Out-of-state newbie, $22K loss on a duplex. Is this on me or on my PM?

Birmingham, Alabama
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Out-of-state newbie, $22K loss on a duplex. Is this on me or on my PM?

Steven Harris
Member since 2026 · 5 posts · 4 votes

I'm an inexperienced out-of-state owner with one duplex in small-town Alabama (slightly outside of Birmingham), bought in 2021 and run by a property manager since day one. This year went badly and I honestly can't tell how much of it is my fault. I'd like blunt opinions.

Quick summary

- A long-term tenant kept a lot of cats in one unit (my realtor counted 20+).

- Total hit is about $22K: $12,700 cash out of pocket, $5,500 in rent lost while it sat vacant, and $4,400 the tenant never paid.

- The PM says the management agreement puts all of it on me.

What happened

- May 2025: PM recommended not renewing this tenant because of late rent. We chose to keep her. That one is on us....

- Aug 2025: my realtor found the cats and the urine smell, not the PM.

- The PM's "annual inspections" on file for 2024 and 2025 were self-inspections the tenant did on a phone app. The 2025 one showed nothing wrong.

- PM staff first walked the unit in Aug 2025, after we asked. They confirmed cats and odor and told us a fine, a removal deadline and a re-inspection would follow. I can't find a record of a re-inspection.

- Tenant stopped paying after Nov 2025 and left in March 2026. Deposit was $675.

- Repairs: new flooring and subfloor (about $6,400), then an odor specialist (about $3,100) after the PM's ozone treatments failed twice. We had to find the specialist... the PM gave up on fixing the issue.

- The unit sat vacant about 7.5 months while trying to get the smell out.

Where I think I messed up

- Kept a tenant the PM told me not to renew.

- Never asked how inspections were actually done, or read the reports.

What the PM says

- The agreement only requires "reasonable efforts" and does not warrant tenant behavior.

- It also has a hold-harmless clause and mandatory arbitration, so I've mostly ruled out legal action.

My questions

1. Is a tenant self-inspection a normal substitute for the PM walking the unit once a year?

2. As an out-of-state owner, what should I have been doing that I wasn't?

3. Is this just the cost of doing business, or would a good PM have caught it or shared some of the cost?

4. Leaving costs me 8% of the remaining rent on both leases. Is that worth paying to switch?

5. Is it worth chasing a former tenant like this for a judgment?

Thanks in advance. Tell me straight.

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Rachel Mazzanti
Virtual Assistant · Remote · Member since 2020 · 147 posts · 60 votes
3d

Steven, the $22K number is doing a lot of work here, and it helps to split it into three buckets, because the books treat each one differently.

The $12,700 cash out is the only part that is really a cost. The new flooring and subfloor will probably land as a capital improvement, not a repair, which means it gets depreciated instead of deducted all at once. The odor treatments are repairs. Same job, different tax treatment, and the CPA can only sort that out if the invoices are tagged when they arrive.

The $5,500 of lost rent and the $4,400 never paid are not deductions. That money just never showed up. On a cash basis the unpaid rent never existed on the books at all.

And the $675 deposit matters more than it looks. Whatever is kept for damages becomes income when it is applied, with a written disposition to the tenant, so keep that paperwork with the repair invoices.

The habit that would have caught the unpaid rent months earlier is the rent ledger. Read it every month, unit by unit. A tenant sliding behind shows up in weeks, not at move-out.

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  • James JonesPro Member
    Investor · Collierville, TN 38017 · Member since 2017 · 1k+ posts · 706 votes
    4d

    Steven, straight answer: both sides own part of this. You kept a tenant your PM told you not to renew, and you did not check how inspections were done. That part is yours.

    A tenant self-inspection is not a real annual inspection in my book. A good PM walks the unit, takes photos, and sends you a real report. Your PM found the cats only after your realtor did, and the unit sat vacant about 7.5 months. That is a management failure, not just bad luck.

    In Memphis I run numbers with a PM in them from day one: single-family under $100K, ARV $180K-$265K, Section 8 $1,395-$1,950 for 3BR+. If a deal only works without a manager, it does not work.

    On switching, I would not pay 8% to stay with a manager I no longer trust. Get the unit leased, then move.

    1Reply
  • Lee Futcher
    Technology · Vancouver, BC · Member since 2026 · 199 posts · 45 votes
    4d

    Morning Steven,

    I'm sorry this year went the way it did. You've been very honest about your part in it, which makes it much easier for people to give you a straight answer.

    I agree with James that a tenant self-inspection isn't a real annual inspection. I'd add one thing on your second question, because it's the part you can control from now on. From a distance, the habits that help most are simple: ask how inspections are done and read every report, ask for dated photos whenever a problem comes up, and agree in writing what the PM does next and by when. The August visit should have led to a written re-inspection date, and the fact that you can't find one is worth raising with them directly.

    Before you switch, I'd ask any new manager how they inspect, how often and what you'll see afterward. Their answers will tell you a lot more than their fee will.

