Passive income, tax benefits, and asset appreciation are some of the pros of being a landlord. There are so many that around 10.3 million people report owning rental properties.
However, it is not all sunshine and rainbows with rental property management. It requires plenty of hard work, time, effort, and, of course, handling repairs.
But who should pay for restorations? Tenants, landlords, or a property management company?
Read our in-depth guide to uncover everything you need to know about this heated topic!
Lease Agreement Terms
Around 43 million people rent a home in the United States. Each has a lease agreement, and no two will be alike.
This binding contract outlines the rights and obligations of the landlord and tenant. In Atlanta, these agreements typically detail who is responsible for specific repairs.
Landlords may include clauses specifying tenant responsibilities for minor repairs. On the other hand, major structural issues and system failures often fall on the landlord.
The general rule is that landlords will spend 1% of their revenue on maintenance. So, saving between 1.5% and 2% will give you breathing space for all types of rental property repairs.
Most major repairs will fall under the jurisdiction of the homeowner. Plumbing, electricity, air conditioning, and heating systems are some of the most critical. You must provide your guests with a safe space with all the necessities.
Remember that you will not be liable if a tenant misuses these items. This is one of the reasons why home inspections are critical.
Of course, whatever is signed in the contract falls under the renter's responsibility. Nevertheless, there are still some items that traditionally fall under the tenant category.
Tenants are often liable for minor rental property maintenance. This includes unblocking drains, replacing air filters, and cleaning the property. In addition, any damage caused by the tenants should be dealt with themselves.
Be sure to cover as many details as possible in your lease. Otherwise, it can lead to simple misunderstandings or unfortunate legal problems.
Rental Property Company Responsibilities
Research shows that about 44% of people use a property management company. One of the many reasons managers are so popular is that they act as intermediaries between tenants and landlords.
Although a property manager organizes the process, they usually don't pay for repairs. However, there are vital factors in the procedure that they handle, such as:
- Coordinating maintenance checks
- Hiring contractors
- Ensuring repairs are completed
- Tenant education
Emergency Repairs and Maintenance
Unfortunately, emergencies can happen to anyone at any time. Parties are often confused about who should cover the costs.
If you hire a property manager, they will be in charge of overseeing the issue. However, the costs incurred for emergency repairs are typically the landlord's responsibility. Details may vary based on the specific terms negotiated in the lease.
Consider Rental Property Management in Atlanta, GA
One of the most asked questions in the real estate industry is, "Who pays for repairs?" After reading our guide, you realize this isn't a straightforward answer. Yet you did learn who should pay for what issues and how a rental property management firm plays its part.
Do you want to work with owners with two decades of experience and in-depth local knowledge to help overcome this issue?
If so, discover PMI Georgia's property management service today!