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When You Should Compensate Your Tenants

Hanover County Woman Calling Landlord about Roof Leakage ProblemMostly, tenants are the ones paying for the right to live in your rental property. However, there are times when a Hanover County property manager may wish or need to compensate a tenant. When certain issues arise, you may find yourself in the unusual situation of paying your tenants instead of the other way around. To be as prepared as possible, it is important to know what circumstances may result in tenant compensation and when and where you should offer it.

Tenant Compensation and the Law

The question of tenant compensation founds almost entirely from landlord/tenant laws. As a property owner, you are in charge of guaranteeing that your rental house is in a habitable condition. On the whole, this implies that your rental home is clean and livable. It also entails that your roof keeps the house dry and that the appliances and other elements work correctly. When the property isn’t habitable, for one reason or another, that can bring about situations where a tenant may be compensated.

Reasons to Compensate a Tenant

Some of the most prevalent reasons that a property owner may need to compensate a tenant include the following:

Repairs. One of the most common factors a property owner would need to compensate a tenant is because of repairs. In some cases, a property owner may find it difficult to make vital repairs right away. Whether you are out of town or otherwise unavailable, if something breaks and causes your tenants to lose the quiet enjoyment of the rental house, you should restore it. If you are incapable of doing so, your tenant may have the repairs performed within the confines of state law. It’s great if the tenant asks your permission first, but even if they don’t, the odds are that you’ll have to reimburse your tenant for the cost of repairs if they follow the state requirements.

Broken appliances. Sometimes compensation comes up in arguments about the condition and functionality of appliances. Failing to accept responsibility for broken appliances is one of the main reasons a property owner gets sued by their tenants. A portion of this is because the issue is more complex than it first appears. Landlords sometimes argue that a broken dishwasher, while inconvenient, does not make the entire property uninhabitable. At the same instant, a damaged oven or refrigerator is thought to be a major concern, and tenants may argue that the home is uninhabitable. Imagine you have provided appliances with the rental house. If one of them malfunctions, and you can’t repair or replace it instantly, your tenant may be warranted in repairing the machine and deducting the amount from the rent, as prescribed in your state’s landlord/tenant law. This is particularly true if your lease documents assign responsibility for the appliances to you as the property owner.

Cash for keys. At times, a property owner may ask a tenant to vacate a property before the lease ends. In other situations, a landlord may offer to pay the tenant to move out. Property owners sometimes use this technique to avoid a drawn-out eviction process and encourage a problematic tenant to move on sooner than later. Considering how long it takes to evict a tenant and that you probably won’t be collecting rent during eviction proceedings, attempting to pay them to move may save you money in the long run.

Even though the most typical, these are not the only reasons you may need to compensate a tenant. Yet, whenever you find yourself in a position where payment is needed, it is critical to document everything meticulously and issue the funds on time. If you are pro-rating a rent payment, remember to record it and notify your tenant in writing. If you should send payment to your tenant directly, use a method that delivers a paper trail, such as a business check.

While landlord/tenant laws vary from place to place, staying on top of tenant compensation is important in sustaining excellent tenant relations. As a Hanover County property owner, you’ll need a comprehensive understanding of the landlord/tenant laws that oversee compensation to guarantee that you are in full compliance. Real Property Management Richmond Metro can help you prepare a lease to cover these issues or even manage your property entirely. Contact us today to get started.


Originally published on October 9, 2020

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