    On chasing a judgment, a short consult with a local landlord-tenant attorney can tell you whether it's worth it in Alabama. I'm not a lawyer, and collecting from a former tenant often costs more than it returns, so it's worth getting that answer before you spend more.

    All the best,
    Lee

    2Reply
  • Diana KhanPro Member
    Attorney · 10451 Mill Run Cir #755 Owings Mills, MD 21117 · Member since 2024 · 756 posts · 273 votes
    4d
    Quote from @Steven Harris:

    I'm an inexperienced out-of-state owner with one duplex in small-town Alabama (slightly outside of Birmingham), bought in 2021 and run by a property manager since day one. This year went badly and I honestly can't tell how much of it is my fault. I'd like blunt opinions.

    Quick summary

    - A long-term tenant kept a lot of cats in one unit (my realtor counted 20+).

    - Total hit is about $22K: $12,700 cash out of pocket, $5,500 in rent lost while it sat vacant, and $4,400 the tenant never paid.

    - The PM says the management agreement puts all of it on me.

    What happened

    - May 2025: PM recommended not renewing this tenant because of late rent. We chose to keep her. That one is on us....

    - Aug 2025: my realtor found the cats and the urine smell, not the PM.

    - The PM's "annual inspections" on file for 2024 and 2025 were self-inspections the tenant did on a phone app. The 2025 one showed nothing wrong.

    - PM staff first walked the unit in Aug 2025, after we asked. They confirmed cats and odor and told us a fine, a removal deadline and a re-inspection would follow. I can't find a record of a re-inspection.

    - Tenant stopped paying after Nov 2025 and left in March 2026. Deposit was $675.

    - Repairs: new flooring and subfloor (about $6,400), then an odor specialist (about $3,100) after the PM's ozone treatments failed twice. We had to find the specialist... the PM gave up on fixing the issue.

    - The unit sat vacant about 7.5 months while trying to get the smell out.

    Where I think I messed up

    - Kept a tenant the PM told me not to renew.

    - Never asked how inspections were actually done, or read the reports.

    What the PM says

    - The agreement only requires "reasonable efforts" and does not warrant tenant behavior.

    - It also has a hold-harmless clause and mandatory arbitration, so I've mostly ruled out legal action.

    My questions

    1. Is a tenant self-inspection a normal substitute for the PM walking the unit once a year?

    2. As an out-of-state owner, what should I have been doing that I wasn't?

    3. Is this just the cost of doing business, or would a good PM have caught it or shared some of the cost?

    4. Leaving costs me 8% of the remaining rent on both leases. Is that worth paying to switch?

    5. Is it worth chasing a former tenant like this for a judgment?

    Thanks in advance. Tell me straight.

    @Steven Harris, I think you're being fair about your part in this, especially the decision to keep the tenant. But I wouldn't automatically accept that the rest of the loss is yours. I'd want to know what your management agreement actually required, whether tenant self inspections satisfied those requirements, and what happened to the promised follow up after the cats were discovered. A good manager should be able to show you what was done and when.

    I'm a real estate attorney and investor based in Maryland, and I work with landlords on leases, contracts, and property related disputes. I've seen how important the actual agreement and written records become when something goes wrong. Also, I wouldn't rule out your options just because the contract mentions arbitration or has a hold-harmless clause. I'd have an Alabama attorney review those provisions, the 8% termination fee, and whether pursuing the former tenant is worth the cost.

    I appreciate you sharing the full story, @Steven Harris, including the decisions you'd make differently. It's a useful discussion for other landlords, especially those managing properties from a distance. Happy to stay connected and exchange insights!

    [email protected]240-266-0291
    0Reply
  • Ametria Chaney
    Realtor · Memphis, Shelby County · Member since 2026 · 338 posts · 121 votes
    4d

    Steven, thank you for laying this out so honestly — that takes guts, and it's useful for other out-of-state owners. The detail that stayed with me is that your Realtor found the cats, not your property manager. That's the whole lesson in one line: an out-of-state owner needs local eyes on the property, and the inspection report is only as good as the person who actually walked through the door.

    For your second question, the habits I'd build are simple: every month, actually read the statement and the rent roll; every year, ask for dated photos and a written report from someone on the management team; and before you buy the next one, get the management agreement reviewed so you know what 'inspection' means in writing. And on the judgment question, I'd take Diana's point and get a short consult with an Alabama landlord-tenant attorney before spending anything chasing it.

    2Reply
  • Ryan SpathBusiness Member
    Real Estate Agent · Boise, ID · Member since 2017 · 602 posts · 385 votes
    4d

    Thank you for sharing your experience with this its important for people considering to invest that this type of thing can and does happen.

    [email protected]208-600-2814
    0Reply
  • Matthew Tregoning
    Property Manager · Melbourne, FL · Member since 2019 · 561 posts · 194 votes
    4d

    Steven, I’d ask for the repair timeline separately from the tenant timeline. When each odor treatment failed, who decided what happened next, and how long did that decision take? I manage vacation rentals remotely, and that gap between “the vendor came” and “the property is usable again” is something I watch closely. For a new manager, ask who owns that follow-through when the first repair doesn’t work.

