Usually, tenants are in charge of paying for the right to live in your rental property. Yet, there are cases where a Virginia Beach property manager would need or want to compensate a tenant. When specific problems emerge, you may find yourself in the odd position of paying your tenants instead of the other way around. To be as prepared as possible, it is advisable to understand what circumstances may necessitate tenant compensation and when and where you should offer it.
Tenant Compensation and the Law
The question of tenant compensation stems almost exclusively from landlord/tenant laws. As a property owner, you are in authority to ensure that your rental house is in a habitable condition. In general, this describes that your rental home is clean and livable. It also requires that your roof keeps the house dry and that the appliances and other elements work as intended. When the property isn’t habitable, for one reason or another, that can lead to scenarios where a tenant may be compensated.
Reasons to Compensate a Tenant
Some of the most prevalent reasons that a property owner may need to compensate a tenant include the following:
Repairs. One of the most common reasons a property owner would need to compensate a tenant is because of repairs. In some occasions, a property owner could be unable to perform necessary repairs. Whether you are out of town or otherwise unavailable, if something breaks and causes your tenants to lose the quiet enjoyment of the rental house, you need to address it. If you are unable to make repairs, your tenant may arrange for them to be done within the confines of state law. It’s better if the tenant seeks your permission first, but even if they don’t, you’ll almost certainly have to reimburse your tenant for the cost of repairs if they follow the state requirements.
Broken appliances. Sometimes compensation comes up in arguments about the condition and functionality of appliances. Avoiding taking responsibility for broken appliances is one of the primary causes a property owner gets sued by their tenants. A portion of this is because the subject is more complex than it first appears. Landlords sometimes argue that a broken dishwasher, while inconvenient, does not make the entire property uninhabitable. At the same time, a faulty oven or refrigerator is regarded as a big issue, and tenants may argue that the home is uninhabitable. For instance, you have provided appliances with the rental house. If one of them stops working, and you can’t repair or replace it immediately, your tenant may be justified in repairing the machine and deducting the amount from the rent, as prescribed in your state’s landlord/tenant law. This is certainly the case if your lease documents assign responsibility for the appliances to you as the property owner.
Cash for keys. A property owner may occasionally require a tenant to vacate a property before the lease ends. In certain cases, a landlord may offer to pay the tenant to move out. Property owners occasionally use this approach to avoid a drawn-out eviction process and encourage a problematic tenant to move on sooner than later. Considering how long it takes to evict a tenant and that you possibly won’t be collecting rent during eviction proceedings, proposing to pay them to move may save you money in the long run.
These are the most common scenarios, although they aren’t the only reasons why you may need to compensate a tenant. Nevertheless, if you ever find yourself in a position where payment is anticipated, it is critical to document everything cautiously and then issue the funds on time. If you are pro-rating a rent payment, you must record it and notify your tenant in writing. If you are required to send payment to your tenant directly, choose a payment method that offers a paper trail, such as a business check.
While landlord/tenant laws vary from place to place, staying on top of tenant compensation is important in keeping solid tenant relations. As a Virginia Beach property owner, you must have a comprehensive understanding of the landlord/tenant laws that govern compensation to guarantee that you are in full compliance. Real Property Management Hampton Roads can help you prepare a lease to cover these issues or even manage your property entirely. Contact us today to know more.
Originally published on October 9, 2020
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