Housing Hub University - HOW TO BE A GREAT LANDLORD #7

Although doing a walk-through with a tenant at move out may seem like the proper thing to do, it has many pitfalls.

Most tenants, at move out, are looking for reassurances that they've done everything correctly and will be having their security deposit returned.

There are plenty of problems that may not be seen on a quick walk-through with the tenant that will be found by by your cleaning/maintenance staff when they go through the property.

A property manager's responsibility is to the owner the manager has a duty to protect the interests of the owner by not making errors in judgement, such as committing to a tenant that the property is "OK."

Landlords, as a business class, are sued more than any other type of defendant in small claims courts in America. Most of these lawsuits are about deposits and deductions that were made after move-out. Knowing that, a prudent landlord will always operate from a careful defensive position, remaining fair to the tenant, but not accommodating risky requests such as personal move-out walk-throughs.

The best defense against lawsuits is a well documented accounting of what the specific deductions were and why the deductions were fair and justifiable. The best way to end up with that type of documented paper trail, which can easily be handed to a judge as evidence, is to employ a consistent and static turnover process that removes as many variables as possible.

The worst situation a landlord can get into is a “He said, She said” type of dispute, where the landlord is placed in a position of having to refute things that in fact were never said, or that are being mischaracterized by the tenant.

And, finally, the best way to avoid “He said, She said” debates, is to simply not say anything in the first place. Instead, reduce all communications to documented written steps and stages so that when (not if) you do end up in court someday with a tenant, you have a nice packet of printed and easy to understand paper trail evidence that represents all communication that took place.

The turnover process begins at the moment written notice to vacate is received from or provided to a tenant. Upon receiving a move-out notice, mail the tenant a set of instructions documenting everything they need to know and do in order to have a successful departure and deposit refund. This sets expectations and clarifies for the tenant what was agreed to in the lease agreement and the process that will be followed.

After the tenant’s departure, conduct a walk through check out the property. Only after a thorough evaluation of the property can a final assessment be made as to whether or not tenant damages exist that will be charged to the tenant deposit.

You control the process, not the tenant. Don’t have casual conversations about the deposit or condition of the property. Don’t attend a final walk-through. The tenant is free to take hundreds of digital photos, videotape, etc. if they want to document the final condition. In fact, it is a good idea to ask them to do so at move-in and move-out, and request that they forward the pictures to you.

You don’t need to be there. Keep everything in writing, stick to the process and don’t subject yourself to exposure or risk that your state's property code does not require of you.

Finally, be fair with the deposit, don’t be greedy or heavy handed. Be firm but fair. Remember you might end up in court defending yourself, and judges do give the benefit of doubt to tenants. Try to avoid going to court over something that could have been avoided.

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