Thank you @Steve Babiak and @Bill Gulley for your insight and replies. Really each case is unique. Sure is important to set up clear expectations with the tenant in the beginning.
I've done that for some things, such as giving the tenant a new cutting board at move-in and having instructions in the property rules about proper use of cutting boards and care of counter tops. If it is a new countertop or doesn't have previous cut marks and they mess with it, well... they were forewarned.
The 18 inch cut in the middle of the vinyl flooring is also serious and not W&T. Can the next tenant live with it or do we need to replace the floor covering...hmmm. Same with carpet stains. Ours are not high end properties, so usually I wait until I hit "critical mass" of wear or damage before I tear out floor covering because it is such a big expense, considering the cost of labor & materials plus the extra time it takes to turnover the unit.
The most painful for me is the first chip, the first scratch, the first ding, the first nail in woodwork and cabinets, the first cut, the first tear, the first stain. Just like with a new car. :-)
I was just scouring the internet for some more ideas and came across a form on DocStoc.com that I like called "Minimum Charges for Services and Turnover Costs" that the tenant agrees to at the start of the tenancy. I plan to modify it for my own future use.
I have been charging $10 per inch on cracks in fridge plastic, cuts in flooring, new chips on tubs/sinks/appliances, for the diameter of carpet stains, and per nail hole in finished woodwork. That's if I decide to keep the item in service. It's been working pretty well and the tenants seem to think it's fair. May have been selling myself short though. Never been to court for this, so I don't know what a judge would say.
For items that are missing or need total replacement or can be repaired to original standards, it is so much easier to find the value. I document well with move-in check lists and photos before & after. I also try to get the tenant to be present for the inspection and ask them what they think a fair price would be for the damage and see what they say. It's a good starting point for negotiation.
Most often I am able to return the full security deposit, or most of it. Especially if I have addressed damages as they happen during the tenancy. Upon move-out, the few times I've struggled with writing up the "final report on return of deposit" were with cases where the tenant created significant damage and chose not to do a move-out walk through with me. Usually those cases involve big ticket items. Like a case I'm working on now.
Again thank you Bill and Steve for answering my question. It was helpful.
