No heat and water in rental property

22 Replies

Hi All,

I own a rental property in a condo development in NYC. One unit a few condos away is vacant (owner was foreclosed on). There is not heat in that unit and the water pipes keep breaking. As a result, they had to shut the water down to about 9 units until the vacant property is fixed. Currently my unit that is rented out has not had water since 7pm on 1/8/18. Also, we have base board head which runs on water. The property management company for the complex has been trying to get a plumber in since it happened but as of now, no plumber has come.  My unit has working pipes and working HVAC but since the main has been shut off, my water has been shut off along with 9 other units. I know NYC law says landlords must supply heat and hot water but this is beyond my control. Am I liable for this?

Thanks!

There must be something in that law that allows for maintenance of such systems. As for a slow response by the HOA, Check the HOA rules for that condo, there must be some kinda of recourse for you if they drag out the repairs.

Originally posted by @Matt Bacenet :

Hi All,

I own a rental property in a condo development in NYC. One unit a few condos away is vacant (owner was foreclosed on). There is not heat in that unit and the water pipes keep breaking. As a result, they had to shut the water down to about 9 units until the vacant property is fixed. Currently my unit that is rented out has not had water since 7pm on 1/8/18. Also, we have base board head which runs on water. The property management company for the complex has been trying to get a plumber in since it happened but as of now, no plumber has come.  My unit has working pipes and working HVAC but since the main has been shut off, my water has been shut off along with 9 other units. I know NYC law says landlords must supply heat and hot water but this is beyond my control. Am I liable for this?

Thanks!

 As the landlord yes you are liable. If you cannot get it on you would legally be required to provide accommodation for your tenants such as a hotel until it's fixed.

Now that said, after you make accommodation for your tenants I think your next step should be contacting an attorney to pursue litigation against the HOA of the condo complex for reimbursement of your costs.

James Wise, Real Estate Agent in OH (#2015001161)
216-661-6633

Hi Guys, thanks so much for the feedback. Luckily the HOA was able to get it resolved ASAP. They stepped in and repaired the foreclosed unit so the water can be turned on.

@Wilson Lee @James Wise @Michele Fischer I do find it weird that I am responsible despite the fact the city had to shut the water down until the foreclosed unit is repaired. If I was living there I wouldn't get a break on my mortgage payment or the bank wouldn't be putting me up in a hotel. All my pipes and appliances are working perfectly (knock on wood) but if the city comes and shuts down the main to the entire building, I cant see how that's my responsibility? 

Originally posted by @Matt Bacenet :

Hi Guys, thanks so much for the feedback. Luckily the HOA was able to get it resolved ASAP. They stepped in and repaired the foreclosed unit so the water can be turned on.

@Wilson Lee @James Wise @Michele Fischer I do find it weird that I am responsible despite the fact the city had to shut the water down until the foreclosed unit is repaired. If I was living there I wouldn't get a break on my mortgage payment or the bank wouldn't be putting me up in a hotel. All my pipes and appliances are working perfectly (knock on wood) but if the city comes and shuts down the main to the entire building, I cant see how that's my responsibility? 

this is in no way legal advice, but the way I look at it is the HOA is responsible if they are not performing repairs timely, but they are responsible to you. you, in turn, are then responsible to provide housing to the tenant. its like the HOA's responsibility would pass through you, to tenant.

@Andrew Boettcher Would the HOA have responsibility here either? There is a bank owned foreclosure in the building and a pipe burst before the unit main but still inside that unit. The guy below called 911 when water started coming in his unit and the city fire department came and shut down the water that feeds 9 units. The next shut off before the unit main is the main that feeds 9 units. Since the pipe broke in between the unit main and the main that fees 9 units, they had no choice but to shut down 9 units or water would continue to pour out. Since the problem stemmed from inside a unit, I would think its the unit owner or in this case the bank that would have sole responsibility here? I would think the bank would be responsible for all damages both physical and financial.

Once the board and property mgr got wind of this, they called a plumber to enter the bank owned unit and fix the pipe.       

@Matt Bacenet ,

Your tenants should have renters insurance to cover loss of use. You should have that as a requirement. Other than that you are the one that entered into a contract to provide them a place with heat and water. You are not meeting that requirement (and did not for 8 days). Regardless if all NY lost water, or if the ocean dried up and all water on the planet evaporated. You entered into a contract, not the HOA or the owner of a unit in the same building. Sure you can sue either of them after the fact to cover your losses (as recommended), but throwing your hands up and saying "not my problem" is not the right answer. You need to fix it.

