Useful Life And Property Damage

It’s a situation that is all too common in residential property management. Move-out day finally arrives. The tenant has vacated the property and you’re ready to complete the move-out inspection. You open the door and stop, mouth agape. It’s dirty. The carpet and paint are damaged. You’re frustrated, but console yourself with the thought that the tenant is responsible for all of the damage.

Or are they?

The answer may depend on how old the item is.

Useful Life Expectancy

 

One fact that many first-time landlords forget is the rule of useful life when assessing property damage. If an item has exceeded its useful life expectancy, odds are you won’t be able to hold the tenant responsible for the repairs. Many courts will rule in favor of the tenant in these situations. If that happens, you’re out the cost of the repairs and potentially triple the amount you charged the tenant for wrongfully withholding from their deposit. This is where hiring a property management company comes in handy.

So what exactly is useful life? It’s essential exactly what it says: “the amount of time during which an item is considered good enough to use.” Every item in a home has a useful life expectancy. Carpet, paint and appliances all wear down over time with normal usage. And with a rental property, the standard number of years can be different given the increased number of occupants coming and going. This means that if an item exceeds its useful life expectancy, charging the tenant for the repairs may not be an option.

 

Solutions

 

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So what is the best course of action for landlords? Property inspections and evaluations are #1. Monitoring the condition of the interior of your rental property on a regular basis can help catch potential problems ahead of time and create a timeline for how items are wearing down. Keep track of when you last replaced certain items and make a schedule for when those items need to be replaced based on their useful life expectancy. A rental is an investment, which means you have to continue to put money into it to get a good return. Lastly, hire a property management company like Real Property Management Colorado to manage your rental for you. We have all the experience, knowledge and resources to expertly manage your investment property and guide you on the road to successfully navigating useful life and property damage.