Skip to Content

10 Property Management Rules to Avoid Legal Problems

You’ve heard the old adage: hope for the best, and prepare for the worst. When it comes to investing in rentals, most property owners are great at hoping for the best but then they forget the rest. Now more than ever, if you own rental property without preparing for the many potential legal pitfalls associated with your investment, the risks can really cost you. With typical lawyers’ fees at over $250 per hour, a single legal issue can wipe out the entire annual profit from a rental property. With almost 30 years of experience in this industry, no one knows better how to reduce risk than Real Property Management. Here are the ten ways to prepare yourself, protect yourself, and do your best to avoid legal hassles as a landlord.

  1. BE ACCOMODATING The Americans with Disabilities Act requires that you not discriminate against potential tenants with disabilities and that you allow the tenant to install adequate access features, but you can also require them to put the property back to its original condition. Plus, you may never restrict or charge for service animals. So BE ACCOMODATING.
  2. BE FAIR The Fair Housing Act—and common decency—prevent property owners from making housing decisions based on race, color, sex, national origin, religion, handicap or familial status. States and localities can add additional protected classes and violations can cost tens of thousands of dollars, so ensure that you BE FAIR.
  3. BE SAFE Habitability laws vary from region to region and require that your rental property provide a safe, comfortable living environment for tenants. [Text: Protection from the elements, running water, plumbing, heating, electricity, freedom from noxious smells, mold, noise and garbage, functioning smoke and carbon monoxide detectors]. If you neglect these items, respond slowly or ineffectively, or require tenants to pay for them, you can end up with landlord-tenant disputes, lawsuits or costly government actions, so BE SAFE.
  4. BE CONSCIENTIOUS Some inexperienced property owners may try to cut costs by making repairs themselves or hiring unlicensed labor. Most states require licensing along with minimum liability and workers’ compensation insurance policies. Shoddy repairs—or worse, the injury of an unlicensed repair person—can lead to very costly lawsuits. So BE CONSCIENTIOUS and hire only licensed and insured service personnel.
  5. BE LICENSED Many aspects of property management are often regulated as well. Conducting activities that are only to be conducted by a licensed real estate agent can lead to costly fines, so BE LICENSED.
  6. BE AVAILABLE It is essential that you respond promptly to urgent calls and maintenance requests to avoid liability. Maintaining a dedicated 24 hour contact system able to handle after-hours, weekend, and holiday emergencies is the best way to ensure you BE AVAILABLE.
  7. BE DILIGENT Some of the heftiest fines are imposed for improperly handling security deposits and other funds in violation of trust accounting and other laws. Violations of these laws can cost up to three times the security deposit if handled incorrectly, so be BE DILIGENT.
  8. BE ACCOUNTABLE You are best protected when you keep accurate records of all tenant requests, including when and how you responded. This is the primary source of “reliable” information in litigation, so securely keep date- and time-stamped records of all communication, service and financial transactions for the full length of time your state statues require, and BE ACCOUNTABLE.
  9. BE TRUSTWORTHY As a property owner, you have access to the personal information of your tenants, and you are required to keep that information secure. Failing to keep this private data confidential both in what you share personally and in how you store your records can open you up to liability, so BE TRUSTWORTHY.
  10. BE KNOWLEDGEABLE Put simply, rental property owners must get—and stay—current on all federal, state, local and industry laws, codes and regulations to avoid litigation, liability and expense. It is critical that you, or your professional property manager, remain constantly vigilant and current on all applicable requirements to help you avoid some very costly mistakes, so BE—and STAY—KNOWLEDGEABLE.

Most property owners don’t have the time or interest to stay on top of it all in order to protect themselves. That’s why your compliance team at Real Property Management helps protect you with impeccable integrity, a proven system and local regulatory expertise that reduces your risk. Put our experienced team and proven process to work for you. Call Real Property Management West San Fernando Valley at 818.727.0100 today!

We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.

The Neighborly Done Right Promise

The Neighborly Done Right Promise ® delivered by Real Property Management, a proud Neighborly company

When it comes to finding the right property manager for your investment property, you want to know that they stand behind their work and get the job done right – the first time. At Real Property Management we have the expertise, technology, and systems to manage your property the right way. We work hard to optimize your return on investment while preserving your asset and giving you peace of mind. Our highly trained and skilled team works hard so you can be sure your property's management will be Done Right.

Canada excluded. Services performed by independently owned and operated franchises.

See Full Details