    0Reply
    • Steven Harris
      OP
      Member since 2026 · 5 posts · 4 votes
      3d

      It was very painful. We had a meeting where I told them they were not responsive in June. Every action required me to email or call them for status update. They seemed like they never were ready to take on the next action. That is what took most of the time is the gaps between each step. This is the timeline i have documented:

      - 3/27: tenant out. Move-out inspection notes strong pet odor.

      - April-May: clean, paint, enzyme treatment, deodorizer. Inspections on 5/11 and 5/28 still found odor.

      - 6/10: I approved new flooring.

      - 7/2: PM asked me to fund it. I paid 7/17, so two weeks of that gap are mine.

      - 7/22: floor came up, work stopped for subfloor repairs. I paid for that 8/3.

      - 8/13: floor done. Inspection says it still smells.

      - Mid-Aug to 9/1: two ozone runs. On 9/1 the PM told me they weren't sure what was still holding the smell.

      - 9/10: my wife found an odor specialist and sent the PM their number.

      - 9/23: specialist consult. I approved and paid 9/25.

      - 10/9: treatment done. 10/12: inspection says no odor.

      - 11/6: new tenant in.

      Also, a replacement oven I paid for in July wasn't delivered until 9/21.

      The worst gap was the four weeks after 8/13. Nobody at the PM had a next step until we found the vendor ourselves.

      0Reply
  • Richard F.
    Honolulu, HI · Member since 2008 · 3k+ posts · 2k+ votes
    4d

    There are no "standard" management contracts or major processes among PMs. From your post is sounds like you have never visited the property, nor have you requested actual annual walkthroughs by the PM. If it wasn't important enough for you to review the reports that were provided, and ignored the PM rec to replace the tenant that was already behind on rent, it is pretty clear you simply do not belong in the business. You failed to properly investigate the PM at the outset to learn what their processes were. You did not state whether the PM placed the tenant originally or if they were inherited from the seller, but after closing the unit should have been thoroughly inspected and documented with photos. The tenants also, if inherited, should have been fully screened by the PM to determine if they met their qualifications or if they should have been non-renewed at the earliest lawful date.

    You don't mention anything about why the subfloor needed replacement, or what other repairs were needed beyond the odor control, so I question what the actual condition of the unit is after the repairs were "finished". No mention of painting, or any common items. It probably will sit empty even longer if it shows poorly.

    Lastly, no way in heck would I allow that PM to place another tenant, because it is likely they will land another subpar occupant with minimal screening just to fill the space. It's no skin off their back since they couldn't handle one little old cat lady.

    I've managed properties for dozens of out of state owners, and every one of them would fly in every year, or every other year for a scheduled walk through of their property. Even though I routinely sent annual reports with pics, they were interested and wanted to get eyes on first hand. Many of those Clients were managed for well over 10 years without issue.

    1Reply
    • Drew SygitBusiness Member
      Property Manager · Royal Oak, MI · Member since 2012 · 13k+ posts · 9k+ votes
      3d

      @Richard F. surprised you're being so harsh on the PMC.

      Poster stated their "cat lady" was a long-term tenant, so how are you surmising they did a terrible screening job?

      Would appreciate your evaluation and additional input on my posted analysis:)

      [email protected]248-209-6824
      Logical Property Management4.9462 Reviews
      WebsiteView Page
      0Reply
    • Richard F.
      Honolulu, HI · Member since 2008 · 3k+ posts · 2k+ votes
      2d

      It is not clear from the OP that they ever performed an initial screening on the cat lady. I have, since very early years, always required that inherited tenants complete an applications for our records. We did not charge for the application, even though we still ran the normal screen. One PM/LL's "good" tenant does not mean they fit our definition. We also, always, performed an initial inspection with pics to document our "takeover" findings of occupied units. This was not just to track the tenant performance and provide a lawful baseline of "before" condition for SD purposes, but also to protect us with regard to the prior LL/PM condition claims. Frankly, if the PM did not convince the OP to non-renew the tenant, he was more concerned with keeping the management fees than looking out for the best interest of the Client.

      Add the fact OP states PM "first walked the unit" in 2025...if PM has not set foot in the unit over 4 years, there just is no excuse. Our Management agreements never even state anything about performing inspections of any type...it was simply assumed. You cannot be effective without a decent regular visual inspection. Regular inspections by someone with 20/20 should have discovered a cat at some point.

      Lastly, you likely have already read my later comments in this thread, where the OP stated on another forum, virtually identical details as here, with the addition that he had 3 evictions from that property since 2021.

      Drew, it looks like you have adopted a new friend. Better than most, but noticeable, nothing wrong with that...

      0Reply
    • Steven Harris
      OP
      Member since 2026 · 5 posts · 4 votes
      2d

      Richard,

      Tell me a little bit more on your “initial screening” comment. Are you saying that is something I should be doing? My PM should be doing? (They told me the screen all tenants…including this one) or something I should be managing my PM a little more closely…

      Thanks for your feedback.

