenant that the home has been inspected and will also be inspected at the end of the tenancy. Your landlord will be paying this cost so remember to get their permission. Let them know that with a lack of insurance cover available to a landlord this is their best option.

These are the very first steps for getting ready. We have prepared a guide, which can be downloaded here for a complete action plan.