How Do You Maintain and Repair Your Rental?
1. Maintenance Strategies
We suggest creating a systematic approach to maintenance and repairs.
Once you have a new tenant:
Get everything ready before you start renting. The first step is to make a complete checklist to take inventory and ensure everything is in working order.
Welcome the tenant in. If you as the landlord are not willing to assume the responsibility for repair, specify the tenant's repair and maintenance responsibilities in the lease or rental agreement and point them out before they sign.
Teach new tenants how to handle routine maintenance. Explain basics such as how to avoid circuit overloads, how to properly handle garbage, and how to locate and use a fire extinguisher. Identify issues that tenants should never try to deal with, such as electrical maintenance. Include a short list of all these maintenance considerations in your onboarding materials.
Throughout the tenancy:
One of the best ways to make sure that your rental will be well maintained is to keep clear line of communication with your tenants so that they will report any problems they see that need your attention. In all communication between tenant and landlord, keeping a written record is better than having conversations over the phone.
Some landlords ask their tenants to go through a semi-annual or annual checklist to make sure everything is in working order. This list will ask tenants to identify any known problems with windows, heating system, locks, smoke detectors, elevators, stairways, garages, pools, roofs, and other items. You can make a form for this and give it to the tenant to fill out and return within a specified time period, such as a few weeks. Respond promptly to all requests in writing and keep copies in your files.
Respond quickly and efficiently. Deal with repairs (especially emergency repairs) as soon as possible, but within the time required by State law. If the maintenance period exceeds 48 hours (except weekends), the tenant should be informed by telephone and follow up in writing. For example, if you have a problem with scheduling the plumber, let the tenant know.
On a regular basis:
Use written reminders. Print your policy and procedures to let the tenant know it is important to keep the property in good repair. Telling the tenant that you are truly willing to help solve the problems will remind tenants to tell you about the maintenance and repairs needed.
Conduct an annual safety evaluation. Once a year, make time for a "safety and maintenance inspection," where you check that items such as smoke detectors, heating, plumbing systems, and major appliances are safe and in working order. The law doesn't require these checks, but it's a good idea. Be sure not to overdo it—once a year is enough.
2. Respond to Tenant Complaints
Communicate with tenants frequently, respond in a timely manner to all complaints and take immediate action. Obviously, different problems require different levels of action:
Personal security and safety problems. These situations are emergencies; you should respond immediately and address any issues that may cause injury or property damage.
Major inconveniences to the tenant. Respond and attempt to get the work done as soon as possible, within 24 hours if the problem is major (e.g. an electricity or heating problem). Otherwise, tenants may try to take matters into their own hands.
Minor problems. If the problem is minor, respond within 48 hours (on business days). This should be a sufficient amount of time to avoid tenant dissatisfaction.
While it’s important to keep up with major repairs, you must also respect your tenants’ right to privacy. Unless you have given them the appropriate notice according to your State laws or unless there is an emergency, you must never enter the property without the tenant’s consent. When giving notice for entry, try to choose a reasonable time of day to keep the peace (and potentially obey the law).
3. Handling problems over the phone
If you live far from your property and you haven't hired a property manager, you will face additional challenges when it comes to making repairs. There’s an extra level of coordination involved when a tenant contacts you for repairs and you need to ask them to make the appointment and send you the receipt. Some landlords choose to use Tellus to take advantage of free quotes, easy communication, and tenant reimbursement.
4. Hire a Property Manager
Hire a property manager. If you have a property manager, one of their duties is to supervise the maintenance work, especially since many property management companies have professional staff to deal with maintenance problems and have vetted many other professionals such as plumbers, electricians and general contractors.
Make sure the property manager will respond immediately. Ask for a commitment to a specific turnaround time. You do not want your property to become damaged or your tenant to become injured because the property manager was unprofessional.
Confirm that the property manager is available 24/7. This will avoid emergencies that may result in tenant injury and property damage.
Know what the property manager charges. Figure out if there is an extra charge for a service call. Some property management companies make money by charging administrative fees when they hire outside contractors or suppliers.
Specify if your approval is needed for repairs. Your contract should specify the extent to which repairs can be made without your consent. You want your property manager to be able to act quickly in an emergency, especially if you are not there. On the other hand, you do not want to give your manager the authority to make major or expensive repairs or replacements, such as replacing the furnace, without first consulting you.
Also, keep in mind that the property manager may not carry out annual inspections or ask the tenant if the house needs any repairs. This is something you’ll either have to do yourself, negotiate with the property management firm to include in your agreement, or pay extra money for the service.
5. Hire a Handyperson
You can communicate with other rental property owners or real estate professionals to find the right people for referrals, as well as friends and colleagues.
It is best to find someone with basic health insurance and liability insurance, which will protect you if the person is injured at work, causes any property damage, or injures others. A reputable employee will be willing to provide this certification. An insured handyperson may charge more than someone who is uninsured, but knowing that you or your insurance company won't end up paying for the consequences of an accident is worth the extra cost.
Also, in order to reduce your financial risk, make sure the person you hire has acted in accordance with any State rules and licensing requirements. In some states, for instance, you should not hire unlicensed contractors for certain kinds of work.
6. Hire a Contractor
You can use the following guidelines to help get a home project done right for a fair price:
Interview several contractors. First, ask other landlords, friends, neighbors, or your local landlords' associations to recommend companies or individuals that provide them with quality service. You should know which contractors work in a particular area, the quality of their work, and how much they charge.
