Signs you need a better property manager

Pattern of deadbeat tenants suggests breakdown in screening, enforcement

By Inman News Feed
Add Comment Add Comment | Comments: 0 | Posted Dec. 1, 2011

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Pattern of deadbeat tenants suggests breakdown in screening, enforcement

Robert Griswold
Inman News™

Q: I own a rental property managed by a property management company. I have had problems with the last and current tenants. The previous tenant stopped paying rent for several months and then abandoned the property leaving it in unbelievable shape.

The house had to have considerable work done in order to rerent it. My current tenant is not paying the garbage service bill despite a number of promises to my property manager that they will do so. Some late rental payments also raise my concern.

I have asked the property management to please visit and inspect the home to be sure it is being taken care of, as I don't want to find myself in the same situation as before. The property manager advised me it is not allowed to visit the home except on a yearly basis to check the smoke alarms.

I can appreciate why tenants need to have rights regarding landlords wanting to inspect their property excessively, but this seems ridiculous. How can a landlord know there is no reason for concern in order to take action if he -- or through a property manager -- cannot inspect the rental home?

A: The ownership of rental property certainly has some risks. Even the best property management companies can have a tenant who suddenly stops paying rent and leaves the rental property in deplorable condition.

However, you seem to be experiencing a pattern that could very well be the result of poor prospective tenant screening as well as lax property management practices.

With your former tenant, your property management company should have immediately served the required legal notice as soon as the rent was late. If that notice expired and full payment hadn't been received or at least partial payments made based on a written payment plan, then a legal action seeking possession of the rental unit should have been filed.

While the length of time required to regain possession of the rental unit can vary by jurisdiction, and tenants may seek to delay an eviction, it is unusual for a tenant to owe more than two months' rent. Your current tenant is beginning to exhibit the typical warning signs of a future deadbeat tenant with the nonpayment of the garbage service bill.

The fact that the management company is satisfied with receiving a number of promises from the tenant to pay the bill is an indication that the management company is too lenient. A more aggressive but proper response would be to escalate the expectations with the tenant.

The first month that the garbage service bill is not paid should warrant a verbal reminder. The second time the warning should be in writing. The third time should also be in writing but indicate that the garbage service bill had been paid out of the security deposit.

I would also question whether the security deposit was the proper amount. Requiring a much larger security deposit has several benefits. First, many marginally qualified tenants will self-select out of the prospective tenant-screening process.

Second, the fact that the tenant will want to have this larger security deposit back when the tenant moves will motivate the tenant to leave the property in much better condition than if the tenant had a very small security deposit.

Finally, if the tenant does leave the rental property in deplorable condition as you described after your first tenant vacated, then you will have the ability to make more of the repairs at the tenant's expense -- and not yours. Overall, I think you need to re-evaluate your current property management company, as it is not protecting your interests.

Q: I live in a small apartment building and I am a smoker. I usually smoke outside of my rental unit in the entry area or on my private patio. I try to be considerate, but my neighbor is complaining to the on-site manager about my smoking.

My lease is up for renewal soon and the on-site manager said she would renew it. The on-site manager is a heavy smoker and we specifically discussed that I have a right to smoke in my apartment. I have this confirmed in an email; however, my complaining neighbor has told me that she has contacted the property owner and the owner is not a smoker and is planning to convert the property to a nonsmoking property in the near future. So I am concerned that the property owner might override the on-site manager.

To alleviate my fears that I will be in the middle of a lease and the property owner will implement a new nonsmoking policy, I was wondering if my new lease can contain a special clause for me and not the other smokers? Also, can she elect not to renew my lease, while the leases of other smokers are being renewed?

A: Personally, I think that nonsmoking policies at rental properties are becoming more widespread and actually make a lot of sense from the perspective of property owners in lowering their costs of turning over rental units and even lower insurance premiums in some cases. I encourage property owners to consider implementing those policies for some or all of their rental units.

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