Checking for meth before buying a house
The hot recent housing market has seen Kiwis buying and selling houses at some of the highest rates ever.
While the effects of FOMO (fear of missing out) may make it tempting to dive into the market, we’re here to remind potential home-owners the importance of due diligence before buying, particularly dealing with meth contamination.
We’re seeing signs of complacency creeping in, as people look to ‘hurry up’ the process, or start reaching for houses that aren’t in the best nick.
If you’re buying a rental property it’s essential you consider that it could be contaminated with meth.
The seller must disclose to potential buyers if there is contamination over 15 micrograms (μg) per 100 square centimetres of meth contamination. This is considered a material property defect.
However, the seller only needs to disclose contamination below 15μg per 100cm2 if they are specifically asked by the prospective buyer (or where the buyer has shown a clear interest in meth contamination).
Your first takeaway should be that if nothing is provided, simply ask the seller about meth contamination at the very least. This is an easy win.
No meth information provided by the seller?
Disclosure is only required if the seller knows about the contamination. In reality, people often don’t know their property is contaminated as there’s no legal requirement to keep testing your rental. Meth often flies under the radar, especially at lower levels.
Therefore you should always have some form of confirmation it isn’t contaminated. See first if anything is disclosed on the real estate listing (ask the agent!). If not, ask the seller if they suspect there could be any contamination (preferably in writing).
If neither can provide any confirmation, you should arrange a test yourself. You can easily do a composite test with a self-testing kit for less than $50. This won’t tell you the level of contamination – it’s simply to tell you whether meth is present or not. It will only put a small dent in your budget, and point out if a more expensive professional composite test is required to find the exact levels.
A swab test is well worth the money.
What if you buy a contaminated house unknowingly?
In short, you could be in for a cleaning bill in the tens of thousands. We paid out an average of $22,000 per meth claim in 2020.
Unfortunately we’ve seen more examples of people buying new houses, and quickly finding contamination. They then enquire about lodging a meth contamination claim.
It’s a painful conversation we never want to have, as in most cases it won’t be covered.
If there’s no record of the house being clean when purchased, insurance companies generally won’t pay for meth discovered within 90 days of your policy beginning. This is because they don’t know the culprit who is responsible, and chances are the contamination happend before the period of cover.
So please take a moment to enquire, ask, and test for meth where necessary before buying. It could save you thousands!
Initio are the pioneers of online house insurance in New Zealand.
- Learn more about our meth contamination cover
- When is meth testing required or recommended?
- Learn more about specialist landlord insurance cover