Lawsuits and legal pitfalls can plague rental property owners and managers, often resulting in costly settlements and operational turmoil. However, with proper knowledge and proactive steps, these threats can be avoided. Avoiding legal pitfalls begins with understanding the legal issues rental property owners and managers face and implementing industry best practices. This helps protect you and your properties while ensuring efficient management. In this article, we’ll delve into the most common lawsuits and legal pitfalls rental property owners face and offer practical steps you can take to avoid them.
Common Legal Pitfalls in Property Management
In the rental real estate industry, a few key legal pitfalls often lead a property owner or manager into a lawsuit or legal nightmare.
Violating Tenant’s Rights
One of the most common reasons a rental property owner or manager ends up in court is violating one or more of a tenant’s rights. Property owners are responsible for treating their residents fairly and equally and complying with fair housing laws. State and federal housing laws outline landlord responsibilities, which typically include:
- Offering a habitable living environment for tenants
- Addressing maintenance and repair requests swiftly
- Following local and federal housing and anti-discrimination laws
- Handling security deposits justly
- Observing legal eviction processes when required
Without care, landlords can violate a tenant’s rights in various ways—denying a disabled person a lease or mishandling personal belongings during an eviction can lead to costly lawsuits. The right to privacy also demands that landlords provide proper notice before entering, with violations risking serious legal consequences.
Negligent Maintenance and Repairs
Another common legal pitfall linked to tenant rights is failing to provide proper maintenance and repairs. The law requires landlords to keep a rental property safe and habitable, and neglecting this can result in personal injury, illness, or damage to personal property, potentially pulling a property owner into a lawsuit.
Lease Disputes
A third common area with potential for legal pitfalls is unclear or misleading lease documents. A lease is a contract outlining the terms under which one party agrees to rent an asset—in this case, property—owned by another party. It guarantees the lessee, also known as the tenant, use of the property and guarantees the lessor (the property owner or landlord) regular payments for a specified period in exchange. When lease documents are vague, unclear, or not specific enough, misunderstandings and legal action can result.
Proactive Steps to Prevent Legal Issues
Fortunately, rental property owners and managers can do much to prevent legal issues from emerging. Try these approaches:
- Clear and Comprehensive Lease Documents: Develop lease documents that are precise, thorough, legally sound, and clarify key terms. Review them with tenants to ensure understanding, then follow the terms closely and hold tenants accountable too.
- Training on and Adherence to Fair Housing Laws: Stay current with local and federal housing regulations for compliance. Grasp your obligations under the law and seek training to handle housing law disputes effectively.
- Effective Communication and Documentation: Foster steady, positive communication to boost tenant satisfaction. Praise tenant efforts, solicit their feedback, and tackle maintenance and repair requests promptly, sharing updates on work done on the property. Record all communications and agreements with tenants, including calls, professionally.
- Proactive Maintenance: Design and stick to a proactive maintenance plan. A strict maintenance schedule keeps the property and tenants secure.
- Fair Tenant Screening and Eviction Procedures: Apply consistent, fair methods for tenant screening, applications, and leasing. Conduct meticulous screenings and background checks and verify references. In an eviction, adhere to state and local laws, including timelines, notices, and proper handling of a tenant’s personal property.
Protect Your Business with Legal Precautions
To avoid common legal pitfalls and lawsuits, property owners and managers must master their duties, act ahead of problems, and implement sound management strategies. Consulting legal experts when unsure or facing a tenant taking legal action is wise. This protects you, your tenants, and your property.
Need support to ensure your property management is legally sound? Contact your local property management experts in Wayzata; Real Property Management Viking’s team is eager to assist. Get in touch with us online or call 612-230-3953 today.
We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.
