One of the most common questions asked by landlords is if tenants can withhold rent. The answer is yes. In fact, withholding rent is a legal option for tenants in many states.
As with any landlord-tenant laws, landlords must be familiar with rent withholding and why tenants do it.
In this article, I give you a rundown of how to deal with tenants withholding rent.
Why Tenants Withhold Rent
Rent withholding is a common negotiation tactic used by tenants. Doing so prompts landlords to act on the tenants’ issues about the property, such as paying for the costs of repairs or deducting the amount from the rent.
In short, rent withholding means refusing to pay rent until the landlord corrects the issue.
State laws on withholding rent are generally tenant-friendly, but tenants cannot just opt to withhold rent whenever they want.
The grounds must be reasonable, and they have to comply with three basic things for it to be a valid withholding: the notice requirement, the grace period, and the manner of withholding.
A Landlord’s Guide to Rent Withholding
Any landlord should take rent withholding seriously. Not only does this ensure you take care of your tenants, but it also certifies that you abide by the state laws.
You shouldn’t take violations or liabilities lightly, as some can be reasons for you to get sued or have to pay up to triple in damages.
You should also consult a professional who is well-versed in the grounds and processes involved with withholding rent, such as a property manager who has been in the business with a considerable amount of experience.
In the event that your tenant withholds rent, and you have to go to court, you can prove that you did everything right from your side. Here are some major points to remember.
Rent withheld must be in either court or escrow
Just because they choose to withhold their rent does not meet they get to keep the money to themselves. Some states require withheld rent payments to be made to the local court.
But in my home state of Massachusetts, the rule is to put the rent withheld in an escrow account.
If the tenant withholds 500 dollars, they have to take that rent and put it into a separate escrow account for safekeeping until their landlord corrects the issue.
When the problem is resolved, they have to pay the money from the escrow account to the landlord. Technically, they can’t withhold rent if they do not do it.
Reason to withhold must fall under habitability issues
Tenants can’t withhold rent simply because they don’t like their landlord. They also just couldn’t claim they are not happy with your property: they must specify the issue making them unhappy with it.
State laws include health and safety standards, often referred to as a “warranty of habitability.” Warranties are responsibilities usually divided between landlords and tenants and specified in the lease agreement.
These are the common warranties of habitability that a landlord must provide to guarantee that their property will be a safe, sanitary, and livable home for tenants:
I have been in the real estate industry for over 20 years, managing 800+ properties. As your Landlord Tutor, I can guide you through landlord-tenant laws and concerns.
If you or anyone else you know is looking where to learn how to deal with issues like tenants withholding rent, join the Landlord Tutor community and sign up here.
Bathrooms are the most common area for mold to start. Once it does, it can be difficult to get rid of. Here are some Landlord Tutor tips to prevent bathroom mold.
An Introduction to Bathroom Mold
Bathrooms are so prone to mold because mold grows best in a moist environment that is filled with organic material such as dust, dirt, water damage, etc. Showers and baths can also cause the bathroom to get wet pretty quickly as it is a small, enclosed place.
Getting them to dry can be difficult, even if you have a window in your bathroom. Residents would not want to open it up, especially with the New England weather that would have them freezing if they kept that window open.
Tips to Prevent Bathroom Mold
Mold growth does occur over time, and could be a safety issue in the long run. Removing it can be expensive and difficult to solve, so the best thing to do is prevent them. Here are two tips you can use to prevent bathroom mold.
1) Install fans in your bathroom.
We install bathroom fans, the type that has to be vented outside. We don’t recommend installing the fan on the ceiling as there is only a little bit of space between the ceiling and the joist. You have to vent it all the way up.
To ensure that we vent out the air properly to the outside, we drill through the walls. That is not always possible in every building–such as those made with brick– but any good property manager should be able to make it work.
We also coordinate with our electrician to make sure that the power is there and that your residents can easily turn the fan on and off. We also look out for any gaps or holes so that rodents or pests will not get in.
2) Use IAQ paint.