      -Steven

      0Reply
    • Richard F.
      Honolulu, HI · Member since 2008 · 3k+ posts · 2k+ votes
      2d

      Sure. First of all, if your management agreement is handing over "management" to the PM, they should be doing this, IMHO. If you are DIY LL, you should do it. I am assuming the rental agreement is between the PM and the tenant, so the PM is the one that "should" do it. Should is in quotes because it depends in large part on exactly what the management agreement states as included or as extra cost options. Or, whatever you negotiate for prior to signing. Like Doctors and Auto Mechanics, all PM's are definitely not the same. Some nickle and dime you, others are pretty inclusive, either way it is up to you to figure out before signing.

      Since you state that they did screening, in the future you should find out exactly what that process is, what their information sources are, and what their criteria for acceptability is. Many LL/PM's make decisions based on a credit or other "rentability" score, and some vague "background" check, plus an income requirement. Without learning exactly what generates each score or pass/fail decision, you miss out on a lot of potentially good tenants, and, depending on what the bar is for some of those elements, you allow in a lot of folks that really have some Bad Habits that will eventually show up in your rental...maybe not until they move out, particularly if no one is performing a legit annual inspection. By legit, I simply mean someone knowledgeable, with 20/20 vision and a strong flashlight, that knows exactly where to look for potential signs of water, pests, and other issues. It takes maybe 15 minutes to inspect AND take pics along the way to document.

      It doesn't matter if an existing Client comes to me with a newly purchased property fully/partly occupied, or we take over management from another PM for a new client. Either way, the first day I have keys, I walk the property and post a notice of inspection for within 7 days. If I am aware of an impending purchase for a client, I will request the Seller/Agent to provide our basic contact info to their tenants, which I will follow up by sending a further letter of introduction and details, and a requirement that they contact me to schedule an inspection within 7 days.

      The purpose of the inspection is straightforward...I need a baseline of conditions between now and when it goes vacant; I need to assess for any urgently needed repairs, replacements, or maintenance; I closely inspect for any signs of current/past water intrusion or leaks, pests, and general housekeeping.

      After completing the inspection, I briefly interview the tenants, confirming info received from seller, as well as inquiring if any issues were unresolved or any appliances were not functioning properly. Were there any side agreements? What vehicles belong to them (if multi fam property)? I also ask about their intentions once the term of their existing rental agreement (which must be honored) is up. Do they love the place? Do they plan to move? Is their family growing? etc.

      Depending on how I was able to initially contact them, at some point I provide them with a standard Rental Application and request them to complete it, and provide copies of current paystubs or other relevant documentation. I also advise them that their current agreement will be terminated with the proper notice at end of term. If they want to remain, they will need to pass our screening, and sign our rental agreement...all adult occupants. I don't charge them for screening as an existing tenant, but I want to KNOW about them...including Court records of all kinds, as well as credit and other usual info. Typically bad tenants have a history of Bad Habits, and I am looking for those from the outset. I don't care what a prior LL/PM "approved" or considered to be a "good" tenant.

      Once I have all of this information, I can make a determination if this is someone we actually want to keep, or not; and if the property is near enough to our standards to minimize excess service calls and keep the tenant happy; or does it need to be vacated at the earliest lawful point to address either of these reasons. Of course as a PM, I review this info with the Owner, providing copies of pics and my recommendations. We discuss and act accordingly.

      0Reply
  • Inder Singh
    Real Estate Agent · Boston, MA · Member since 2025 · 88 posts · 28 votes
    4d

    Steven, straight answer: you own the renewal call, the PM owns the inspection failure — and the inspection miss is what turned a bad tenant into a $22K problem.

    A tenant self-inspection is not an annual inspection. I self-manage 17+ units across 5 buy-and-hold deals through our company, and our rule is simple: someone we trust walks every unit at least once a year, with dated photos and video, and the owner actually sees them. A PM who won't do that isn't managing — they're collecting.

    Going forward, build three habits: read every monthly statement line by line, require photo and video walkthroughs on file, and have your own person walk the unit once a year. Your realtor found this, not the PM — that one habit would have caught the cats a year earlier.

    On the 8% exit fee, don't pay to stay with a PM you no longer trust. Get it leased, then move it. And I'd skip chasing the tenant — put that energy into a PM who actually inspects. Happy to compare notes, my DMs are open.

    0Reply
    • Drew SygitBusiness Member
      Property Manager · Royal Oak, MI · Member since 2012 · 13k+ posts · 9k+ votes
      3d

      @Inder Singh why is your way, the only or best way?

      Self-inspections can be pretty thorough if done correctly and properly reviewed.

      Of course, they are not perfect - as nothing is perfect.

      • How can you guarantee that you catch everything on your in-person inspections?

        • Are you a licensed inspector or builder?

        • How well do your annual inspections compare to professional inspections that go into crawl spaces, attics, do drone shots of roofs, etc?

      I've been doing this for almost 30 years and I know I do NOT catch everything when I walk a property.

      But I also do not want to pay $300+ annually for a professional inspection.

