For property investors, one of the biggest risks isn’t always the property market.
Sometimes, it’s the person you hand the keys to.
A recent incident in Melbourne’s south-east is a sobering reminder of just how quickly things can go wrong. Police were called to a Cranbourne property after a party involving up to 80 teenagers reportedly spiralled out of control. The recently renovated home was extensively damaged, with reports of smashed windows, damage throughout the property and items allegedly being stolen. It was reported that the organisers had used fake identification to rent the property. Police investigations are ongoing.
For an investor, a story like this is difficult to ignore.
While this was a short-term rental situation rather than a conventional residential tenancy, it highlights a broader issue every property owner should think about: How well do you really know the person who is being given access to your property? Vandalism, unauthorised occupants, property misuse, unpaid rent and illegal activity can turn what should be a reliable investment into an expensive and stressful problem.
The good news is that investors can take practical steps to reduce these risks.
Here are five strategies every Victorian property investor should consider.
1. Make Sure You Have the Right Landlord Insurance
Insurance should be your first line of financial protection.
Even with careful tenant selection and professional management, no screening process can eliminate every possible risk. Unexpected damage, certain types of loss and other incidents can occur during a tenancy.
That is why investors should make sure their landlord insurance is appropriate for their particular property and circumstances. Don’t simply assume that your standard home and contents policy provides everything you need for an investment property.
Before leasing your property, review your policy carefully and understand:
- What types of tenant-related damage are covered
- Whether malicious or intentional damage is covered
- What happens if rent is not paid
- Whether legal expenses are covered
- What exclusions apply
- What excess you may need to pay
- What evidence or documentation the insurer may require when making a claim
It is also worth remembering that insurance is a safety net, ot a substitute for good property management. The goal should be to prevent problems wherever possible and have appropriate insurance protection when prevention isn’t enough.
2. Choose a Property Management Company That Takes Tenant Screening Seriously
Your property manager plays an important role in reducing tenant-related risk.
A property may be beautifully renovated, in a great location and advertised at the right price. But ultimately, someone will be living in it — and the quality of the tenancy can have a significant impact on your investment.
This is why investors should ask prospective property managers exactly how they assess rental applications.
A strong screening process should involve carefully assessing the information that can lawfully be requested under Victoria’s rental laws, including an applicant’s identity, rental history and capacity to pay rent. Since 31 March 2026, Victorian rental providers and agents must use the prescribed rental application form and can only request information permitted under the new rules.
This makes it even more important to work with a property manager who understands the rules and has a consistent, thorough process.
Investors should ask:
How do you verify the information provided by applicants?
How do you assess rental history and references?
How do you identify inconsistencies in an application?
What process do you follow before recommending an applicant?
The objective isn’t to find a “perfect” tenant — no screening process can guarantee that. The objective is to make a careful, evidence-based decision rather than simply accepting the first applicant who looks suitable.
3. Prioritise the Quality of the Applicant Over the Highest Rent
It can be tempting to focus on one number when leasing an investment property: “How much rent can I get?” But the highest weekly rent does not necessarily mean the highest return.
Imagine two applicants are interested in your property. One is offering slightly more rent but raises questions that require further investigation. The other is offering the advertised rent and presents a stronger overall application with a solid rental history and reliable supporting information. For an investor, accepting the second applicant may ultimately be the better financial decision.
Why?
Because the cost of a problematic tenancy can far exceed the additional rent earned. Think about the potential cost of:
- Property damage
- Extended vacancy
- Cleaning
- Repairs
- Disputes
- Legal costs
- Lost rent
- Re-leasing the property
- Management time and stress
A small increase in weekly rent can quickly disappear if the tenancy becomes problematic. The right tenant at the right rent is often more valuable than the highest rent from the wrong tenant. And importantly, Victorian rental providers must make rental decisions in accordance with the law and cannot discriminate against applicants based on protected personal characteristics.
4. Make Sure Routine Inspections Are Actually Thorough
Finding a good tenant is only part of protecting your investment. You also need to know what is happening to your property after the tenant moves in. This is where routine inspections become particularly important. A routine inspection isn’t simply an opportunity to walk through the property and confirm that someone is living there. A thorough inspection should help identify:
- Damage that needs attention
- Poor maintenance
- Unauthorised alterations
- Signs of overcrowding or unauthorised occupants
- Changes in the property’s condition
- Maintenance issues before they become expensive
- Potential breaches of the rental agreement
- Areas that may require further investigation
Just as importantly, inspections should be properly documented. Photos provide a valuable record of the property’s condition at a particular point in time and can help establish a clear history of the asset.
For investors, this creates an important distinction: An inspection is only as valuable as the quality of the inspection and the evidence it produces. A quick walk-through with a handful of generic photographs isn’t the same as a detailed inspection report that documents the condition of the property room by room.
5. Keep Detailed Records From Day One
When something goes wrong with a rental property, documentation matters. The strongest position for an investor is one where there is a clear record of:
- The property’s condition before the tenancy
- The condition at subsequent inspections
- Maintenance issues reported during the tenancy
- Communications with the renter
- Repairs completed
- Relevant notices and tenancy documents
- Photographic evidence of changes to the property’s condition
This is particularly important when dealing with property damage or disputes. A detailed photographic record can help establish what the property looked like before an issue occurred and what changed afterwards. It also gives the property manager and owner a much clearer picture of the property’s condition over time.
For this reason, investors should ask prospective property managers not just “Do you conduct inspections?”, but: “How detailed are your inspection reports?”
Protecting Your Investment Starts Before the Tenant Moves In
The Cranbourne incident is an extreme example, but the lesson for property investors is broader than one party or one property. You cannot eliminate every risk associated with owning an investment property. But you can build layers of protection around your asset.
That means:
1. Have appropriate landlord insurance.
2. Work with a property manager who takes applicant screening seriously.
3. Choose the quality of the tenancy over chasing the highest possible rent.
4. Make sure routine inspections are thorough and properly conducted.
5. Maintain detailed records and photographic evidence throughout the tenancy.
The common thread is simple: Don’t wait for something to go wrong before you start protecting your property.
Why Investors Choose RENTED Property Management
At RENTED Property Management, we believe property management is about much more than collecting rent and organising repairs. It’s about protecting the asset our clients have worked hard to build. That’s why we take a strict and thorough approach to applicant screening. We carefully assess applications using the information and processes permitted under Victorian rental legislation, rather than treating tenant selection as a race to fill a vacancy.
We also take inspections seriously.
Our inspection reports are highly detailed, with an average of around 200 photos per inspection, giving our property owners a comprehensive visual record of their investment property. That level of documentation means our owners can see what is happening inside their property — not just receive a brief summary saying everything is “fine”. Because when you’re trusting someone with an investment worth hundreds of thousands of dollars, details matter.
A good property manager doesn’t simply find someone to rent your property. They help you reduce risk, protect your asset and manage your investment for the long term.
Talk to RENTED Property Management about managing your Victorian investment property.
