Is your investment property located in a quiet neighbourhood, hidden behind large fences or dense foliage, where no windows are visible from the street? It just might be the perfect location to run a drug lab. 

According to landlord insurance specialist Terri Scheer Insurance, illegal drug manufacturing rings deliberately target residential properties, known for their greater privacy, to run their operations. 

Terri Scheer Insurance Manager Carolyn Majda said that Illicit drugs such as cannabis, methamphetamine, ecstasy and GHB can be secretly manufactured in clandestine drug laboratories and that rental properties are perfect locations to do this. 

A record 694 clandestine laboratories were detected in Australia in 2009–10, according to a report by the Australian Crime Commission, 70% of which were detected in residential areas. 

Majda said that this is proof of the considerable danger that drug manufacturing rings pose to property owners. 

“Tenants involved in illicit drug manufacture can go to great lengths to hide such activities from the landlord and may abscond before their lease is up for renewal, so they can be difficult to detect if you do not know what to look out for,” she said. 

She added that property investors could help identify the presence of drug laboratories at rental properties by following these tips: 

Conduct regular property inspections

Majda said regular property inspections could help landlords to identify if and when any damage to a property had occurred, assist landlords to lodge insurance claims as soon as possible and potentially mitigate loss. 

“It takes three months to cultivate a hydroponics crop, so conducting quarterly property inspections will increase the chances of detecting any illegal activity as soon as possible,” she said. 

“While conducting inspections, look out for signs that the property is being lived in. Illegal drug manufacturers generally do not live at the properties they use to cultivate crops. 

“Intense lights used in hydroponics can visibly fade paintwork, so look behind hanging pictures for signs of colour variations on walls.

“Chemical waste is commonly disposed of down the drain, so ensure there are no blockages in the plumbing system and that the pipes are in good working order.

“There may also be cause for concern if a tenant who is present at the property at the time of the inspection restricts you from entering specific rooms.” 

• Look out for unusual items

“Certain items are commonly used to manufacture illegal drugs, including glass flasks, beakers, rubber tubing, gas cylinders, chemical containers, drums, drain cleaner, acid, garden fertiliser and cough, cold or allergy medicine,” Majda said.

“Portable air conditioners are also often used when cultivating hydroponic crops. 

“If such items are present at the property and appear inconsistent with practical use, it may indicate the presence of a drug laboratory.” 

• Pay attention to the smell

Majda said landlords should pay attention to strong, unpleasant or chemical odours in unexpected places. 

“Drug manufacturing can cause fumes, vapour and excessive heat to escape from windows and ventilators,” she said. 

Modifications to the property

“It is a good idea to check whether the meter board has been tampered with or rewired, and whether there are holes in nearby walls or built-in cupboards that could have been used to directly feed wires to the power source. 

“Look for holes in the ceiling as they could also lead to hydroponic systems. Try pulling up the carpet – if it comes away from the floor easily, it may have been removed to prevent staining in the drug manufacturing process and re-laid prior to inspection. 

“Windows that are constantly covered or sealed during the day and night, and rooms that are covered in alfoil are also common signs that drugs may have been manufactured at the property.”