      [email protected]248-209-6824
      Logical Property Management4.9462 Reviews
      WebsiteView Page
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  • Anitha BalaPro Member
    Member since 2024 · 19 posts · 4 votes
    3d

    Hi Steven, I am going thru a similar experience but not as bad as yours. the tenant was behind on payment and I finally asked the PM to give them the 30 day notice (there was PM negligence in siding with the tenant for their consistent late payments) but long story short the tenant moved while I was thinking it was going to be an eviction issue (contacted lawyers and was getting ready for it..chatgpt also helped me ask PM to issue the notice on time so I didnt lose another extra month!)..

    steps I am taking from the lessons learned:

    a. Besides all the comments above of ensuring the tenant pays full on time (review ledger statement does not show exact date of payment in my case) and checking how often they are on late schedule

    b. If they are behind by more than a month jump and take action for giving notice etc.

    c. A bad tenant is a bad tenant is a bad tenant..same goes for PM..

    c. I am also going to focus more on the new tenant. If PM will not share their credit report I plan to ask several questions in a checklist I have created for myself

    c. I have made a list of everything on the PM contract that did not work and I am shopping around for a new PM and taking all the PM landlord and tenant contracts and reviewing them on chatgpt and then potentially going to hire a lawyer to see if an addendum can be added

    Live and learn...good luck

    0Reply
    • Drew SygitBusiness Member
      Property Manager · Royal Oak, MI · Member since 2012 · 13k+ posts · 9k+ votes
      3d

      @Anitha Bala fantastic that you are getting more involved in understanding your PMC's processes!

      FYI, your PMC can NOT legally share their background check with you due to federal privacy laws and their contract with their service provider.

      • if they do, great for you, but shame on them for not knowing the law.

      Be sure to ask them for details on how they handle late payments and past due balances.

      • We have clearly defined processes for our team to follow that we can share with owners

      • Even these though, only cover around 95% of situations as there is always something unique in this business.

        • Then communication and owner input become important!

      [email protected]248-209-6824
      Logical Property Management4.9462 Reviews
      WebsiteView Page
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  • BJ Everson
    Realtor · Columbus, Franklin County · Member since 2026 · 135 posts · 53 votes
    3d

    Steven, blunt take from a Columbus investor who self-manages 1–4s and works with OOS buyers: tenant self-inspections are not annual inspections. I would never accept that as the only walk. What I require in writing before I hire (or keep) a PM: (1) manager walks every unit at least yearly with dated photos/video the owner actually receives, (2) a clear renew/non-renew recommendation with rent ledger attached, (3) a repair follow-up owner can see when the first fix fails. You own the renewal call after they flagged late rent. They own the inspection miss that let cats and odor run until a realtor walked it. On switching: price the 8% exit against another 7.5 months vacant — if the new PM will do real walks and odor/turn protocols, the fee is usually cheaper than another failed turn. Are both sides of the duplex on the same manager, and do you have the management agreement's inspection clause handy?

    0Reply
    • Steven Harris
      OP
      Member since 2026 · 5 posts · 4 votes
      3d

      Same manager on both sides... The agreement says periodic inspections happen "upon written request by owner." It also says the PM reports only conditions "reasonably visible" on a walk-through. I just got email today that they got a renter's deposit on this unit after the 7.5 months of dealing with the odor damage.

      0Reply
  • Daniel Jung
    Member since 2026 · 79 posts · 28 votes
    3d

    Blunt take: you own the renewal decision, and the PM owns the inspection failure. That inspection miss is what turned a bad tenant into a $22K loss.

    A tenant self-inspection is not an annual inspection. You pay a manager so someone on their team walks the unit, takes dated photos, and sends you a report. Your realtor finding the cats before the PM did says it all.

    Two things I would do now. First, get the management agreement reviewed by an Alabama landlord-tenant attorney before you treat the arbitration clause, hold-harmless, or 8% exit fee as final. Those clauses are often narrower than a PM claims. Second, do not let this PM place the next tenant. Get the unit leased, then move to a manager who puts inspections, re-inspection dates, and repair follow-up in writing.

    I would skip chasing the tenant and put that energy into a better manager.

    0Reply
  • Richard F.
    Honolulu, HI · Member since 2008 · 3k+ posts · 2k+ votes
    3d

    The Plot Thickens. @Steven Harris I see from your post on a different forum that you ALSO evicted three prior tenants since 2021. Clearly whoever provided the criteria, or is actually performing the tenant screening, is FAILING. This may be due to the property not attracting better tenants to begin with, and this needs to be properly evaluated.

    I don't care WHERE a property is located, you need to appeal to the best of the worst if that is the market. Every pricing tier has applicants at the top and at the bottom of the tenant pool, you need to get the attention of the top 10%. The fact you did not mention painting as part of your recent turnover tells me it is being rented "as is", which is not how you appeal to anyone that is not desperate.

    Screening must be thorough, and performed on every adult occupant, period. You cannot rely solely on a credit or rentability "score", or some random third party "background check". The person evaluating the applicants must know the details that generate those scores and ratings. What is the cost per applicant for screening? The PM should be eating enough of that to attract many more applicants. I never charged over $10 per person, the rest is a write off for the owner.

