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Video Transcript:

Hi, Todd Ortscheid here with GTL Real Estate. This week, I wanted to speak real quick just about a question we sometimes get from owners, either who have just started renting their property out, or they’ve moved out an old tenant and moved in a new one. Then all of a sudden, work orders start coming in.

We frequently get a couple different questions from this. Number one is why do I suddenly have all these service requests? I was just living in the property, it was fine, or the previous tenant was just there, it was fine. Why are these suddenly coming in? The other question is, should we get rid of this tenant. So I wanted to cover both of those things today.

The first thing we should point out is if you were living in the property before, just understand that there’s a difference between what an owner will put up with, basically, and what a tenant will when they move into the house. So part of being a tenant, that person has an expectation that stuff is just going to be fixed. A lot of owners, when they’re living in the house, something breaks, and then, for example, let’s say you got a four bed, three bath house and there’s a bathroom upstairs and a guest room that you just never use. So the toilet doesn’t work that great, but you just kind of don’t really care much about it, because you’re not expecting company for six months. And so you just kind of let it go. The tenants usually won’t do that. The way they look at it, they’re paying for rent. They want everything to work. It’s part of the mentality of renting. They just expect stuff to be fixed because they’re a tenant. That’s just an expectation from them for their landlord. Right or wrong, that’s just kind of what they expect.

That’s why in some cases, a landlord who was living in the property before just kind of let some stuff slide that the tenant won’t always ignore. As a landlord, you have a legal obligation to fix something if it’s broken. So it is something you have to get taken care of, even if it’s something that you might have looked past and said, “This isn’t really a big deal for me, when I live here,” for the tenant, they might consider it a big deal and they might expect it to be fixed.

Now of course, this does not apply to cosmetic issues. So like I said, in that example, that’s a toilet that’s not working. That’s not a cosmetic issue, that’s an actual fixture in the house that isn’t doing what it’s supposed to. So that needs to be fixed.

But if a tenant moves in, and let’s say the hardwood floors are scratched in one of the rooms, that was something they knew when they took the property. It’s a cosmetic issue. You don’t have to fix that. Occasionally, we’ll get these service requests from tenants for those kind of things, for cosmetic issues. They move in, they sign for the house, they say they’re okay with its condition and then all of a sudden a week later they start submitting these service requests saying they want this stuff fixed.

When they do that, we’ll tell them, “No.” We’ll just flat out say, “We’re not going to do that. You moved in with the property in this condition, it was noted on your move-in inspection. That’s the cosmetic condition of the property you agreed to take.” So in those cases, we don’t have to do anything on those repairs. Now, you certainly could if you wanted to, but you certainly don’t have to. Our default response on that is, the property was accepted as is cosmetically. So those are two different areas there, cosmetic or actual defects. Those are a little bit different. But when it comes to an actual defect in the property, something that’s broken, there is a legal obligation to fix that. Even if it was something you might not have worried about, the tenant will probably report that. It will have to be fixed.

The other thing to think about is, sometimes stuff just wears out. You could live in the house for a long period of time and then two months after a tenant moves in, the garbage disposal stops working. It could be because the tenant jammed something in the disposal and if we find something like that, we’ll charge the tenant for it. But honestly, it could also just be that it broke. You lived in the property for, say, eight years and the disposal wore out. That kind of stuff happens sometimes. So just try to be understanding about that. The tenant has a reasonable expectation that stuff is going to be fixed when it breaks. As long as they didn’t break it, as long as it wasn’t their fault, then as a landlord, at least in the states we do business, there is a legal obligation to get that stuff fixed. So just keep in mind, sometimes stuff does wear out, even if it was working perfectly when you moved out of the house.

The other thing is, some tenants just expect more than others. This comes into play when you have a switch in tenants. So you had a tenant that was there in the property maybe three or four years. They move out. The new tenant moves in and a week after they move in, they start reporting things that need to be fixed. A lot of times, what the case is there is just different expectations of different tenants, especially with a tenant who’s lived in the property for a very long time. A lot of times they start to view the property kind of like an owner and they’ll kind of overlook things, just like I said earlier, a lot of owners do when they live in their own house. There’s things that they just say, “Yeah, that’s not a big deal to me, so I won’t worry about it.” But then the new tenant moves in and they want everything to be working, so it’s a big deal to them.

