When talking to a potential client, we are often asked, “Do you charge a tenant for a repair deductible when they submit a maintenance request?” The simple answer is “NO!” - here‘s why repair deductibles actually do more harm to the preservation of your rental property than they do good.
Benefits to forgoing the repair deductible:
Preservation of your investment.
The idea of repair deductible is great. The purpose is to
prevent a tenant from calling frequently about frivolous issues such as burnt
out light bulbs or loose door handles. However, what actually ends up happening
is that the tenant will see something like a small drip under the sink and will
put off reporting it to the landlord to prevent being charged the repair
deductible. What was originally a small drip that could have been easily
repaired with a service call by the plumber has now turned into a cabinet replacement
and possible mold concerns from the ongoing leak that was never initially
reported. The simple solution: don’t give the tenant a reason not to report the
problem!
The tenant is basically the grounds-keeper of your property.
They are there almost every day to keep an eye on the day-to-day functionality
of your investment and when something goes wrong, you want them to let you
know! Having an effective property manager to sort out the frivolous calls will
prevent you from spending unnecessary repair dollars, and in turn, alleviating the
concern that drove you to the repair deductible in the first place. It is important to mention that excluding the
repair-deductible requirement from your lease does not open you up to paying
for damage caused by the tenant. If you send a plumber out to repair a garbage disposal
and they find broken glass inside to be the cause of the failure, your tenant should
still be held financially-responsible for the cost.
I can’t say this enough: It is important that the landlord
maintains an open line of communication with the tenant in order to ensure the
preservation of the investment. No one likes to get a maintenance call, but it is
what we sign up for when we purchase as rental property.
Increased
desirability to potential renters.
When a potential renter is choosing between similar properties,
one having a rent deductible and the other not, which do you think they’ll
choose? Ensuring the tenant that they will not be held responsible for normal
maintenance/repairs of the house will give them peace-of-mind and will make
your property more marketable.
Positive tenant-landlord relationship.
The tenant will appreciate not having the feeling of being nickel-and-dimed
at every turn during their residency. While the allure of having extra cash to
reduce your maintenance expense is tempting, a good landlord will think
long-term and know that the tenant will end up staying longer in a home where
they aren’t charged every time there is a common repair.
SUMMARY: The
imposition of a repair deductible will make the event of a preventable and expensive
maintenance nightmare much more likely. Keeping an open line of communication
with your tenant will not only prevent small issues from becoming expensive ones,
but it will also strengthen the relationship with your tenant and will result
in a much more positive experience overall.
Lauren Ford
Lauren Ford
Advanced Property Management, Inc.
