Tenant move-outs can be incredibly stressful: If vacating tenants leave the unit a mess, you run the risk of having the unit sit vacant while tending to maintenance and repairs. Not only can this be expensive, but it also means that the cash flow train grinds to a halt.
But the process doesn’t need to be stressful: If you’re able, you should prepare for turnover well in advance. And believe it or not, this means preparing for turnover before the tenants even move in!
Lease Language is Key
Experienced landlords know to put language in the original lease agreement that spells out who is responsible for what maintenance or repairs. For instance, most leases should spell out that tenants are in charge of the unit’s cleanliness and general upkeep (e.g. replacing light bulbs). The lease might also contain a policy for how and when the tenant should notify the landlord or property manager about necessary repairs that go above and beyond what a tenant is capable of (e.g. a leaky faucet).
The lease should also spell out how much notice tenants must provide when they plan to move out. This notification is important because it allows you to start looking for new tenants to replace the vacating one. Standard procedure is to request one to two months’ notice. If the lease expiration is closing in, remind tenants to give you notice one way or another.
Another key piece of information to include in the lease is exactly when the tenant is obligated to vacate the unit on the last day of the lease. Do they need to be out by 9am? By 12pm? By 3pm? You might even be willing to give tenants a partial rental credit for moving out earlier than 11:59pm on the last day of their lease. This specificity might not seem like a big deal initially, but setting clear expectations allows a landlord to line up a cleaning and maintenance crew immediately after the tenant leaves in order to allow new tenants to move in the following day—thereby avoiding any gap in tenancy.
Create a Maintenance Plan
One of the most common reasons dissatisfied tenants leave a rental property is because a landlord fails to maintain the unit, or fails to respond to requests for maintenance in a timely fashion. Combat this by creating a maintenance plan, or a system for promptly addressing maintenance issues.
A good maintenance plan includes regularly scheduled property inspections. The frequency of these inspections can vary depending on the location, type, age and condition of the rental property, but should be performed at least annually and again upon tenant turnover. Exterior inspections might occur more frequently, perhaps bi-annually, since these are less intrusive to tenants.
Of course, a landlord’s ability to follow through on the maintenance plan is partially dependent upon a tenant’s willingness to grant access to the interior. Once again, this is where lease language is important. Leases should contain a clause to allow the landlord, or an agent on his behalf (like a property manager), the right of entry for an annual property inspection or walk-through. Most tenants cooperate fully, but a few states prohibit landlords from entering just to inspect the unit without the tenant’s advanced permission. Try to give tenants as much notice as possible (24 hours at a minimum). Send a friendly letter to tenants reminding them about the inspection and include a maintenance checklist. This policy can protect you from claims of poor maintenance, brings attention to repairs that may be needed, and keeps good tenants satisfied.
Establish Move-Out Guidelines
About a month or two before tenants are scheduled to move out, give them a list of your expectations. For example, you might want the unit cleaned from top to bottom, including the refrigerator, stove and carpets. Stipulate what the cost will be if you are required to hire a cleaning company (usually anywhere from $100-$250, depending on the condition of the unit).
If you allowed the tenant to paint the walls, you should specify whether they are required to paint the walls to their original color—and who is responsible for the cost of paint. Just be aware that not all tenants have the best painting skills; you might suggest having your property manager repaint the unit and deduct that expense from the tenant’s security deposit. Either way, reach consensus about the strategy in advance. Filling holes in the walls and taking out the trash are other items that should be included in a move-out checklist.
Conduct a Final Inspection
As we noted in a recent article on security deposits, it’s usually a good idea to conduct a walk-through of the unit with the tenant if they are still available to do so. Walking through the unit together can help prevent any future security deposit disputes. Even better, if you’re able to do a preliminary inspection with tenants, this gives you an opportunity to point things out to the tenants and give them an opportunity to remedy the situation before they move out and risk losing a portion of their security deposit. This also works to the landlord’s behalf because it means less time is spent cleaning and repairing things between tenants, and it gives the landlord an idea of what repairs they may be obligated to tend to once the tenant vacates. Use the Statement of Conditions form the tenants filled out at the beginning of the lease as a benchmark for pre-existing versus current conditions.
When a tenant finally moves out of the property, be sure to promptly inspect the unit for any damage. If you’re holding a refundable security deposit, most states require you to notify tenants’ of any claims against that deposit within 30 days. Double check state laws to ensure compliance. And of course, if you aren’t making a claim against the security deposit, be sure to return the full amount accordingly and in a timely fashion (again, as outlined by local regulations).
Take Care of Post-Move Out Responsibilities
One of the final steps upon tenant turnover is changing the locks and having new keys made for future tenants. If a new tenant is not moving in right away, it is the landlord’s responsibility to care for the unit. Utilities should be put in your name if they aren’t already. If lawn care was the tenant’s responsibility, be sure you or your property manager is maintaining upkeep. Keeping the rental property in pristine condition will help rent the unit out faster than allowing the property to fall into a state of disrepair.
Tenant turnover is inevitable. Make sure the process is as smooth as possible by following the steps outlined above. You will have more experience with the move-out process than most tenants—if you’re willing to do a little hand-holding, it can help the relationship end on a high note.
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