    0Reply
  • Jules Aton
    MD/DC · Member since 2024 · 1k+ posts · 1k+ votes
    3d

    Ugh this is lousy and I appreciate your candor as I suspect for as many of these horror stories we hear of there are many more that never make the forum. I hope those reading this who are getting the okey-doke from out of state professionals extoling the virtues of this method take heed. I have two OOS STRs that are in class A neighborhoods. I became familiar with the area in advance, was there once a month during purchase, rehab and also stay there several times a year to actually see what's what. There are definitely skilled, honest Realtors, contractors and PMs out there but I suspect they are not as abundant as those who aren't and regardless no one is going to care for your finances like you will.

    0Reply
  • Aiden AvtgisBusiness Member
    Real Estate Agent · Cleveland, OH · Member since 2024 · 52 posts · 37 votes
    3d

    @Steven Harris ugh - that is a tough situation. Kudos to you for recognizing where you could have done things differently, but I also think you have some legitimate concerns about how the property was managed. I work with a lot of out-of-state investors here in Northeast Ohio, and one thing I always emphasize is the importance of having reliable people on the ground. That's a big part of why you hire a property manager in the first place.

    If there's one thing I'd say falls on you as the owner, beyond the decision to renew the tenant's lease, it's that this particular property manager clearly needed tighter supervision and follow-up than they were getting. For example, I would have wanted to know how those annual inspections were being conducted. Personally, I wouldn't be comfortable relying solely on tenant-submitted inspections without someone from management physically walking the property periodically.

    The other big one is the lack of follow-up after the cats were discovered. Once management told you there would be a fine, a deadline to remove the animals, and a re-inspection, I would have followed up to make sure those things actually happened and asked for documentation. That said, I don't think an owner should have to constantly chase down their property manager to make sure they're doing what they're being paid to do. There's a reasonable level of oversight an owner should maintain, but the whole point of hiring a PM is to have someone handling the day-to-day issues.

    As far as switching companies, I'd look at the bigger picture rather than just the termination fee. If you've lost confidence in their ability to manage the property properly, that could end up costing you more in the long run. I'd also consider having an Alabama attorney review the agreement before completely ruling out your options for recovering some of the losses.

    Unfortunately, situations like this can be part of owning rental properties, but I wouldn't necessarily chalk the entire $22K up to the cost of doing business. There are lessons here on both sides, and hopefully you can put some better systems in place going forward so you're not dealing with something like this again.

    0Reply
  • Jimmy LieuBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2019 · 3k+ posts · 2k+ votes
    3d

    Steven, sorry you're dealing with this, and credit for laying it out so plainly. A few things that haven't come up yet.

    On inspections, I'd treat a tenant's phone-app self-inspection as a tenant statement, not an inspection. Going forward, ask in writing that every inspection be done by PM staff with dated photos and a short condition report sent to you. Ask for a quick quarterly summary too: rent status, complaints, inspection dates, anything pending. Out-of-state owners get in trouble when they only see the monthly statement.

    On leaving, ask the PM what the 8% fee actually covers and whether any of it is negotiable given the missed re-inspection. A calm, written request costs nothing. Have a local attorney read the arbitration and hold-harmless language before you decide anything, because I can't speak to how Alabama courts treat it.

    On the judgment, it only pays if the former tenant has income or assets to collect from. Check that before spending on filing.

    Happy to connect and compare notes.

    [email protected]614-300-7535
    Jimmy Lieu, Red 1 Realty4.9124 Reviews
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  • Jim Johnson
    Real Estate Agent · Memphis · Member since 2026 · 621 posts · 358 votes
    3d

    A few things stand out here:

    1. Inspections: Tenant self-inspections can be useful, but I wouldn't consider them a replacement for the PM actually walking the property, especially with an out-of-state owner.

    2. Owner oversight: Reviewing inspection reports and following up on unresolved violations would have helped. You already acknowledged the decision to renew, but that doesn't excuse everything that happened afterward.

    3. PM responsibility: The missing re-inspection is concerning. If they promised a deadline and follow-up, there should be documentation showing what happened.

    4. Switching PMs: I'd compare the termination fee against the risk of staying with a company you've lost confidence in. Eight percent isn't insignificant, but neither is another poorly handled turnover.

    5. Pursuing the tenant: Before spending more money, I'd look at whether there's a realistic chance of collecting anything, even with a judgment.

    The biggest issue to me isn't that the tenant caused damage. It's whether the PM followed through once the problem was discovered.

    0Reply
  • Ming Yi
    Investor · San Francisco · Member since 2026 · 60 posts · 28 votes
    3d

    Sorry, that is a brutal first lesson, and most of it sits with the PM, not you. A tenant self-inspection through a phone app is not an annual inspection. An inspection means someone walks the unit, opens closets, checks under sinks, and takes dated photos, and you get the photos. Twenty cats do not appear overnight, so either nobody walked the unit or nobody told you what they saw.

    For an out-of-state owner, the fix is boring but it works. Require a written inspection report with photos at least once a year, a monthly rent ledger, and a lease that spells out pet rules and the penalty for breaking them. Review the ledger yourself every month, even when the PM says everything is fine.

