Thoughts from 2014: Thinking of renting out that old backhouse for extra money? Before you do, there are a few things you need to know, before you end up with tenants like these!
Thinking about renting out a property you own? While rental properties can be a nice way to earn some extra cash, they also come with some specific responsibilities and expenses a new renter needs to know about. As the owner of the property, you become a Landlord and the individual you rent your property to, is your Tenant. Before renting, certain security precautions need to be implemented by the time the Tenant takes possession to be up-to-date with the law: window latches on all exterior windows, doorknob locks or keyed deadbolts, a pin lock for sliding glass doors, a keyless bolting device, and a door viewer on each exterior door are all required. Further, Texas law requires there to be hot water and smoke alarms installed and in working order.
After the property is ready for a Tenant to move in, it’s important to set out a written contract between the Landlord (you) and the Tenant. A written contract, typically called a “lease,” allows the parties to understand both side’s responsibilities and expectations. The most common type of lease is for a term of years, or just one year. This lease should specify that a Tenant is liable for the entire year’s worth of rent. If a Tenant breaks his or her lease, the Landlord has a duty to mitigate if he can. Mitigate means that the Landlord should attempt to find a new Tenant to take over the lease term that the original Tenant walked out on. This term may be more difficult to complete if the Landlord is not a rental company and just an individual; however, the Landlord must only attempt to find a new Tenant, he is not required to find another Tenant.
If the Tenant refuses to pay owed rent for any reason, the Landlord is entitled to all of the rent owed for the year. However, there are a few exceptions where the Tenant has the right to break the contract between the two parties. One of these examples is if the Landlord has allowed the condition of the Tenant’s premises to deteriorate to the point that the Tenant is essentially being forced out. If the deteriorating condition is something caused by a third party, such as a maintenance man accidentally flooding the premises, the Landlord is only liable if he should have reason to know of the flooding. Therefore, it is the Tenant’s responsibility to inform the Landlord. To not have to pay rent, the Tenant must move out. If he can still live on part of the premises, he is allowed to stay and will be able to get a discount in his next rent until the problem is fixed. Other than keeping the premises livable, the Landlord is also responsible for disclosing known defects to the Tenant, maintaining common areas, and repairing problems that are not ordinary wear and tear.
Now that you know your responsibilities as a new Landlord, let’s do a quick recap: (1) the Landlord must equip the premises with safety precautions prior to Tenant move-in; (2) the contract between the two parties lays out the responsibilities and expenses of each party; and (3) the Landlord must keep the premises livable and in good repair. Having more problems with your Tenant than you anticipated? Check out our other article on what to do if your Tenant refuses to leave and pay rent!