Some condo associations won’t let you install fans in your bathroom. So what we do instead is use a special paint referred to as IAQ (Indoor Air Quality). Aside from having a wide range of colors to choose from, this kind of paint is mold resistant.
At the end of the day, landlords must prevent molds on their property so that residents don’t get sick or sue. Self-managing is also an option, but most probably you don’t have the right equipment, experience, or knowledge base to resolve it.
It would be best to entrust property issues such as bathroom mold to professionals, for your safety and that of your residents.
The Landlord Tutor Promise
Among his many licenses and affiliations, Jarrett Lau is a mold remediator. If you or anyone else you know is looking where to learn how to prevent and resolve issues like bathroom mold, join the Landlord Tutorcommunity and sign up here.
If you’re looking to hire a property manager, you may be wondering what questions to ask when hiring them. I have been a property manager for over 15 years, helping hundreds of other people manage their properties. I always suggest hiring a property manager but that doesn’t mean you need to.
Many times, if you have only one or two properties, you might be able to manage them yourself. However, there reaches a time when you either own too many or frankly, you might just not want to deal with the headaches of it. You want to enjoy the fruits of owning investment properties such as taking vacations and never have to worry about emergencies.
Here are the top nine questions to ask when hiring a property manager, which we categorized under the five major aspects of any real estate business.
On Management
1) How long have they been in business?
It’s important because if you have someone who is just doing it as a hobby or just started the business, they might not have any experience you need. They might offer the same price as other property managers who have been in the business longer.
2) What do they charge?
Is it a flat fee? Is it a percentage? Because if it is a percentage, their rate will go up as your rents go up, and if it’s a flat fee, it will stay the exact same, which they may or may not have a reason to increase your rent. Every good property manager should still increase your rent no matter what.
On Finances
3) How do they handle the financials?
Do they help you go through a budget versus actuals? Can they help you try to figure out what expenses you should be paying for and then help you analyze those every single year to determine if you were under or over that so you can proactively solve issues and problems?
On Proactiveness and Maintenance
4) What are they doing when it comes to solving problems?
How are they responding to them? How can they show you that they are being accountable or do they track their emails or they tracked their phone calls? Even when it comes to late-night maintenance, is it just an answering service? For example, in my property management company, we have emails and texts that we can show every step along the way of any emergency call.
5) How do they prevent problems?
We put emphasis on not having to solve problems but avoiding them in the first place. We are very proactive. In addition to doing things like newsletters and typical communication all throughout, we always set a time during the year to sit down and go through each person’s property.
On Communication
6) How do they contact you?
In case of emergencies or updates, how will you be notified? Will it be by email, phone, text message, or all of the above? Communication is a really important thing when it comes to any type of relationship. You want to make sure that you are very clear on how you expect to be communicated, and when.
On Rent Collection and Evictions
7) How do they collect the rent and when do they pay you?
Can they collect the rent when there are tenants that don’t have bank accounts, such as certain minorities? That might be a situation that you run into in the future depending upon where you are at.
8) What is their process for non-collection?
Do they actually go through the eviction process? Or do they just kind of talk to people and kick them out down the road? They should have a system set in place to deal with uncollected rent and abide by state laws on evictions.
9) Do they have attorneys?
Do they have a legal team to review all their paperwork and make sure it’s super airtight, or do they just use a standard form lease that they put together, maybe add into them through the years of what they have experienced?
In conclusion
The saying goes, you get what you pay for, so don’t be penny wise and pound foolish when picking a property manager. Make sure that they have a track record, and that they have experience dealing with the type of property that you have. More importantly, make sure to have a good working relationship with them.
If you don’t feel good about them, that is going to be something that you should be concerned about. At the end of the day, they are responsible for the most important and valuable asset that you have, and hiring a property manager is something that needs a high level of trust.
The Landlord Tutor Promise
Knowing what questions to ask when hiring a property manager can be difficult for new or aspiring landlords. If you or anyone else you know is looking to continue your education of being a landlord, join the Landlord Tutor community and sign up here.