Ask for references and check them. If your county or city has a permit program for home improvement contractors, do these contractors have a permit? Also, ask for a copy of their insurance and license. Contact the Better Business Bureau to research possible unresolved complaints.
Get cost estimates. Find out whether these are estimates or a firm bid. Often, especially on older homes, contractors don't make a firm offer because they can't possibly know what they'll find until they start working, and how hard it will be to get the job done. You should ask at least three contractors to bid for a home improvement project and provide them with the same job information. The more definite the specification, the more realistic the bid will be—and the less likely you or the contractor will have unexpected problems.
Ensure that each bid includes a work report and specifications describing all work to be completed and associated costs. Make sure the contractor specifies the type, brand and/or grade of material they plan to use so that you’ll know you received the quality you requested.
As a safeguard, especially for a larger job, make sure that the contract specifies the job description and payment period. Your contract may also include a dollar limitation to the amount you will pay the contractor. Your contract should also include start and finish dates, and possibly some remedial action if the contractor fails to meet the deadline.
If the scope of work is extensive, the contract should also include a schedule for paying the contractor. You should always keep a portion of the full payment, usually 30%, until the job is done.
Obtain answers to the following critical questions:
Does the job require building permits?
If so, who is responsible for obtaining them?
Will the work need to be inspected? By whom?
Is the contractor insured and bonded?
Also, request copies of the contractor’s liability insurance coverage, worker’s compensation, and if required in the area, licenses or certifications.
7. Hire the Tenant
You may want to give your tenant some responsibility for property management. This decision has both advanatages and drawbacks. On the plus side, tenants are aware of these issues and are very motivated to address them. On the negative side, since tenants are usually not interested in the long-term condition of the property, they may not care about the sustainable development of the property.
If you decide to hire the tenant for normal repair of your property, there are several factors to keep in mind. First, make sure the tenant has the necessary knowledge and experience, which may depend on both the task and the tenant. Second, make sure that hiring tenants is cost-effective. While it may be more convenient, it is not always cheaper. You won’t save money if you credit or pay the tenant hourly, but it takes them twice as long as a professional (or if they cause further damage).
In addition, take note of the following precautions:
The quality of the repair may be low. Unless your tenant just happens to be a skilled contractor, you risk the repairs being inadequate and may end up redoing them (or worse).
If the tenant is injured or injures another person, you are legally liable. Tenants who don't know what they're doing can easily cause injuries, especially when dealing with sensitive systems like heating or power lines. Hiring tenants mean you are responsible for these injuries—even if they happen later (for example, when a newly installed light fixture breaks down at a dinner party). Of course, you can recover your losses by suing your tenant (legally known as "seeking indemnity"), but unless your tenant has substantial assets, your chances of recovery will be slim. On the other hand, a maintenance or repair service usually has its own insurance (check this out before you use their services).
The law may not permit you to entrust major repairs to a tenant. Judges and lawmakers worry that it will be difficult, both operationally and financially, for tenants to be able to carry out the maintenance work normally required to bring the building up to par—and making the place livable is still your responsibility. A few states allow landlords and tenants of single-family homes to agree in writing that the tenant is required to meet some of the landlord's statutory obligations, but the landlord generally retains the obligations set out in the health and safety codes and the implied guarantee of habitability.
8. Compensating the Tenant for Repairs
If you decide to allow the tenant to make repairs from time to time, you have two choices for how to pay the tenant. You can:
Reduce the rent. This will probably be your tenant’s preference. Of course, you will want to agree to this practice ahead of time, agree to the payment terms, and lay out your agreement in writing within the rental agreement.
Pay directly for the work. Paying an on-site tenant to do repair and maintenance is preferable to giving the tenant a reduction in rent for work performed because if the job isn’t done right, you can simply cancel the work arrangement rather than amend the lease or rental agreement. Plus, there will be no question that the tenant is still obligated to pay the full rent as usual. If you choose this route, be sure to write down what you expect your tenant to do, and for how much money.
Repair and maintenance arrangements between landlords and tenants often cause dissatisfaction—the landlord thinks that the tenant has not done certain tasks, or the tenant thinks that they have too much work to do. Here is some advice for making things flow smoothly:
Put it in writing. Any agreement regarding repairs or maintenance of the property should be written and signed, either as part of the lease or rental agreement, or as a separate employment agreement. This will avoid misunderstandings about who’s responsible for what.
Provide enough details. This way, the tenant knows exactly what is expected. Whether it’s repairing a broken window, dealing with a routine plumbing problem, or landscaping, give clear and specific descriptions and limits to the tasks. Also, make sure the tenant is able to perform these tasks.
Pay fairly. If you do not, you will increase the tenant’s resentment, while decreasing motivation to get the job done. If you ever have a controversy with the tenant, a judge won’t look kindly on an unreasonably low payment for the tenant’s hard work, especially if it doesn’t even add up to minimum wage.
Keep these roles separate. Treat the delegation of duties separate from other duties as a landlord. For example, if you and your tenant agree that the tenant will do gardening work in exchange for a reduction in rent, and you’re watching the shrubs die or take over the sidewalk, you may not respond by shutting off the water or retaliating in other ways. The proper recourse is to discuss the problem with the tenant and, if it persists, to cancel the arrangement.