Landlording & Rental Properties

Rental Property Inspections: 4 Types That Can Save Your Property (and Sanity)

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landlord-lessons

I am always amused by the responses I receive from real estate investors when I ask them when they had last inspected their properties.  It is obvious from their contorted facial expressions that they most likely have never “formally” inspected their properties.

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While preforming "safe and clean inspections" during a tenancy is important, ensuring that "move-in" and "move-out" inspections are performed at the beginning and end of a rental relationship can mean the difference between you as the landlord retaining all or a portion of the security deposit to compensate you for damages or losing it (possibly with triple damages) at the hands of a judge.

WHICH ONE SOUNDS BETTER TO YOU?

I am a huge proponent of inspections.  At the beginning, the end, and the entire time during the rental relationship. 

How did I get that way?  Simple…  I got my head handed to me by a judge and ended up paying triple damages.  OUCH!  Experience is a cruel and exacting teacher.

Regrettably, many landlords and way too many property managers have not assigned the same degree of importance to “inspections” as I have.  And this in my opinion, puts them at the mercy of the tenants, and if they are dealing with savvy tenants it will get painful!

What do you as a landlord do and what should you expect from your property manager regarding inspections?

Lets first start with some general definitions and a brief discussion regarding the four types of inspections I have found to be very useful as a landlord.

The Four Key Kinds of Landlord Inspections

1.  Move-in Inspection – This inspection, of course, is conducted during the move-in process. It must be conducted by the tenant and it must be documented. And, if you think you can move a tenant into a property without physically being present you are fooling yourself. So, as part of your move-in package, you will have a "Move-in" inspection sheet(s). The tenant needs to walk through the property and document issues with the property that could be a deduction from their security deposit when they leave. This inspection is not intended as a wish list for things they want done to the property. Of course, we are assuming the property was ready for the tenant or you wouldn't have placed them.

You want this inspection to be conducted by the tenant so that they can never say that they did not know the condition of the property when they moved in.  Once the inspection is completed, the tenant should sign and date the document and hand it back to you.  If there are issues such as a small stain in the carpet or a ding in the wall you should take a picture of it, print the picture and place it with “Move-in” inspection.

2.  Routine Safe and Clean Inspections – This is exactly what it says — a routine inspection, performed by you to ensure that the property is safe and clean.  This inspection should be conducted every 3 – 6 months; to go any longer and you may loose control of the overall condition of your property.  Realize that when you are conducting this inspection you are looking for issues which the tenant has caused, such as pulling a door off it’s hinges, and those items you are responsible for such as a leaking faucet.  Again, this inspection is documented, supported by pictures, signed by you with a copy provided to the tenant. If there are any issues, a follow-up inspection should be scheduled so you can verify the tenant has corrected the issues they are responsible for.  As for those issues you need to address, get on it!

3.  Drive-by Inspections – This inspection needs no pre-notifications. All you’re doing is driving by and observing.  Again, if there are issues observed on the outside of the property (the biggest one for me is typically pets that aren’t allowed), you should notify the tenant (in writing) and of course, schedule a “safe and clean” inspection.

4.  Move-out Inspections – The “move-out” inspection is your opportunity to determine the overall condition of the property when the tenant moves out.  This inspection should be conducted by you at the time you receive the keys from the tenant.  Realize that if you have the tenant drop the keys off at the office or put them in the mail, they will be able to deny everything you find on the “move-out” inspection because you weren’t there when they last locked-up and they will be able to blame you for all of the issues you claim when retaining their security deposit.  The only way to protect yourself is to conduct that inspection with the tenant in the property.  Ideally you want the tenant to sign the inspection findings, but many times the tenant will decline, believing that if they don’t sign they won’t be responsible.  One last item here — remember that your camera is your best friend; it is very hard for a tenant to deny in front of a judge what is obvious in a picture.

These four inspections can and will help you to keep your properties in good repair, hopefully well-maintained by your tenants, and protect you when you find yourself in front of a judge defending your security deposit decisions.

Best of luck!

Peter is an active and successful real estate investor in the Baltimore Maryland region for the past 8 years and is one of the founders of The Club Mastermind a real estate investing coaching progr...
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    Catherine
    Replied over 3 years ago
    As with everything there is a balance of respect–As a property manager we are hired to give the best we can we are entrusted with another’s property. Every month is definitely to many times to do an on site inspection when a drive by would be sufficient. One can tell a lot by how an exterior is maintained (unless there is a gardener). A short visual inspection every 3-4 months is not invasive as long as the person that is doing the inspection is not going into every nook and corner (unless warranted). This keeps tenants responsible knowing they have inspections coming. All these things need to be written out before the move in so there are no surprises. Knowing the facts always makes life easier.
    CJ
    Replied about 3 years ago
    As a renter who will have been invaded multiple times over the last three months, I can state without equivocation that these ‘inspections’ suck. At this point I’m not sure why they don’t just move in. When someone pays rent, they are also paying for privacy. They are NOT paying to have every Tom, Dick, and Harry coming in and checking things out. I don’t know who these people are. I don’t know their criminal records either. Every three months is highly intrusive. That said, I’m averaging once a month here. If you can’t handle letting people live their lives, stay out of property management. Period.
    Paul Sharp
    Replied almost 3 years ago
    People usually put the properties on rent as they think it is an effortless income source, but they are wrong. Tenants never take care of the property like their own home. Therefore you might need to invest after an inspection, that’s why better think about a better idea like reverse mortgage kinds of schemes.
    Katie Rogers from Santa Barbara, California
    Replied about 1 year ago
    When I was a tenant, I most definitely took care of the unit I lived in and always left the unit better than when I moved in. So do not say never, because it is not true. Also, there are plenty of landlords who do not care of their property.
    John
    Replied over 2 years ago
    I maybe late to comment on here, but I hope someone gets useful information from my comment. I’m a millennial and renter by choice. I understand the business, I understand the the need to check on a renter (for whatever previous emotion or experience you went through) however, we are people too. How would you feel if some random bank associate or some random inspector was goin through your place, without you there. Yes you sure have the option, but what if you can’t be there. You have no clue if it’s some creep going through your panties, to some weird woman going through your photos and smelling your clothes. Or worse, some untrustworthy person who’s plotting to rob you. That’s the bottom line answer from a renter. It’s just a strange thing. I’m what you’d call a normal person and have an ocd clean place with a lot of value fyi expensive things. I’m a man, and date. If some stranger came by and dug through your things or your significant other’s things, that’d be uncomfortable. I’m losing money, on purpose, to be home for this random 2-day notice, annual ‘bank inspection’. I’ve been here more than one year and have never seen and ‘annual’ inspection notice….. Hmm maybe the wording by the notice already has me feeling uncomfortable. I’d say: increase your front -end (starting) rental process and weed out the extreme cases there. I’d love to intellectually discuss this further,if you wish.
    Tony Kerzmann Rental Property Investor from Pittsburgh, PA
    Replied about 2 years ago
    My company manages multifamily communities (100-300 units) nationwide and we would like to start performing detailed, onsite property inspections that include an interview with the onsite property managers. Does anyone know of a company that will perform these inspections for a fee?
    Peter Wade Investor from Rushford, New York
    Replied about 1 year ago
    I have been in the property inspection business for over 15 years, and do inspections of apartments and complexes for insurance companies, and lenders. I have also owned residential and commercial rentals in the past. I cover all of western NY: Buffalo, Rochester, Jamestown, Corning and points in between.