This is a topic that I feel very passionate about…simply because there is a lot of misinformation out there and landlords have no idea how much risk they may be in!
Smoke Alarms background
For anyone that is not aware, the NSW State Smoke Alarm legislation came into effect on the 1st of May 2006 due to a string of fatal house fires at the time. Simply explained, it states that “smoke alarms must be installed in all buildings in NSW where people sleep”. This is because according to stats obtained from the NSW Fire Brigade website (https://www.fire.nsw.gov.au/), the risk of a fatality in a residential premises fire, is halved if there is a working smoke alarm! That’s right, halved!
The risk of fatality in a fire is halved if there is a working smoke alarm.
On rented properties, ultimate responsibility for ensuring that smoke alarms are installed and maintained, lies with the owners. The 2019 NSW Residential Tenancy Amendments, introduced mandatory annual inspections for landlords, in essence highlighting how serious the state takes smoke alarm compliance for landlords. That’s not to say that property managers bear no responsibility, but at the end of the day, and this is important to remember, the tenancy agreement is always between the landlord and the tenant…
Ultimate responsibility for ensuring a safe environment for the tenant belongs to the owner, and that is a responsibility that will never be completely outsourced!
If that obligation is therefore neglected and there is a fire, in addition to any loss of life, the owner could be facing negligence claims and potential litigation. Nothing you or I didn’t already there but I must admit… I never really appreciated the enormity of my responsibilities as a landlord, or perhaps better… I never really appreciated the risk I was in should a fire have occured. And to be brutally honest, I am blaming my property managers at various times for that and let me tell you why….
When I look back in all my years as a landlord, I generally had 3 types of exposure to the whole smoke alarm compliance requirement through my property managers…
- First it was the property managers that followed the “do nothing” approach! In other words… just let it be! I assume that their thinking was that by putting the responsibility back onto the tenants to change the battery and test the smoke alarm for themselves every now and then, everyone was “covered”. Except, not all smoke alarms are compliant, tenants would never test them and there have been examples of tenants who have sued owners and property managers for failure to maintain smoke alarms!
- Then there were the property managers that tried to put the “responsibility back onto me”, the landlord. They did that by sending me, at random times, a random authorisation form, with a couple of tick boxes to either opt in [to their very expensive service], or to opt out, and return by mail! No other explanation… just that! So of course my first reaction was always to ignore it as, because of my “do nothing” property managers, I always assumed that this cost was optional… and an expense that I didn’t need!
- And then there were those that did the “right thing” and went and authorised a compliance inspection without me knowing about it (or maybe I did authorise it and didn’t remember doing so). Having never really appreciated the exposure to legal and insurance issues, all I saw was yet another expense on my statement at some random time of the year…. (which for some reason most of the times fell on the same month as the strata and council bills going out), and I was never happy with it!
Now I don’t want to be harsh on property managers… maybe they didn’t understand the risks themselves, or maybe they were just too busy to sit me down and explain it to me, or maybe their agency didn’t really have established policies, procedures and systems about smoke alarms. Being in the industry myself now, I can tell you for a fact that being a property manager is by no means a walk in the park! It is hard, hard work managing issues everyday or chasing people to do things… And the more properties you manage, the more busy you are… but think about this scenario for a second…
You have a property that you bought for your retirement. You are proud of it and you are working hard to make sure you keep up the repayments by sacrificing other luxuries. The tenant is great. They look after your place and they always pay their rent on time.
And then a fire breaks out which spreads and damages 2 neighbouring properties… no one gets seriously hurt but there are several hundred thousand dollars worth of damages to property, personal belongings are lost and lots of people need to take time off work to sort themselves out. On top of that, you property remains vacant for weeks, maybe months whilst your mortgages are still running… Of course you hope your insurance will cover it all….
And then there is an investigation. It is very common in these scenarios for owners to be asked to provide documented evidence that the smoke alarms had been checked and that your property was fitted with compliant smoke alarms!
The reality is that unless you have a recently obtained report from a properly qualified professional, you have no protection and proof that your obligations were met!
And that almost certainly means that, knowing how insurances companies operate, the chances of you getting any money out them are zero! I can tell you from personal experience, the whole insurance industry gravitates towards loopholes that will get them out of paying up!
Can you afford that risk?
If there is a fire and you don’t have a recently obtained report from a properly qualified professional, as the owner you could be facing negligence claims and potential litigation!
My body corporate does annual checks. Am I covered or should I do my own tests?
This is an argument I hear often. Yes, at the time of writing this post, some – but not all – body corporates organise annual smoke alarm testing. Our experience with those is that they happen en mass, often a hit and miss if the tenant is not available (which happens regularly) and there is no formal response on conclusion to confirm that the property was inspected and it is indeed compliant. Unlike the Smoke Alarm compliance companies used by property managers, no compliance certificate is produced by the Body Corporate annual smoke alarm testing – which really is whats puts our minds to rest!
Whilst there is no certainty that the testing conducted by Body Corporates fulfils all requirements, we are satisfied and accept that Body Corporate Smoke Alarm Testing is sufficient, providing that the Body Corporate, Strata Manager or appointed Smoke Alarm Testing supplier can provide in writing answers to the following questions (which are required for the Entry Condition Report):-
- Have smoke alarms been installed in the residential premises in accordance with the Environmental Planning and Assessment Act 1979 (including any regulations made under that Act)?
