Real estate can be a great investment for the future. However, navigating landlord/tenant law can be a challenge, especially for new real estate investors. A first-time potential homeowner asked about buying a duplex, to live in half and rent the other half to help pay the mortgage. The conversation was a good reminder of the benefits and pitfalls of becoming a landlord, including some outright common myths. Let’s clear up a few common misconceptions for first time landlords.
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You are not responsible for all repairs
Some tenants believe anything that goes wrong is the landlord’s responsibility to fix. We have even had a tenant ask to have light bulbs replaced! While the owner or landlord does have an interest in keeping the property in good order, consumable supplies and tenant caused issues are more often than not the responsibility of the tenant. A common example? If a tenant put something down the drain or garbage disposal they should not have and a plumber needs to be called, the tenant must pay the bill. Friends, guests or pets of tenants that cause damage and is also generally the tenant’s responsibility to fix.
Generally, a landlord is responsible for major repairs that have to do with the “habitability” of the rental- items such as the furnace, air conditioning and basic appliances.
A landlord’s liability is usually limited to remedying issues, if not made, affect a tenants health, safety or welfare. But it’s also important to note how the damage was caused. If a door lock or window was broken by the tenant because the tenant locked themselves out of the unit, it would be the tenant’s responsibility to pay for repairs. If a lock is old and stops working, the landlord should cover the repair.
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You can’t discriminate, but there is a limit
There are laws that protect people, families and those with disabilities from discrimination– even those with a criminal history. However, when reviewing someone’s criminal history, if you feel someone could potentially put you, your property, or your other tenants at risk, that is a defendable reason to deny their rental application.
To avoid being accused of discrimination, consider the crime itself, when it happened, whether they were actually convicted (as opposed to just being arrested), and whether the nature of the crime puts anyone at risk. If you’re feeling concerned about the answers to those questions, chances are it’s within your rights to refuse to rent.
The following are other valid legal reasons to reject tenant rental applications:
- Poor Credit/ Low Income
- Negative references
- Evictions
- Criminal Records
- Pets (not including service animals)
- Incomplete or Inaccurate Application
Types of illegal discrimination include:
- Race, Color, or Religion
- National Origin
- Family status
- Age or Gender
- Disability
- Sexual Harassment
- Sexual Orientation
You should conduct a professional background check and credit report on all tenants. You will need to have tenants sign an application agreeing to you collecting this information.
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Generic lease forms are often not comprehensive enough
Many landlords use a generic rental form, such as one from the Hawaii Association of Realtors, in lieu of a customized lease agreement. This may be a good place to start, but make sure and put in and conditions specific to your property. For example, who is responsible for outside maintenance or pest control? Where will tenants park? Where will guests park. Keep your lease form updated to avoid conflicts in the future.
It is also a good idea to attach an inventory and condition form detailing the condition of the property at move in, including timestamped photos. This will give you and your tenant an accurate and detailed record in case anything should come into question at move out time.
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Conflicts like noise may be your problem to resolve
Most lease forms contain wording regarding quiet enjoyment. You expect your tenants to maintain a level of quiet, and they in turn can expect to live in relative quiet. If you have multiple units, such as in a duplex, and one tenant is throwing loud parties or playing the tuba at midnight, you likely will have to jump in and resolve the issue.
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You can enter your tenant’s space- if done properly
A landlord has a right to enter a unit as long as they give the tenant a ‘notice to enter’ in advance. According to the Hawaii Landlord Tenant Handbook, the landlord must give the tenant two days’ notice, and with tenant approval, enter only reasonable hours. The exception to this would be in case of emergency such as fire or a broken pipe. The law is in place to prevent landlords using this right of access to harass tenants. But if there is something you need to check on, or a repair you need to make, you can do it as long as you follow the law.
The Hawaii Landlord Tenant Handbook is a good guide to answer many questions you may have. If you need assistance managing your rentals, please give us a call at Destination Maui Realty, 808-879-0080.