Being a landlord comes with plenty of responsibilities. Once you secure your investment properties, you’ll need to plan for a lot of things: upgrades, renovations, repairs, tenant communications, and more. In addition, you’ll also need to plan how you’ll manage your tenants’ needs and repairs and prepare yourself for the most common landlord-tenant disputes.
It’s a full-time job being a landlord, and unavoidable tenant issues can make your life hard. If you’re like most investors, you probably don’t want to deal with problematic tenants at all.
The easiest solution is to hire a property manager. When issues arise, they’ll handle everything for you. For instance, Green Residential serves investors in Houston with full-service packages that make their rental properties hands-off.
If you don’t like being a landlord, property management is the best solution to ensure your tenants are taken care of professionally.
Otherwise, you’ll need to familiarize yourself with common disputes between landlords and tenants. Sooner or later, you’ll encounter at least one and you’ll need to have the knowledge and skills to handle the problem.
1. Late rent
Most people have been late with rent at least once in their life. It’s common, and not usually a big deal. Sometimes people just need an extra few days to pay the rent because of their paycheck schedule.
The best way to handle late rent is to give a grace period of a few days before charging a late fee. Usually, three days is sufficient. On the fourth day, then you can charge a late fee.
Although most tenants will eventually pay their rent, some will hold back and only pay you partial rent. At this point, you’ll need to decide if it’s time to evict your tenant for non-payment.
2. Non-payment of rent
Late rent is one thing, but sometimes tenants won’t pay rent at all. Sometimes it’s due to a genuine financial problem, but there are also people who routinely move into properties and refuse to pay the rent until they get evicted just to get a couple months of free rent.
These people have been dubbed “professional tenants” and often get away with their crimes. One man from Toronto was able to skip out on rent for two years.
If a tenant hasn’t paid rent, don’t wait to find out why. If they give you an excuse that doesn’t sound right, be aware that they might have no intention of paying.
When you get a sad excuse, it’s tempting to give them a break, but if they can’t pay rent now, it’s hard to imagine they’ll ever be able to pay it back over time.
If you want to stay profitable, it’s better to evict a tenant who hasn’t paid rent. One month of unpaid rent will quickly turn into two, and then you’ll be out even more money by the time you pursue eviction.
3. Refusal to pay late fees
Nobody likes paying late fees, even when it’s just $25. People work hard for their money and don’t want to give it away for no reason. Even when they agree to pay late fees, many tenants still resist.
You might think it’s not worth pursuing late fees because they’re so small, but they aren’t designed to be profitable. They’re supposed to be a deterrent.
When a tenant knows they’ll be on the hook for a late fee, they have more incentive to pay rent on time.
Some tenants can’t help it, but others are late with the rent even when they have money they could borrow from savings. When there’s no financial consequence, they’d rather make their landlord wait.
Make sure your late fees aren’t too high and that they fall within all state and local limits. If a tenant can’t afford a late fee, don’t let them off the hook. Instead, let them make payments no matter how long it takes to pay in full.
4. Miscommunications
Miscommunications are the most common problem you’ll experience as a landlord. For example, sometimes tenants don’t remember agreeing to specific clauses in the lease.
Another common miscommunication happens when tenants think you’ve implied something when you haven’t, like letting them slide on late rent.
The best way to prevent miscommunications is to conduct official business in writing. If you give a verbal notice, follow up with a written notice.
Document everything, and don’t have conversations with tenants in a text message, as texting is especially prone to creating misunderstandings.
5. Minor lease violations
Most minor lease violations aren’t a big deal. For instance, a tenant might leave a trash bag outside their door for a day and forget to take it to the dumpster. This type of violation is easy to resolve through a simple conversation or notice taped to their door.
6. Turnover and empty units
Vacancies are inevitable, but you can rent your property faster by marketing to the right people, posting 3D virtual tours, and having professional photos taken. A little bit of effort will go a long way here.
7. Threats to file a lawsuit
It’s safe to say all experienced landlords have been threatened with a lawsuit at least once in their life. Many times, those threats come to fruition. You can’t avoid this, but you can avoid losing a lawsuit by making sure you do everything by the book.
Connect with an attorney who specializes in landlord-tenant law and get your lease agreements solidified. Make sure you understand the law to the letter so you don’t make any big mistakes that might cause you to lose a lawsuit should you get sued.
8. Pet and ESA disputes
Thanks to misinformation on the internet, a large number of people are convinced their emotional support animals (ESAs) have the same rights as service animals. Although there are some shared rights, they are not equal.
However, you’ll probably encounter a tenant who will fight you all the way on this matter. So, make sure you know the law thoroughly where emotional support animals, service animals, and pets are concerned.
Issues are part of investing
As with any business, property management is not issue-free. At best, you can avoid some and mitigate the damage from others. The key to making it through is to be prepared.