    On the exit fee, run the math. If the PM missed this, the 8 percent is cheap compared with another year of the same. On the judgment, ask a local attorney what collection actually looks like. In most cases the paper judgment is easy and the money never comes.

    0Reply
  • Divin KanyamaBusiness Member
    Accountant · Seattle, WA · Member since 2025 · 684 posts · 288 votes
    3d

    @Steven Harris I'm sorry, that's a tough year, and it's hard to sort out how much was avoidable. My honest take is that the blame is shared, but you're not the only one who could have done better here.

    Keeping a tenant the PM flagged was a reasonable judgment call that didn't work out, and plenty of new owners don't dig into inspection reports. A tenant doing their own phone inspection isn't a real substitute for someone walking the unit, though, and the missing re-inspection after the cats were confirmed is a fair thing to raise.

    For the future, ask for dated photos and reports from every inspection, and get a regular written summary of late rent and complaints. A local friend or contact who can drive by now and then helps too.

    Some damage is just part of owning rentals, but a good PM would probably have caught this sooner and kept it smaller. I'd look at your agreement for a for-cause termination option before paying the 8%, and get a few quotes from other managers.

    As for the former tenant, small claims could be worth a try for the unpaid rent, but only if she has income or assets to collect from. You might also ask the PM, politely and in writing, for a partial credit. It can't hurt.

    Hang in there, and I hope the next year is calmer.

    [email protected]
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  • Mike FisherBusiness Member
    New Lenox, IL · Member since 2024 · 148 posts · 75 votes
    3d

    Steven, the line that matters most now is the one you quoted: inspections happen "upon written request by owner." That clause works for you starting today.

    1. Send the written request this week for the other side of the duplex. Same manager, same inspection gap, and nobody from their team has walked that unit either. Ask for a manager walk with dated photos of every room, under the sinks, and around the water heater and furnace, plus the date it will happen.

    2. Your new tenant just moved in. Ask for the move in condition report with dated photos now, while the new floor and the odor work are fresh. That file is what any future deposit claim rests on, so make sure it is complete before the first rent check clears.

    3. Put one standing request in writing: any repair that fails gets a written next step and a date within 48 hours. Your four week gap after 8/13 was not a vendor problem. It was nobody owning the next step.

    4. On the 8%, ask exactly what it is 8% of. If it is remaining lease rent, the fee shrinks every month you wait. Two requested inspections and a clean move in file will tell you quickly whether this manager can do the job when asked in writing, so you decide on facts instead of frustration.

    Mike, M Property Group LLC, south and southwest Chicago suburbs

    [email protected]
    M Property Group LLC | MF Cashflow Property Management4.997 Reviews
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  • Rachel Mazzanti
    Virtual Assistant · Remote · Member since 2020 · 147 posts · 60 votes
    3d

    Steven, the $22K number is doing a lot of work here, and it helps to split it into three buckets, because the books treat each one differently.

    The $12,700 cash out is the only part that is really a cost. The new flooring and subfloor will probably land as a capital improvement, not a repair, which means it gets depreciated instead of deducted all at once. The odor treatments are repairs. Same job, different tax treatment, and the CPA can only sort that out if the invoices are tagged when they arrive.

    The $5,500 of lost rent and the $4,400 never paid are not deductions. That money just never showed up. On a cash basis the unpaid rent never existed on the books at all.

    And the $675 deposit matters more than it looks. Whatever is kept for damages becomes income when it is applied, with a written disposition to the tenant, so keep that paperwork with the repair invoices.

    The habit that would have caught the unpaid rent months earlier is the rent ledger. Read it every month, unit by unit. A tenant sliding behind shows up in weeks, not at move-out.

    3Reply
    • Nadia Khan
      Virtual Assistant · USA · Member since 2026 · 14 posts · 1 vote
      3d

      Great explanation! Keeping proper records and separating expenses makes property accounting much easier.

      0Reply
  • Drew SygitBusiness Member
    Property Manager · Royal Oak, MI · Member since 2012 · 13k+ posts · 9k+ votes
    3d

    Recommend you pay extra attention to the responses from PMCs (like us) vs other DIY landlords.

    There's a lot of facts missing from your story, but ultimately, you picked the PMC so it's 100% on you.

    • You're unlikely to win a lawsuit against the PMC, which you can verify with an attorney.

    Observations & Questions:

    • What did the lease state about pets?

    • When did you and the PMC become aware of the cats and that there were 20?

    • A tenant self-inspection is common, and may be acceptable - depending on how thorough it is and what it shows.

      • Obviously, it can't convey odors

      • How well did YOU review the self-inspections?

      • What was on them that showed the cat situation?

      • What issues did your PMC bring to your attention?

      • WHEN were they done? Should have been 45-60 days BEFORE end of lease, so data can be used to evaluate renewal decision!

    • Aug 2025 - why was your agent at the property?

    • How long was this tenant in the unit?

      • Renewal was in May 2025, stopped paying in Nov 2025

      • Late payments are NOT ALWAYS a reason to get rid of a tenant

      • Past due balances are!

