Repairs are a constant in the life of a landlord. Things break and need repairs. The repairs never, ever stop. Unfortunately, repairs cost money. Some repairs are bigger ticket items like HVAC equipment, but most repairs are the smaller nickel and dime variety. Either way it adds up. Can landlords shift some of these costs to tenants? Can landlords require their tenants to pay for repairs? If so, should they? Read on to learn more.
It Is Done With Commercial Properties
In a word, yes. Landlords can make require their tenants to pay for repairs, even the ones they did not directly cause. All that needs to be done is to include certain language in a lease, have the tenant agree to that language and sign the lease. In fact, requiring tenants to make and pay for repairs is quite common with leases on commercial property.
A residential lease could theoretically do the same thing (as long as there are no local laws prohibiting it). Or, as I know a few landlords do, a clause could be inserted into a lease that would make the tenant responsible for any repair under a certain dollar amount. $100 for example. Sounds easy right? Why are more landlords not doing this? Perhaps because making tenants pay for repairs is not so easy to do and it may in fact cost a landlord more later on.
It Is Perhaps Not That Easy
Making tenants pay for repairs, even minor ones, is just not very common in the residential rental market. The residential rental market here in most of the US has evolved with the landlord responsible for maintenance. This fact means tenants have choices in the market. Because they have to agree to pay for repairs before signing the lease, they can search for properties where they will not be responsible for repairs and then choose to live there. Of course, if a rental market is particularly tight, their options may be more limited. On the other hand, placing such a requirement in your lease may limit the number of applicants and restrict your ability to rent a property.
Plus, a landlord must consider the incentives created by such a policy. Will a tenant do the repairs their lease says they are required to do? Especially when they have to pay for it? Maybe, maybe not. To avoid a backlog of maintenance when a tenant moves out, a landlord with such a repair policy would need to be very proactive with property inspections to ensure that everything is being maintained properly.
Do The Benefits Outweigh The Costs?
So in sum, yes, a landlord can make a tenant pay for repairs, if they agree to do so in their lease. While this may sound like a great policy for a landlord to enact, I am not so sure the benefits would outweigh the long term costs.
Do you have a policy in your lease where the tenant pays for repairs? If so, what is it and how is it working for you? Please share with a comment.
Kevin Perk is the founder and publisher of Smarterlandlording.com. He is the author of Advice From Experience To New Real Estate Investors. Subscribe to Smarterlandlording here. Contact Kevin here.
I don’t tenants should be responsible for repairs I live in a property that is run by a management company who as far as the owner they don’t do any proactive up keep on the property at all which makes me uncomfortable at time they don’t inspect the furnace the hvac no duct cleaning and no hot water tank maintenance they just collect the rent