When something breaks at a rental property, owners often assume the tenant is at fault and responsible for fixing or replacing the broken item broken. It broke while they were living there so it must be their fault, right? Not only is that not right but if you charge tenants incorrectly, then it could be against the law and the tenant can sue you.
What is normal wear and tear?
Things at your investment property will fail over time and break and it can just as easily happen while your tenants are living there or while you’re living there. The difference is that owners understand if they’re living at the home then they are responsible for repairing or replacing what broke. It gets more confusing when a tenant is living at the property, and something breaks. Is it the tenants fault? Who is responsible for the cost to repair or replace?
If the item broke while the tenants were using it how it was intended to be used, then that’s considered normal wear and tear which is the landlord’s responsibility to fix or replace.
What can tenants can tenants be charged for?
Tenants can be charged for something they broke through abuse, misuse, or negligence which is often difficult to determine. One thing that helps is knowing how old something is and how long it’s expected to last. If it’s older and past its useful life, then the landlord is still responsible for replacing it regardless of whether the tenant is at fault, or it broke due to normal wear and tear.
What is estimated useful life?
Estimated useful life is how long a system, appliance, or fixture in your home is expected to last. Everything in your home has a different estimated useful life range associated with it. Many items are expected to last 10-15 years, but some things last a lot less and some more.
The length of time things last depends on many factors such as the quality of the item, weather (especially if it’s outside like screens or fences), and how much it was used. Some items last much longer than they’re expected to, but owners shouldn’t expect this and should be prepared to replace at their expense if something fails.
There are many resources and lists to help owners determine how long something is expected to last. For example, according to the International Association of Certified Home Inspectors (InterNACHI), the average life expectancy of a garbage disposal is 12-15 years.
How do you determine how much a tenant needs to pay?
Going with the same example of the garbage disposal useful life, if the tenant breaks the garbage disposal through misuse but the disposal is 16 years old, so past its useful life, then the landlord is responsible for replacing the garbage disposal.
Let’s say that the garbage disposal is only seven years old, so approximately half its estimate lifespan. In this case, the tenant can be charged for half the cost of replacement.
Hopefully, this helps make sense of what tenants can be charged when things break at your rental property. If a tenant lives in the rental for a long period of time, things will get older, and they are less likely to have to pay to replace or repair things when they move since there’s a good chance that many items will be past their useful life.
Knowing what you can charge tenants for and how much you can charge them will help make you a more informed property owner and help to keep you out of court.