        • So, what was that amount typically and the pattern?

        • Paying late, but by the 2nd week of the month can be fine. Paying at the end of every month - NOT.

    • Everyone thinks PMCs should have ALL the solutions for everything and dump all blame on their PMCs!

      • Reality: NOBODY KNOWS EVERYTHING!

      • Owners must understand this and work with their PMC to solve problems together instead of playing the blame game.

      • Not sure how your PMC communicated to you what your options were to address the odor, how much research you did and how your PMC communicated they were out of ideas?

    • You don't mention any other issues with this PMC and it seems this long-term tenant was fine until the end. Same goes for the other unit that is occupied.

      • What would YOU have done differently if your PMC had told you at the last renewal that the tenant had 20 cats and there was a strong urine smell?

        • Would you have ignored/missed such a warning, just like you didn't review their inspection reports?

    This is a very unfortunate experience and an expensive lesson of being a landlord. It's obvious mistakes were made on both sides of the relationship and there could have been better communication.

    Not enough details though, to accurately assign faults to each party.

    [email protected]248-209-6824
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    • Steven Harris
      OP
      Member since 2026 · 5 posts · 4 votes
      1d

      What did the lease state about pets? No pets without a signed pet addendum and fees. The PM put its terms in writing on 8/4/2025: up to two cats, $500 fee plus $25 a month. A violation carries a pet violation fee, possible eviction, and the tenant pays for odor and damage remediation.

      When did you and the PM become aware of the cats, and that there were 20? Our realtors, late July or early August 2025, while at the unit for the sale listing. The 20+ is their count. PM staff walked the unit on 8/14/2025 at our request and recorded stray cats living under the house, a urine smell, "a few cats inside," teenagers feeding them, and cats entering through a broken window.

      How well did you review the self-inspections? What on them showed the cats? We did not know they were tenant self-inspections until July 2026. Nothing on them showed cats. The 5/8/2025 one rated every item Fair or Good and said nothing about cats or odor. The PM did not approve or post it until 11/21/2025, three months after its own inspector found the cats.

      What issues did the PM bring to your attention? Late payment only. The 5/16/2025 non-renewal recommendation was about rent, not condition.

      When were the inspections done? Should be 45–60 days before lease end. 6/7/2024 and 5/8/2025. The lease renewed 7/30/2025, so the 2025 one was about 12 weeks before renewal. The PM approved it six months after it was done.

      Why was your agent at the property in August 2025? We had listed the duplex for sale. The realtors were there for the listing.

      How long was the tenant in the unit? June 2023 to March 2026. The PM placed and screened her.

      What was the late-payment amount and pattern? Late most months from at least March 2024, but paid in full through November 2025. A $500 partial payment in January 2026, about $3,460 past due by mid-February, moved out in March owing about $4,400.

      How did the PM communicate your options on the odor? Each step came after we asked for a status: enzyme treatment, then a deodorizer, then the flooring we approved, then ozone twice. On 9/1/2026 the PM wrote that they were not sure what was still holding the smell. We found the chlorine dioxide vendor on 9/10.

      What would you have done if told at renewal that the tenant had 20 cats? Would you have missed that warning too? Not renewed, and enforced the pet terms. We never received a report that mentioned cats. A report that said cats would not have been missed.

      -Steven

      0Reply
  • Marc MoraPro Member
    Investor · Fort Lauderdale, FL · Member since 2026 · 203 posts · 28 votes
    3d

    @Steven Harris , let's connect. You're being pretty fair to yourself here. Keeping that tenant was your call, but a manager who let her do her own inspections left you with no eyes on the place for two years.

    Owning from out of state means trusting someone else's walk-throughs, so how involved you want to be from a distance probably decides what comes next. I know some people worth you talking to, happy to introduce you. Do you want to keep owning out of state?

    0Reply
  • Hajra Wajid
    Technology · Member since 2026 · 32 posts · 5 votes
    3d

    @Steven Harris one small data trick for the self-inspection problem..... When a tenant sends photos, ask for the original files and check the details. They show the date the photo was taken. Old photos reused from last year show up fast. For the ledger that hides payment dates, ask the PM for the payment export. Most PM software records the exact day each payment cleared. Put days late in one column per month..... that number started climbing long before anyone found the cats.

    0Reply
  • Denise SuppleeBusiness Member
    Realtor · Willow Grove, PA · Member since 2017 · 1k+ posts · 663 votes
    2d

    I think you have to separate the two issues. You made the decision to keep a tenant your PM recommended not renewing, so that part is on you. But I would question an “annual inspection” that was really done by the tenant on a phone app. If I'm paying a property manager, I want to know they're actually checking the property and following up on problems. I'd ask exactly what inspections are included, who does them, and how they're documented. And I'd review the reports instead of assuming everything is being handled. As for changing managers, I'd look beyond the 8% fee. If you don't trust the manager to protect the property, the cheaper manager may not be the cheaper option.

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  • Steve K.
    Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
    1d

    I would sell and buy in a better location, personally. Just sounds like a bad location.

    0Reply
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