Useful Life and Expectancy
It’s a situation that’s fairly common in residential property management. Move-out day arrives. The tenant has vacated the property, and as the landlord you’re ready to walk the unit and complete the move-out inspection. You open the door and stop, mouth open. It’s dirty. The carpet and paint are damaged, beyond useful life. You’re frustrated, but console yourself with the thought that the tenant is responsible for the damages.
Or are they? The answer may depend on how old the items were/are?
One fact that many first-time landlords forget is the rule of useful life when assessing a property. If an item has exceeded its useful life, odds are you won’t be able to hold the tenant responsible for the repairs. In fact, many courts will rule in favor of the tenant in similar situations. If that happens, you’re out the cost of the repairs and potentially triple the amount you charged the tenant for wrongfully withholding from their deposit. This is where hiring the right property manager proves it’s worth. So what exactly is useful life? It’s exactly what it says in a dictionary: “the amount of time during which an item is considered good enough to use.” Every item in a home has a useful life expectancy. Carpet, paint and appliances all wear down over time with normal usage. And with a rental property, the standard number of years can be different given the increased number of occupants coming and going. This means that if an item exceeds its useful life expectancy, charging the tenant for the repairs may not be an option.
So what is the best course of action for landlords?…Routine property inspections are #1 on the list. Monitoring the condition of your rental property on a regular basis helps catch potential problems ahead of time and thus creates a timeline for how items are wearing down. Keep track of when you last replaced certain items and make a schedule for when those items need to be replaced based on useful life expectancy. A rental is an investment, which means you have to continue to put money into it to get a good return. And last, hiring a property management company like RPM Midwest,.
Real Property Management is the regions only full service, full time professional property manager. RPM has quality people and systems in place with years of experience, success and resources to expertly manage your investment property. Guiding you to financial success!
Matt’s an Ohio licensed Realtor with 20+ years in residential and investment sales, leasing and property management. Matt offers pre-purchase consultations and BPO’s for investors, lending institutions and individual lenders. Matt splits his time evenly between Sales Manager and resident SuperHero at Real Property Management. Contact Matt via Bat-Signal by night or during the day at 866.500.6200 – [email protected] IG @CincySalesGuy – @ColumbusRealPropertyMGT – @RealPropertManagementMidwest