- Have all the smoke alarms installed on the residential premises been checked and found to be in working order?
- Date last checked
- Have the removable batteries in all the smoke alarms been replaced within the last 12 months, except for removable lithium batteries?
- Date batteries were last changed:
- Have the batteries in all the smoke alarms that have a removable lithium battery been replaced in the period specified by the manufacturer of the smoke alarm?
- Date batteries were last changed
- Confirmation that they are able to repair alarms within 2 business days of tenant reporting an issue (including changing the battery).
The facts about Smoke Alarms and relative legislation in NSW
Below I have included some of the facts I found in my research and what is considered “best practice”. The list is not exhaustive, neither can I profess to be a trained professional. Besides, things move constantly and new technologies and legislation come in regularly, which is another reason to have a professional do this… but here it goes nevertheless.
- Regulations place the responsibility of smoke alarm compliance onto the property owner. The 2019 Residential Tenancy changes introduced the below very specific requirements:-
- Where a smoke alarm is not in working order, landlords and agents must ensure the alarm is repaired (this includes replacing a battery) within 2 business days.
- Landlords and agents must check smoke alarms every year to ensure they are working.
- Landlords and agents must also ensure:
- smoke alarms are replaced within 10 years of manufacture, or earlier if specified by the manufacturer
- batteries are installed or replaced every year (or for lithium batteries, in the period specified by the manufacturer).
- Landlords and agents must give at least 2 business days’ notice to inspect or assess the need for smoke alarm repair or replacement, and at least 1 hour notice to carry out repair or replacement of a smoke alarm.
- The smoke alarms must meet the requirements of Australian Standard AS 3786 (whatever that means – hence why you need a professional).
- Smoke alarms can be battery operated or connected into the power supply (240V). The battery operated smoke alarms must have their batteries replaced once a year.
- The smoke alarms siren must have the required decibel output of 85dBa (which sounds very loud).
- No one (landlord, tenant, tradesperson etc) is permitted to remove or interfere with the operation of a smoke alarm. That is ONE thing property managers can check.
- At least one working smoke alarm must be installed on every level of a property.
- Landlords (and property managers) will often undertake the task of putting a new battery on battery operated smoke alarms and test them by climbing on chairs – at the commencement of a tenancy. Whilst this sounds innocent enough, by doing this they run the risk of falling over and injuring themselves.
- Some property managers put the responsibility onto the tenants after the tenancy begins, by asking them to replace the battery on battery-operated smoke alarms. Again, see previous point about falling over and injuring yourself.
- The NSW Fire and Rescue department provides a Smoke Alarm and Battery Replacement Service for people over the age of 65 or people with disability who have no-one to assist them. It is free of charge!
- The entry and exit condition report section of the tenancy agreement must include a specific reference to smoke alarms so that tenants and landlords are able to note and comment on the presence of smoke alarms at the beginning and end of the tenancy.
- Each smoke alarm unit should be replaced at least once every 10 years (or earlier if specified by the manufacturer) – with new 10-year lithium powered smoke alarms.
- Owners of residential property who rent out their premises as holiday accommodation are responsible for installing smoke alarms and replacing batteries.
- The Environmental Planning and Assessment Regulation 2000 (NSW) state that smoke alarms must be installed on or near the ceiling in the following areas:
- in any storey containing bedrooms,
- in every corridor or hallway associated with a bedroom or,
- if there is no corridor or hallway, between the part of the home containing the bedroom and rest of the dwelling; and
- in any storey not containing bedrooms.
- The Building Code of Australia (Building Code of Australia Volume One 2015, Specification E2.2a Smoke Detection and Alarm Systems) requires smoke alarms to be installed in egress paths in any storey not containing bedrooms and that, where there is more than one alarm installed in a home, they should be interconnected.
- Smoke alarms should be installed in other storeys, even if those storeys consist of only car parking, bathrooms, laundries and the like.
Did you know all the above? I didn’t and to be honest, chances are I will probably forget the details by next week when I have moved on. The one thing I will never forget though is that smoke alarm compliance is not optional… so this is my promise to myself going forward…
I promise to
- Make sure that every property I manage, is always inspected once a year by a trained professional, and
- I promise to never again be unhappy when I see that $99 tax deductible fee on my next statement.
Who we are:
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NextGen Property Mgmt (www.nextgenpm.com.au) is a boutique Real Estate licensed agency that specialises in property management. NextGen Property Mgmt does NOT has a sales team unlike most other agencies that specialise in Sales and have Property Management as a side business.
Our area of focus is residential property and we operate in Inner and South West Sydney, as well as St George.
NextGen was created from its infancy to cater for investors as it was founded by investors who quickly realised that in a highly regulated industry like Real Estate – competence, expertise, care and service by property managers varies greatly.
As an investor, you need to have trust for and feel valued by your property manager. You need to know that your property is being looked after with minimal disruption and you are getting maximum return for your investment. At NextGen we understand that because we are investors living busy lives ourselves, so our promise to you is that you will no longer have to worry about your most valued asset because we will make sure to take care of it as if it is our own.