Managing rental properties can get pretty messy. Real estate investing is still one of my very favorite topics, but property will be damaged and utilities will be overused no matter how well you screen your tenants. This is why it’s essential that you have the right protocols in place.
After years of real estate experience, I developed the following five protocols. If you follow these simple guidelines from the very beginning, my hope is that you won’t have to learn the hard way.
Whether you’re doubling as a landlord or are at the point when you can hire one, make sure these five protocols are clear.
Five Essential Landlord Guidelines
1. Inspect all of your properties every month.
Let your tenants know in writing that you will be entering their home monthly. Also, have them sign a permission slip that you can and will inspect filters and heating/cooling units on a specific day of the month between 8 a.m. and 5 p.m.
If you have hired a landlord, ask them to provide you with a property inspection report each month. Grab one for free at the end of this post!
2. Do credit & criminal checks on all tenants.
This may cost you more money up front, but will save you plenty of headaches down the road. Have standards for your renters, such as a specific credit score they need to be above in order to live in your rental property.
3. Charge for any & all tenant damages.
Any tenant damages should become part of the rent due. If the fine is not paid then the rent is not paid. This means that the tenant can be evicted.
In order to be clear with your renters, provide them with a “Damage Costs List” when they sign the Rental Agreement. You’ll find more about damage costs in a minute.
4. Implement an Excessive Utility Policy.
Anytime the tenant’s usage of a provided utility becomes excessive and exceeds a specific dollar amount per month, the tenant is responsible for payment above this amount. Like a tenant damage fee, the fine will be considered additional rent due. Again, if the tenant doesn’t pay the fine, then they also have not paid their rent.
5. Have management report rent shortages or additional expenses.
If you hire a landlord, have him or her provide a written explanation with management reporting when there are rent shortages or additional expenses. The word written is the key!
I mentioned the Damage Costs list above. This list should be provided at move-in and move-out so you are aware of the cost of property damage, and so you can avoid these expenses. It should be understood by your tenant that any damages resulting from his or her neglect, abuse, or fault become rent due.
Here are some damage price-points to get you started…
Damage Costs List
Cleaning (any cleaning not provided by you at move-in/move-out)
- Refrigerator $35
- Stove top or oven $25-$50
- Kitchen cabinet or countertop $20
- Kitchen or bathroom floor $30
- Bathtub/shower $25
- Toilet $25
- Carpet cleaning or deodorizing $100-$150
- Extensive cleaning $75 per hour
- Remove crayon marks $25
- Small/large nail hole repair $10-$35
- Replace interior/exterior door $150-$250
- Replace sliding glass door $200
- Replace faucets $50
- Replace bathroom mirror or cabinet $50-$75
- Replace shower heads $15
- Replace toilet $175
- Replace garbage disposal $100
- Replace countertop $250-$450
- Repair window pane $75-$150
- Replace blinds $75
- Replace tile/linoleum $300-$450
- Replace light bulb $1.50
- Light fixture globe $15
- Light fixture $50
- Electrical outlet/switch $5
- Electrical cover plate $2
- Replace key $2
- Replace shower curtain $10
- Replace refrigerator shelve $25
- Replace oven knob $8
- Replace window screen $25
- Replace door lock $25
- Replace curtain rod or towel bars $20
- Replace smoke detector $40
- Remove junk and debris $75
- Fumigate for fleas $150
- Replace fire extinguisher $40
- Replace thermostat $75
- Remove wallpaper $150
- Repaint wall $25
- Vacuum entire unit $50
- Clear drain stoppage $75
- Fence replacement $25 per foot
The resident agrees that subject to the conditions above, his or her deposit will be refunded in full within a set number of days after vacating the premises. It’s also understood that the above amounts are minimum charges.
It is my hope that these five guidelines and the damage price-points will help you manage your properties effectively.
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