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05/09/2019

Expensive Pitfalls When Trying to Self-Manage Your Rental Properties-2019

Water Flood in Condo Building

Damage To Your Residence And Adjacent Residences

  • Insurance companies look for ways NOT to pay claims so if you fail to follow a strict protocol for remediation, the insurance company will deny your claim. We have witnessed water events where damages exceeded $1mm. Trying to save money by self-managing can be the most expensive decision you can make.

Housing Discrimination

  • There are seven different protected classes in real estate, and penalties for violations start at $16,000. A seemingly innocent comment can lead to Fair Housing complaints, litigation, and lawyers are now targeting our industry.

Repairs, Maintenance, and Working with Contractors

  • A tenant can sue you for a partial refund of past rental deposits, and in some circumstances can sue for discomfort, annoyance, and emotional distress caused by substandard conditions.
  • You are prohibited from employing certain types of contractors, and many communities and condominium projects have specific licensing and insurance requirements for contractors.
  • Contractors can be unreliable, and overcharging when dealing with out-of-state landlords is common. We are often high-rise contactor’s largest business account so you will benefit from our purchasing power and influence.
  • Mold can form in as little as 48 hours. If you fail to act promptly, it will result in costly litigation and a denial by your insurance provider.

Time is Money

  • In addition to paying premiums on repairs, the timelines can be exacerbated. A project that could take LRA two weeks to complete could take you two months. If we factor a rent of $5,000/month, vacancy costs total $166/day.

Implied Warranty of Habitability To Tenants

  • There are specific timelines in which repairs need to be made to avoid penalties and litigation.

Security Deposits

  • There is a limit to the amount you can request for security deposits.
  • There are specific laws and timelines related to retaining/refunding deposits.
  • You may not retain deposits for wear and tear; however this provision is objective so withholding deposits for wear and tear can still end up in a legal dispute if the tenant disagrees with your findings.

You Are Liable For Crimes Originating From Your Investment Property

  • There is a case in the Eighth District Court where a Bay Area landlord failed to enforce lease terms regarding crime originating from their rental property which resulted in a shooting at a nearby home. The landlord and HOA are all named parties in the law suite, and there is a high probability that the landlord will lose all of their investment properties to judgment.

Our team will inspect residences and diligently follow upon HOA violations and evict when applicable to limit your risk.  

Eviction Processes

  • You must know the steps for notifications, methods, and timelines to evict a tenant legally.
  • You have an obligation to understand specific rules regarding the disposal of items left behind by tenants.
  • If you fail to follow statutes outlined in NRS 118A, litigation is likely.

NRS 118a governs landlord/tenant regulations and includes 20 pages with 13,024 words of the legal language; we have a detailed understanding of these regulations, so you don’t have to.

The team at Luxury Real Estate Management can minimize the risks associated with investment property landlord/tenant issues and save you money via our preferred contractors. Contact us today for more information. 702.482.8885 or [email protected]

Lux Advisors Sales | Property Management
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