If the president of their bank took all the money out of their account and ran off to Mexico would they still be liable for paying you? I mean it's not their fault how are they liable? Should they just say to you "Go after the bank president, he is the one who did wrong here, we are going to go watch Jeopardy, let us know how it goes"

DISCLAIMER: No legal advice given, it is just the mindless ramblings of some dolt on the internet, I am also unfamiliar with your local laws, any advice given was just a personal suggestion.

Mike Cumbie, Real Estate Agent in NY (#10401285310)
Originally posted by @Andrew Boettcher :
Originally posted by @Matt Bacenet:

Hi Guys, thanks so much for the feedback. Luckily the HOA was able to get it resolved ASAP. They stepped in and repaired the foreclosed unit so the water can be turned on.

@Wilson Lee @James Wise@Michele Fischer I do find it weird that I am responsible despite the fact the city had to shut the water down until the foreclosed unit is repaired. If I was living there I wouldn't get a break on my mortgage payment or the bank wouldn't be putting me up in a hotel. All my pipes and appliances are working perfectly (knock on wood) but if the city comes and shuts down the main to the entire building, I cant see how that's my responsibility? 

this is in no way legal advice, but the way I look at it is the HOA is responsible if they are not performing repairs timely, but they are responsible to you. you, in turn, are then responsible to provide housing to the tenant. its like the HOA's responsibility would pass through you, to tenant.

 Difference is the bank doesn't own the property, you do. They just lent you money. You are the owner of this home. You are providing those tenants a service. The rewards of ownership come your way but so do the risks. This is the cost of doing business.

James Wise, Real Estate Agent in OH (#2015001161)
216-661-6633

@Mike Cumbie I get what your saying. My tenants are required to have renters insurance as per the lease but to be honest I'm not sure they actually did get it but the agreement does require them to have it for instances like this. So thats on them if they didnt get it. The water was down for just shy of 24 hours. I haven't been able to get back on to give an update in a while so apologies for that.

@Matt Bacenet

Oh 24 hours......

Guess I should have paid better attention to when things were posted. 24 hours is a Oh well things happen. 8 days is ..... you should have done something long before. With 24 I would recommend they contact their insurance carrier and maybe throw them a gift card. 

Mike Cumbie, Real Estate Agent in NY (#10401285310)

@James Wise very well put. I understand what your saying. I was always under the opinion that I'm responsible for the unit itself and must make sure everything is in working order. I guess that opens up the question of where does it end? I'm responsible for the wiring of the house and making sure all appliances are working, but what if the tenant doesn't pay the water or gas bill and the utilities company shuts them off? Yes I am providing them a service but does that mean I have to pick up the bill to keep those services on?

Originally posted by @Matt Bacenet :

@James Wise very well put. I understand what your saying. I was always under the opinion that I'm responsible for the unit itself and must make sure everything is in working order. I guess that opens up the question of where does it end? I'm responsible for the wiring of the house and making sure all appliances are working, but what if the tenant doesn't pay the water or gas bill and the utilities company shuts them off? Yes I am providing them a service but does that mean I have to pick up the bill to keep those services on?

 Sometimes yes it does. Also sometimes you will need to pick up the bill to save yourself more loss.

Example: Property A is located in a cold climate like Cleveland, Ohio. It's -3 Degrees in January. Tenant stops paying the gas bill. If you let the gas company turn off the gas there will be no heat in the house. This will cause the pipes to freeze. Once the pipes freeze they will burst & cause several thousand's worth of damage like we see in the photo below.

You gotta ask yourself what's worse for the bottom line? Picking up some utility bills when you don't want to or this?

James Wise, Real Estate Agent in OH (#2015001161)
216-661-6633
Originally posted by @James Wise :
Originally posted by @Matt Bacenet:

@James Wise very well put. I understand what your saying. I was always under the opinion that I'm responsible for the unit itself and must make sure everything is in working order. I guess that opens up the question of where does it end? I'm responsible for the wiring of the house and making sure all appliances are working, but what if the tenant doesn't pay the water or gas bill and the utilities company shuts them off? Yes I am providing them a service but does that mean I have to pick up the bill to keep those services on?

 Sometimes yes it does. Also sometimes you will need to pick up the bill to save yourself more loss.

Example: Property A is located in a cold climate like Cleveland, Ohio. It's -3 Degrees in January. Tenant stops paying the gas bill. If you let the gas company turn off the gas there will be no heat in the house. This will cause the pipes to freeze. Once the pipes freeze they will burst & cause several thousand's worth of damage like we see in the photo below.

You gotta ask yourself what's worse for the bottom line? Picking up some utility bills when you don't want to or this?

 James, wow. At least not all the water landed on the floor? 

100% agree with your advice. thank you for that. 

How do your company plan for such a contingency? 

