“Why do I have to pay for that repair when the resident just moved out?” “Why aren’t they responsible for these repairs?”
These two questions are ones that we asked daily by current landlords. And to be honest, it really boils down to what the courts or even the judge on that given day what they will allow. As a management company, we are often caught between the landlord and the resident. Both parties feel they deserve the security deposit on damages, painting, and cleaning. Sometimes a compromise can’t be reached leading all parties in court before the judge, and then we are all the mercy of the judge’s decision which usually favors the resident
Our job as a management company is to keep you abreast of the changing laws about investment properties. Also, to share with you what we see when it comes to small claims court. What we see these days is that Judges are not tolerating “nickel and diming” residents. Meaning they are cracking down on the “smaller items” such as batteries, light bulbs, some cleaning, painting and such.
As the Law Reads
The categories listed below fall under the Tenant Landlord Law, and while there are a some “gotcha’s” when it comes to each category, for the most part, the court is clear about who pays for what.
- Carpet has a lifespan of 10 years and can be prorated if a resident destroys carpet before the lifespan is over.
- Paint has a lifespan of 2 years. If your resident lives in your property for two years, you are responsible for any painting that is needed. Less than two years and it will be prorated.
- Blinds have a lifespan of 4 years.
- AC Filters, Smoke Detector Batteries, Lightbulbs and the like, fall under the category of “doing business.”
- And then there is the normal wear and tear category which is very hard to determine.
Let’s break these categories down a bit and look a bit deeper.
The average lifespan of carpet is ten years and can vary depending on the quality of carpet used in the home. If you use the bottom of the barrel, cheap carpet, you may only get two to five years of life out it. By the way, more than likely you wouldn’t use cheap carpet in your home, so don’t use it in your investment property either. If you replaced the carpet when the resident moves in and they live in your home for five years, and the carpet needs to be replaced when they move out. You will be responsible for 50% of the carpet, and the resident is responsible for the other 50%.
The lifespan of paint is two years. I know it doesn’t seem like that long. However, this is, how most Judges view it. We recommend painting with good quality paint, like Vista or Sherwin Williams, and using a water-based semi-gloss so that any scuff marks can be wiped off easily.
If a resident paints the walls a custom color and fails to return them to the correct color before moving out, the resident is responsible for at least one if not two coats of paint (depending on the color), even if they lived in the home for more than two years.
Believe it or not, blinds have a lifespan as well, and it can vary slightly depending on the type and quality of the blinds. Another factor is sun damage. Blinds exposed to the hot sun day after day will break down sooner than those that are shaded for some or all day. The average lifespan for blinds is four years. Like the previous two categories, there is a proration to be done based on use and abuse. For example, blinds damaged by “reaching through” the blinds, will be responsible to the resident, however, if the blinds are older than four years old, the judge will say, owner responsibility.
Misc. Items or Smaller Items
As mentioned at the beginning of the article, the courts are really cracking down on the smaller items, such as light bulbs and smoke detector batteries. When we first started in property management residents would be responsible for making sure all light bulbs were working when they moved out or that the smoke detector batteries were working. Now Judges say, “how do you know the bulb didn’t burn out when you flipped the switch on” or the “battery didn’t just die.” In reality, we can’t prove that the resident didn’t change the battery before moving out or that the bulb didn’t just burn out. Therefore, as an investor, it comes down to the cost of doing business.
Abuse and Damage
There are instances where the resident damages the property. Their dog digs a hole in the back yard or chews the sprinkler line. Holes in the window screens that were replaced before they moved in, screens are missing from the windows, smoke detectors missing, all fall under resident damage. These scenarios are the responsibility of the resident and will come out of their security deposit.
At the end of the day
While it may not seem “fair” for the landlords to cover some of these repairs, it comes down to how the courts are ruling these days. We take a video of every room with audio narration, and we have done this since 1992, some 27 years ago to make the best possible assessment. This is why it is essential to consistently raise the rent moderately so you have money to pay for these repairs and improvements as long as the market will bear the increase. A $50 a month increase each year in 6 years puts over $12,600 in your pocket. So, we encourage Landlords when it’s time for lease renewals that you go with our suggestion with a small increase.
How to make sure you will have the money when you need it for repairs
I’ve written about this in other articles, but it’s worth mentioning again to set up a separate checking investment account so when rents increase one doesn’t squander the money away, innocently but nevertheless it will be gone if you allow your monthly rent to be deposited in your personal checking account. So open up a new checking account and call it investment checking this way as that $12,600 I spoke about will be there when you need it.