PROPERTY UPKEEP – PAY CHEAP, PAY TWICE

People spend money on their health – with Gym Memberships, Fitness Classes, Food and Nutrition, Supplements and everything else that comes with maintaining your health. People spend money on there car – servicing, cleaning, petrol, oil, new tyres But when it comes to spending money on their home or office, where you spend the majority of your time and ultimately spend the majority of your money, a real estate asset is the most expensive purchase the majority of us will make, with that in mind it should be one of the items we take great care in ensuring it is well maintained and the property maintains the highest level of value that it can, additionally – a well maintained property is a healthy property for you and your family or work colleagues. As a property investor myself, I’ve been faced with the challenges of spending money on my home as a tenant and also as an owner, the decision is never easy but here are the rational steps I take when reviewing a purchase.

1. Is it required, and why – is there an underlying issue that is causing the repair that should be reviewed prior (Root Cause Analysis)
2. What are the options – repair, replace or upgrade
3. Once those options are selected then the selection process of the item – is there a warranty, is there reviews of the product, will it last 1 year or 5 years? Is there a longer term strategy (i.e renovation) so will conduct a small cheaper repair now and then upgrade later
4. Finally, the selection of the company that will conduct the work

This is the single biggest item you should look at, the quality and background of the team you have engaged to conduct the work for you. Experience and Expertise do not come cheap, even a simple job – conducted poorly – can cause issues. Let me give you a personal example. I moved into a newly construction townhouse, and although the quality is generally high, I would say 7/10. We had an issue, in 50% of the bathrooms the shower door has been incorrectly installed, the water escapes under the gap at the bottom. Instead of changing the doors and installing them correctly the landlord chose the cheap option. He installed a small ledge with a tile to prevent the gap at the bottom of the shower door. It isn’t a bad idea for a workaround, however it was installed at an angle which is still allowing the water to escape. To use my rational steps.

1. The root cause is the installation was incorrect on the original design – this should have been checked and rectified at source
2. The options were to replace (deemed too costly), upgrade (it’s brand new so won’t happen in this instance) or repair. The landlord chose repair
3. A cheap option was chosen to remedy an issue that wasn’t identifying the root cause
4. The company that “repaired” was the same contractor that installed it incorrectly in the first place!

The end result? 50% of the showers flood the bathrooms, this is going to cause an early decay and reduction in lifecycle of the materials used in the bathroom as 1 to 2 times a day it floods when using the shower, and all because the decision (and installing a ledge isn’t a bad idea, its a good idea if executed correctly) to use cheaper materials and cheaper contractors it has caused a $500,000 property to be seriously devalued. There is endless scenarios of these decisions being made. When it comes to your home, work with an expert, ask about there specific experience, ask about the team that will work on your project – what is there background? The brand name of a company doesn’t always mean you are getting the quality of person. Make smart decisions for your home and office, after all you wouldn’t put a low grade tyres on your car? or poor supplements in your diet? Because you know the consequences of that for your health and your vehicle. A property is no different. When looking at the cost of maintenance – you need to take into consideration the cost of not doing it correctly, follow the rational steps of decision making. Cheaper is not always better. You pay cheap, you pay twice!