Owning rental properties is a fantastic way to build a passive income stream and set yourself up for retirement. However, it’s not always easy being a landlord.
For example, if a tenant trashes your rental property or inflicts malicious property damages, the costs of repairs and renovations will come out of your pocket. Fortunately, there are ways to mitigate these types of damages. Just as importantly, you can ensure tenants are held accountable for the costs.
Keep reading for everything you need to know about limiting property damages in your rentals.
1. Be Specific About Property Damages in Your Lease Agreement
One of the best ways to minimize property damages to your rental unit is by writing specific language in your lease agreement. For example, be specific about what tenants are and aren’t allowed to do in terms of decorating. They don’t need to put a bunch of holes in your walls.
Similarly, make sure they know exactly what types of damages they’re responsible for in regards to paying for repairs. You may be accountable for major issues like roof damages, but you shouldn’t have to pay for repairs if a client puts their fist through a wall or breaks a window. Even accidental property damages like these are their responsibility.
2. Don’t Allow Your Tenants to Have Pets
While it may sound harsh to deny your tenants the right to have dogs and cats, these types of pets can be incredibly destructive. Not only will they tear up carpet, but they also have a tendency to scratch up doors, walls, and trim.
Furthermore, pet accidents can lead to long-lasting stains and odors. These are nearly impossible to get out of carpets. These issues also make it hard to market your rental to other tenants.
3. Invest in Good Property Insurance
One of the best ways to mitigate lasting damages to your rental properties is by buying high-quality insurance policies. These will help you cover the costs of any damages done by your tenants.
Rental property insurance will cover things like water damages, pet damages, broken windows, and more. It can save you tens of thousands of dollars on things like hail damage and other weather-related issues.
4. Institue a Security Deposit and Honor It
Tenant damages are almost unavoidable. That’s why most lease agreements include a security deposit.
However, you’ll find that tenants being charged with property damages throw a fit and do everything in their power to get their money back. Don’t back down and give them the money back that you’re entitled to. If they’ve damaged the property, they’ve forfeited the right to their security deposit.
Want to Reduce the Amount of Property Damages Done to Your Units?
As you can see, there are multiple ways you can mitigate property damages done by tenants. there are also ways to hold them accountable and receive compensation. Through clever lease agreements and proper insurance, you should be just fine.
And if you’re looking for more tips on how to be a better landlord or real estate investor, don’t go anywhere. Our website is here to help people like you get what they need in life.