Do you ask the utility companies to bill your company, if a tenant decides to stop service, and then notify you immediately?

@James Wise All I can say is I hope that isn't a unit you own. But I definatly understand what your saying.

Owning one unit in a shared structure can lead to all sorts of problems caused by neighboring owners. The market is strong right now, so it is probably a good time to unload condos.

Originally posted by @Matt Bacenet :

@Mike Cumbie I get what your saying. My tenants are required to have renters insurance as per the lease but to be honest I'm not sure they actually did get it but the agreement does require them to have it for instances like this. So thats on them if they didnt get it. The water was down for just shy of 24 hours. I haven't been able to get back on to give an update in a while so apologies for that.

 You solve this problem by asking for proof of policy at lease signing and again at each lease renewal (this allows you to have the policy to make claims for tenant negligence and to verify they aren't dropping coverage after the first year). You can ask for one further and request your name to be added as "additional interest" which will notify you of any changes or cancellation to the policy. There are benefits to making a claim against tenant insurance for negligent actions they do in future vs. your own landlord policy to keep your loss history low or none (preferred).

Originally posted by @Chris T. :
Originally posted by @James Wise:
Originally posted by @Matt Bacenet:

@James Wise very well put. I understand what your saying. I was always under the opinion that I'm responsible for the unit itself and must make sure everything is in working order. I guess that opens up the question of where does it end? I'm responsible for the wiring of the house and making sure all appliances are working, but what if the tenant doesn't pay the water or gas bill and the utilities company shuts them off? Yes I am providing them a service but does that mean I have to pick up the bill to keep those services on?

 Sometimes yes it does. Also sometimes you will need to pick up the bill to save yourself more loss.

Example: Property A is located in a cold climate like Cleveland, Ohio. It's -3 Degrees in January. Tenant stops paying the gas bill. If you let the gas company turn off the gas there will be no heat in the house. This will cause the pipes to freeze. Once the pipes freeze they will burst & cause several thousand's worth of damage like we see in the photo below.

You gotta ask yourself what's worse for the bottom line? Picking up some utility bills when you don't want to or this?

 James, wow. At least not all the water landed on the floor? 

100% agree with your advice. thank you for that. 

How do your company plan for such a contingency? 

Do you ask the utility companies to bill your company, if a tenant decides to stop service, and then notify you immediately?

 You get whats called a landlord policy. So the bill is in the tenants name but in the event tenant doesn't pay it goes into your name automatically instead of service being interrupted.

James Wise, Real Estate Agent in OH (#2015001161)
216-661-6633
Originally posted by @Matt Bacenet :

@James Wise All I can say is I hope that isn't a unit you own. But I definatly understand what your saying.

 Na that one is a photo that one of my employees tagged me in the other day. I've had this happen to me & my clients properties before though. Not the end of the world, but your typically looking at a $10,000 bill or so for something like this. This was an extreme example, it usually looks more like this one that I am selling for a client.

James Wise, Real Estate Agent in OH (#2015001161)
216-661-6633

@Jeff Bridges If they didn't get the renters insurance but the lease agreement requires it, then wouldn't they be personally responsible for the damages?

Originally posted by @Matt Bacenet :

@Jeff Bridges If they didn't get the renters insurance but the lease agreement requires it, then wouldn't they be personally responsible for the damages?

 The lease agreement also requires that tenants pay rent on time, and many do not pay on time, but I know when that occurs and quickly enforce it. They are responsible for the damages regardless, but the renters insurance policy ensures that you actually recover said damages with the least amount of hassle possible.  At the end of the day, someone ponying up actual expenses is the outcome you need. Alternate options are file a claim against your landlord policy (creates loss history and risks increased premiums in future), take the tenants to civil court for neglect/ vandalism etc. (attorney costs, time, low tenant net-worth means might not be much to recover from tenant despite judgement and legal costs). doesn't a 3 minute exercise in enforcing your policies and requiring proof of policy seem like a good idea to cover your bases against the alternative outcomes if they don't in fact keep a policy? We do this same thing when we check for proof of utilities in the tenant name etc. This is extremely easy to incorporate into your lease signing checklist prior to tenant getting keys and totally worthwhile.

@Matt Bacenet Sadly, yes, and you can always pursue the PM company for the complex for damages. Now, your tenant maybe nice enough to find temporary housing, saving you some money. 

During these situations, you want to overcommunicate with your tenant, so you know when it is time to act fast. The last thing you want is for your tenant to sue you for damages. 

Hope this helps. Goodluck. Thanks! - Ola 

@Jeff Bridges you are totally right. I didn't really think of it that way.

@Ola Dantis I agree 100%, I have been in constant communication with my tenant on this and luckly we have a good relationship!

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