Property Inspections-What You Need to Know
Maybe you’re like other landlords in that you’ve got a million things going on in your life, and sometimes, being on top of your rental properties works its way down the priority list. But hey, even if you’re on the top of your game, anyone can benefit from some expert advice . We’ll make sure you know how often to inspect your property and what to look out for in order to maximize your return by keeping future repair costs down. For those of you who currently pay for professional management, pay attention because it’s important you’re getting what you’re paying for. Now, let’s discuss your cheapest and best property insurance; inspections.
Why Inspections are Important
It will never get less surprising, no matter how many years you’re in the business. When a distressed property owner reaches out and says, often casually, “I have no clue what the inside of my property looks like, my tenants generally pay on time, and rarely bother me” it’s usually an immediate red flag for us. Even more so when they tell us months have gone by without a rent payment, and they don’t know what the property looks like. Yikes.
Of course, there’s no real gentle way to ask how on earth they’ve let so much time go by, or why they haven’t fired their management company yet. But, we get it. Things get off track an inch at a time.
As long as the money is coming in, most landlords won’t have reason to pry. You really don’t have reason to start worrying if you’re getting your rent proceeds, but we promise, that’s not the right way to go about things.
Getting a full year of rent paid from a set of tenants is great…but what if their kids are drawing on the walls, they haven’t reported the roof leak that’s now browning the ceiling, and their AC filter looks like shag carpet?
The point is, you need to make sure they’re not causing damage; and even more so with things like AC filters which can lead to majorly costly repairs.
What Should Inspections Consist of?
Pictures alongside a simple inspection report are the key to proper documentation. Simply walking through the property and leaving is good, but not great. Properly notating its condition alongside detailed pictures will go a long way in the event there needs to be an eviction or making claims on the the tenant’s security deposit.
There’s three main categories of inspections when it comes to rentals; we’ll outline them and explain each one in detail:
Rent Ready: This inspection is when your property is ready to be marketed and for a prospective renter to see and possibly lease. It’s extremely important you have strong documentation of the property’s condition at this time so you have a benchmark to inspect against once the tenants vacate.
In Tenancy: These inspections are when the property is occupied. These are where most landlords or management companies lack, as they are arguably one of the most important and often overlooked property inspections. These are not as detailed since the property is filled with the tenant’s personal belongings; however, they are still detailed. Here’s an example of ours:
These In-Tenancy reports are designed to let the inspector stay on track and do a quick walk through, ensuring your property is taken care of.
Move Out Inspection: This is the same report as the Rent Ready inspection as it is the direct comparison to when the tenants first take occupancy to declare what items are to be charged off their security deposits. Having these two reports side by side is extremely important.
How Many In Tenancy Inspections Should I Do?
We have found that doing two in tenancy inspections around the 3rd and 7th month seem to work the best. It’s not over intrusive on the tenants, but is enough to keep a good eye on things. At lease signing, it’s important the tenants are made aware of the frequency of inspections you plan on doing. From a psychological standpoint, having the tenants know someone is coming into the property multiple times throughout the tenancy is great assurance that someone will be keeping an eye on things. Think about, who’s more likely to destroy a property; a tenant with a hands off landlord/management company who never comes inside-or the guys that are coming in a few times a year?
And even if you’re chummy with your tenants, do the inspections anyway. You simply never know, and it’s your best insurance policy you can have on your investment.
Conclusively, make sure you have eyes inside your property. Having reports and pictures to go along with them is a crucial step in mitigating surprises when tenants move out. It’s very common landlords switch to us from another company or self management in a total panic as their property sits in near ruin. These inspections are a simple preventative step.
If your management company isn’t providing you with at least 3 inspections a year, it may be time to switch. We’re always here!
239-542-6906 or message us on the chat function!