The most critical part of owning a rental property is having tenants who like where they live and pay on time. You don’t need to be friends with your tenants, but the fact is, your tenants have legal rights and, now that you’re a landlord, you’ll need to understand what they are.
Every rental property is subject to federal, state, and local laws that they must follow. The Fair Housing Act dictates that no landlord can refuse housing to a potential tenant based on race, nationality, sex, familial status, religion or disability. Some local governments go even further than these categories. For example, in the District of Columbia, source of income, status as a victim of domestic violence, political affiliation are all protected classes when it comes to housing. It’s up to every landlord and rental property owner to make sure that they’re in accordance with all relevant laws and regulations.
All tenants have a right to a space that’s safely inhabitable. That means that the unit must have working heat, electricity and plumbing. Beyond that, what constitutes a livable space varies depending on local ordinances. If you need to repair something critical, you may need to either provide your tenants with alternate accommodations or offer your tenants a credit for the length of time that the property was uninhabitable. It’s in the property owner’s best interests to make sure that the repair happens as quickly as possible. If you have tenants who are difficult, don’t be tempted to let the repair linger in the hopes that they’ll move out. When a tenant is forced to relocate due to the unit being uninhabitable, that’s called “constructive eviction” and your tenants can sue you for this.
Make sure that your lease is in accordance with local and federal regulations. For example, if your tenants are on a month-to-month lease and local laws only require a 30-day notice before moving out, you can’t add language that they need to notify you 60 days in advance. Anything that’s in your lease that contradicts local, state, or federal laws is not enforceable. If your tenants take you to court over a dispute related to any such item in your lease, you will lose.
Remember how we said that you don’t need to be friends with your tenants? We’ll go a step further and say that you shouldn’t be friends with your tenants. The reason for this is that it will be hard to enforce the rules of the lease, especially when it comes to late fees or nonpayment, if you have a friendship with your tenant. This can become an even greater problem if, for example, you wind up waiving a late fee for a tenant that you like and another tenant who had to pay a late fee finds out about it. What you think of as doing a favor for a friend can be perceived as discrimination when the rules are not applied equally. If something is in the lease, you must enforce it. It opens the door to unnecessary problems if you don’t.
The overwhelming majority of tenants just want a place to live. While it’s inevitable that there will be difficult tenants, it’s important to treat them with the same respect that you do your other tenants. Evictions are expensive and time-consuming, so always do what you can to avoid that process.