Rental Property Inspection 101

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Whether you own an apartment building, rent your home to tenants, or temporarily offer your property to vacationers, it’s essential to conduct a thorough rental property inspection. This type of inspection comes in several forms, and it’s a crucial part of ensuring that your rental property is safe and adequately maintained. If you are a renter, you should also make sure that you perform a thorough inspection of the property before signing a rental agreement. This guide explores the importance of rental property inspections, what you need to look for, and how to perform one the right way so that you’re protected.

Rental Property Inspection Basics

Here is some important information regarding rental property inspections.

What are they? A rental property inspection can be performed by the owner, tenant, or both whenever they move in or out of the property. These inspections can also be performed by trained professionals, particularly when an insurance claim needs to be filed, the owner plans to sell the property, or a safety issue has been detected.

Why are these inspections necessary? It’s important to inspect the rental property before someone moves in to ensure that everything is safe and in good working order. Performing and documenting an inspection can also protect both the landlord and tenant from certain liabilities. Additionally, they give you a chance to identify problems before they get out of hand and turn into a costly issue.

Why are rental inspections an integral part of property management? If you own or manage property that you rent to tenants or guests, conducting a rental inspection can help to protect you in the event of an accident later. If the inspection comes back “clean” and no safety issues are noted, then the tenant may not be able to sue for damages if something happens later that was either not reported, or that occurred after the inspection took place. These inspections will also give your renters peace of mind before they move into their new homes. They may also be required by law or under some insurance plans.

Types of Inspections

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Rental property inspections come in several types, including:

Move-in inspections. Sometimes referred to as a “walkthrough,” move-in inspections occur with a tenant after signing the lease but before moving into the property. Use a checklist to verify the condition of the property, kitchen appliances, and other features. Sometimes, photos or videos are taken of the property to confirm the condition before the tenant moves in. Once the inspection is complete, the tenant signs the checklist and gets a copy for their reference. The checklist allows the landlord to charge the tenant for damages upon moving out if anything was not initially noted during the move-in inspection.

Quarterly inspections. Many rental property inspections are performed every few months to confirm that the property is in good condition. Some landlords perform these inspections if they’re concerned that the tenant is possibly violating the lease terms. Make it clear to your tenants that quarterly inspections will be completed as soon as they move in, so they are not caught by surprise. You’ll still need to get their permission before performing the inspection per local laws.

Drive-by inspections. Rental property management companies and landlords can do a drive-by inspection to visually check the outside of the property at different times of the day, week, or year. These inspections don’t require advance notice to the tenant since they’re done by simply walking or driving past the outside of the property. This is a good option if you’re concerned about activity occurring at certain times of the day or night. It gives you a chance to talk to the neighbors if you have concerns about crime, tenant activity, or even the condition of the building.

Move-out inspections. A move-out inspection occurs before the tenant officially moves out, and it gives the landlord a chance to take note of any damages to the property. The move-in inspection checklist will be used to make a side-by-side comparison of how the property looks now compared to when the tenant moved in. This inspection can be used to charge the tenant for repairs, which typically comes out of their rental deposit.

How to Perform a Rental Property Inspection

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Here are a few dos and don’ts to keep in mind when performing a rental property inspection.

DO

Give your tenant prior notice before you enter the property and let them know the reason why.

Schedule the inspection when the tenant will be home to point out items that may need repairing.

Give your tenant some tips about what they can do to ensure their security deposit is returned in full.

Explain why you are conducting a property inspection.

Take photos of the condition of the interior and exterior of the property.

Make personal notes of anything you see that concerns you and address them with the tenant later in writing.

Keep up with state and local laws regarding property inspections.

DON’T

Show up to your tenant’s apartment or property unannounced and without getting permission first.

Take photos of personal effects inside the property, including children, personal items, or pets.

Get angry with your tenant if you notice any damages. Instead, let them know politely that it may be taken out of their security deposit.

Make promises that everything will be fine regarding the security deposit if you see issues that will cost money to repair and correct.

Scold your tenant or make them feel bad about any damages you see. If the damage is extremely severe, talk to your tenant about your concerns in a professional, mature way.

The Ultimate Checklist

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Use this handy checklist to help you with your next rental property inspection.

Stocking key elements for vacation rentals. If you’re renting property for vacationers, make sure that each room has the essentials. This should include clean towels in the bathroom and small toiletries if you choose to provide them. Ensure all kitchen appliances are in working order and that the kitchen is stocked with pots, pans, silverware, dishes, and glasses. Make the bed with clean linens, including clean sheets, pillows, pillowcases, and blankets.

Additional elements to inspect. When performing a rental property inspection, don’t forget to check some additional items that pertain to the building as a whole. These items may affect the rate of insurance for rental properties. Look at the climate control system and make sure it’s working the way it should be. You should also confirm that there is an independent entrance and exit if you rent a multi-unit building. Do a check of the electrical installations in the building and the walls and ceilings just to ensure that everything looks to be in proper condition.

Safety items checklist. Don’t forget a few essential safety items, including verifying that the property has a working smoke detector and carbon monoxide detector. The kitchen should have at least one working fire extinguisher. A first aid kit isn’t mandatory for every unit, but having a fully stocked kit at the front desk or the main office is advisable. Finally, provide all of your tenants with an emergency number in case they need urgent help after hours.

Financial and legal checklist. Renting property as a means of investment requires sound financial knowledge. Ensure you keep all documentation in order and talk to a professional financial advisor about things like your rental property taxes and your monthly and annual profit. It’s also a good idea to consult with a lawyer who can put together a legal checklist so that you’re within the confines of your state and local laws regarding landlord and tenant relationships.

Insurance aspects of renting a property. Make sure that you have the right type of insurance coverage when renting a property. Unlike homeowner’s insurance, you will need to obtain a good landlord insurance policy. This policy will protect you and your property in the event of a fire, natural disaster, or another emergency. Most rental property insurance plans also cover some level of liability if your tenant becomes injured while living in your property. Talk to a professional insurance agent who can guide you through the ins and outs of this type of insurance.

Rental property inspections are an essential part of owning and renting your property to tenants and guests. Remember to do a move-in inspection before a tenant moves in, and feel free to perform quarterly inspections as needed. Move-out inspections are always highly recommended to protect your investment and make necessary repairs before a new tenant moves in. Re-inspections might be required if you are concerned about your property, so don’t hesitate to talk with your tenant and schedule them if you think you need to. Overall, performing a thorough rental property inspection is a smart way to protect you, your investment, and your tenants.