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Maintaining and Repairing Your Rental Home in Houston

Maintaining and Repairing Your Rental Home

One of the biggest headaches landlords face is the maintenance and repair of the home, and one of the biggest reasons tenants do not resign a lease is due to maintenance and repair problems that take too long to finish or are not repaired to their satisfaction. Maintenance and repair can be costly and time consuming, and tenants can get frustrated if they are inconvenienced for too long.

Are you a landlord the knowledge and skill to maintain and repair the property, or do you contract those jobs out? Even if you can do the repairs and maintenance yourself, should you? When is it a good time to just replace something instead or repairing it? What maintenance and repairs are you even responsible for? What is your tenant responsible for? How much should maintenance and repair cost for your home? Can security deposits be used for these costs? The answers to these questions depends on several factors. Here are some tips to help you make these decisions.

 

What are the landlord’s maintenance and repair responsibilities versus the tenant’s rights and responsibilities?

Maintenance and repairs of the structure of the house (faucets and painting), the lawn (sprinkler systems and insects such as bee hives and termites), and any appliances the landlord owns (refrigerator, dishwasher, and AC units) due to typical wear and tear are the physical and financial responsibility of the landlord. Tenants are generally only responsible for replacing batteries and light bulbs in appliances, damage through intentional or accidental acts (broken window or hole in the sheetrock), and preventative care (replacing AC filters, keeping the gutters free of debris, and lawn maintenance). Even repairs the tenant is responsible for and preventative care tasks can be better maintained by the property owner and charged to the tenant if needed. For instance, a dirty AC filter can damage the unit over a long period of time, so it is best that the landlord ensures these types of preventative maintenance tasks are done on a timely basis. Regular inspections, such as those performed by Real Property Management Prestige, can identify potential future problems and help reduce maintenance and repair costs in the long run.

 

 

Should I make the repair myself or hire a professional?

Small jobs, such as basic plumbing, might be fine if you are the handy with tools. This can save a great deal of money, but beware of making matters worse and costlier if you are not so skilled or knowledgeable about these small repairs. Even if you are skilled at these maintenance and repair jobs, consider whether it is worth your time and effort. If a team of professionals can get the job done in a timelier manner, your tenant may appreciate the convenience and resign the lease when it comes time. In addition, if you have several properties, these small jobs can add up, and you may not be able to get them all done as soon as the tenants would like, which can dissatisfy your tenants and prompt them to look elsewhere when the lease is up. Also, consider how much the repairs and maintenance will cost in materials. Professionals can often purchase materials at a lower cost, which might offset the extra money you would have to spend by hiring a company. Moreover, laws and property codes may require certain licensed technicians for larger and more complicated jobs such as AC/heater repair. If you are not licensed, it might be against the law to do the repair yourself. Consider the cost, time, and effort to maintain and repair your rental property versus the cost and convenience of hiring professionals.

 

Should I repair or replace that old appliance or structure in the house?

When is it best to repair an old appliance, or when should you just go ahead and buy a new one? Should you just patch some structure of the house or have that part completely rebuilt? Several factors must be considered to answer these questions. First, consider the age and condition of the appliance or structure, the expected lifetime, previous repairs, costs to evaluate the problem, and safety issues.

Repair appliance or structure:

  • If the age is less than half its entire expected lifespan.
  • If the cost of repairing is less than half the cost of replacement.
  • If the repairs will not inconvenience the tenants beyond what they will accept.
  • If the repairs are tax deductible during that year.

Replace appliance or structure:

  • If the age is more than half its entire expected lifespan.
  • If the cost of replacement is not too much more than the repair cost.
  • If you have repaired the appliance or structure many times already.
  • If the replacement would be a better convenience for your tenant than a repair would be and thus ensuring resigning the lease.
  • If the repair can result in injury to a person or damage to the property.
  • If it would be considered an improvement to the property and thus a tax deduction as it depreciates.

Remember, an ounce of prevention is worth a pound of cure… but a pound of cure trumps seventeen individual ounces of repair!

 

How much can I expect maintenance and repairs to my property to cost?

It is important for landlords to estimate how much maintenance and repairs will cost to a property so that she or he can plan and budget for it. Following are several formulas property owners can use to estimate the cost of maintaining and repairing their homes for their tenants:

  • 50% Rule: total operating costs (repairs, maintenance, taxes, insurance) will equal half of your rental property income. Ex: if your property rents for $1,200/mo, you should expect $600 of that to go to keeping the property up and running.
  • 1% Rule: maintenance will cost about one percent of the property value per year. Ex: a property valued at $190,000 should cost $1,900 a year to maintain (or $160 a month).
  • Square footage formula: Plan on $1 per square foot for yearly maintenance costs. Ex: a 2,200 foot rental should cost roughly $2,200 a year in maintenance costs.
  • 5x rule: maintenance costs will average 1.5 times the monthly rental rate. Ex: if your home rents for $1,200, then you should anticipate spending approximately $1,800 a year in repairs.

These formulas will help you plan and budget, but Murphy’s Law says, “Anything that can go wrong, will go wrong,” so also remember that:

  • 76% of yearly rental property maintenance and repair costs will be higher than you’ll expect.
  • 99% of rental property repair and maintenance expenses will be higher than you’ll want.

Can a landlord use the security deposit for maintenance and repair, and can a tenant use the security deposit as the last month’s rent?

A security deposit given to the landlord at the time the tenant moves into the house is set aside for particular purposes only. Often, misunderstanding and miscommunication regarding security deposits can result in unlawful acts by both the landlord and tenant. Be familiar with the laws that govern the use of security deposits.

  1. Security deposits can only be used for repairs due to the tenant’s intentional or negligent acts or to cover unpaid rent. Landlords may not use security deposits for normal wear and tear or make-ready, between vacancy repairs and cleaning costs.
  2. Tenants may not use security deposits as a stand-in for the last month’s rent. This money is set aside for damages beyond normal wear and tear repairs once the tenant vacates. The tenant must pay the last month’s rent, and then if the landlord inspects the house and finds no repairs needed beyond typical wear and tear, he or she must return the deposit to the tenant in full.

 

An Efficient Alternative to dealing with Maintenance and Repairs

Maintaining and repairing your rental property can be costly and time consuming, not to mention a great deal of hard work. If you do not want to deal with the midnight calls for stopped up toilets and broken AC units, Real Property Management Prestige can take those worries away with professional service teams and guarantee you and your tenants’ satisfaction.

 

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