So a lot of times, that’s what we see. The previous tenant, they just didn’t care about it. They didn’t report it. And the new tenant, they move in and they do care about it. They want it fixed. So sometimes that happens. It’s not necessarily that the new tenant’s being unreasonable. It’s just the old tenant was being really lenient and that’s why you didn’t get those things reported.

What I would say about that is, it’s really a good thing that the tenant reports real issues. Now, if a tenant is reporting cosmetic stuff, like I said, we’ll tell them, “No.” We’ll explain to them they have no reasonable expectation that that’ll be fixed. If they’re reporting bogus stuff, that’s a different story. For example, recently we had someone reported an oven not working. We show up and the oven’s working. It’s working perfectly. It just wasn’t heating up as quickly as they thought it should. But that’s how quickly that oven heats up. So when something like that comes in, we’ll charge the tenant for that. Keep that in mind. If something’s just a bogus, illegitimate work order, we’re not going to make you pay for that. We’re going to make the tenant pay for that. Of course, you’ll pay for the vendor to pay their invoice on the front end, but then we tell the tenant, “You’ve got 30 days to reimburse the owner. If you don’t, then there’s going to be late fees involved.” We collect that money for you when a tenant does something like that.

But if it is a legitimate repair request, if they’re reporting something that’s broken, even if it’s a lot of service requests, they move in and then they submit five service requests, if all of those things really are broken, it’s in your best interest to get those things fixed. You want your property kept in good condition, because the longer you let stuff go, the more expensive it usually is to fix it. If you fix it right away, it’s going to be much better than letting it go, and things can just deteriorate. That’s especially true with things like plumbing. If you’ve got a small leak under the sink and the tenant doesn’t report that, you may think it’s good at that point, because you’re not paying for a plumbing company to come out and fix a small leak, but later on, three years down the road, when that tenant hasn’t reported that and now there’s wood rot and mold underneath that sink and everything has to be torn out, drywall work has to be done, mold remediation, then you’ll really wish that that tenant had reported that.

It is a good thing when tenants report legitimate issues. You want to keep the property in good condition. It’s better for you from a long-term investment standpoint. It’s better to keep tenants in the property longer. You don’t want to be, frankly, a slum lord, as the saying goes, not getting things fixed. Because what that results in is bad tenants and frequent tenant turnover, which as we always say on these videos is the biggest expense a landlord can ever have, is tenant turnover. You want to keep that tenant in your property as long as possible, as long as they’re a good tenant. And someone who reports real issues is a good tenant. It might be a little frustrating when you first rent out your house and you’re getting several service requests in all at once, but ultimately, that’s a good thing for your investment.

You want to make sure that the property’s kept in good condition, because that’ll make sure you can rent it quickly and once you rent it quickly, you get that tenant in there, you want them to stay for a very long time. That’s what will get you your best return on investment and that’s the way you do that. Repairs are the number one reason that tenants say, in polling data, that they leave a property. So when they don’t renew a lease, that is the number one reason. They aren’t happy with the way that the owner is taking care of the property. That’s something we focus on. We want to get those repairs done quickly and properly. So keep in mind, it’s not necessarily a bad thing that a tenant is reporting several issues when they just move in. That really is probably in your best interest.

But if it’s not, like I said, if they’re reporting cosmetic issues, we’ll just tell them, “No.” Or if they’re reporting bogus things, then we’ll charge them for that. If it’s not a legitimate issue, remember, you don’t have to worry about it. So even if you’re getting a slew of service requests coming into your email, if they aren’t legit, if it’s just cosmetic things, don’t let it stress you out. Just know that we’re going to take care of that. We’re going to tell that tenant, “No,” and it’s not going to be an issue. That’s what we’re here for, so you don’t have to deal with that stuff. We have those email notifications that go to you, just so you’re aware of what’s going on, but it’s not anything you have to worry about. We’ll take care of all of it and we’ll make sure that those repair requests are all legit.

If you have any questions, send us an email, support@gtlrealestate.com. Thanks.