2021 has been a tumultuous year for rental housing providers. Let’s hope that everyone stays safe, our community recoups a mountain of rent debt, and that the new Omicron variant does not prompt lawmakers from instituting more regulations.
In an annual tradition and drawing from what we learned the past year, here is what made our top ten list of resolutions for landlords and property managers to focus on.
I will create or fine-tune a tenant ledger that clearly notes when the rent became due, what the tenant paid, and document any communication about unpaid rent amounts.
When we ask our clients what is owed to them in terms of rent and other fees and dates on which rents became due, we are amazed that many of them do not have that accounting at their fingertips. We need this information in order to file an unlawful detainer (eviction action) and categorize rent owed during key dates.
If an application for rental assistance is denied and you are compelled to go to civil courts to recoup rent debt, a tidy accounting will also prove to be essential. Please get your financial house in order.
I will familiarize myself with proper rent increase amounts, consult an attorney before raising the rent, and if I have a vacant unit, I will “right-size” the rent amount.
Demanding an improper rent amount is a surefire way to tank an unlawful detainer action. If you have made improper rent increases, we have to forensically reel back the clock and deal with the improper rent increases.
If you have a vacant unit, please think smartly about setting the rent amount. Many overly optimistic rental property owners are waiting out the storm waiting for rents to surge and leaving a unit idle, or setting the rent too high on the market. While asking rents have been on the rise, they are just that – asking.
We can ask for a winning lottery ticket but it doesn’t mean we will get it. We would much rather prefer to be realistic and get cash flowing again, versus letting a rental unit languish on the market for months on end.
If I am renting out an unwarranted unit, I will look into pulling the proper permits and legalizing it. Buyers should also be wary.
For many landlords who are renting an illegal unit, the status quo may be perfectly fine. Yet if the rental relationship sours, the owner could face tremendous liability, especially if they have been collecting rent for many years.
Would-be buyers should likewise be cautious. There are many deceiving ads that advertise separate living quarters and the new owner can get a very unpleasant surprise when they find out the rental unit is not in good graces with the city, even if it is in perfect condition.
I will respond promptly to repair requests, document any response/outcome to the repair request, or risk losing an unlawful detainer action or lawsuit to recover rent debt.
Pandemic or not, rental housing providers are required to maintain the unit in habitable condition. Claiming the premises are not in liveable condition is a favorite defense of tenants’ attorneys. We want you to respond in a reasonable time frame to repair requests, prioritize those that render the unit inhabitable, and document everything. Notify the tenant in writing of any repairs made or if the repair is unnecessary, so apprise the tenant in writing.
I will update my stale notices and if a tenant makes a payment, will serve another 15-day notice for rent debt during certain time periods reflecting the payment and the new rent amount demanded.
In the eventuality we pursue an eviction action, we need to get the numbers right. If the landlord receives partial payment toward rent that is owed, serve another updated notice demanding a revised rent amount.
I will learn about the new laws coming into effect in 2022 that are germane to my real estate business.
Never in our legal careers have we been asked to digest so many new laws and edicts than during the long, dark winter of COVID, and there is a deluge of new laws that will go into effect in 2022. Follow us to stay in the know and/or join an industry trade group that is providing constant updates in an ever-changing regulatory regime.
I will look at my insurance coverage, ensure I am protected, and if I will seek/obtain wrongful eviction coverage if I don’t already have a wrongful eviction policy.
This may take a bit of shopping around. A standard homeowners policy will not cover a host of potential catastrophes. If you are renting an unwarranted unit or engaging in short-term rentals, be especially diligent.
I will not post any discriminatory rental ads.
Big brother is watching. So are enterprising attorneys looking to catch rental housing providers in the act of violating fair housing laws. Notably, in 2021, our firm defended against multiple lawsuits alleging discrimination against rental applicants with Section 8 vouchers. Please educate yourself and any employees or property managers on the language that is prohibited and what you can or cannot say when denying a tenancy.
Generally speaking, any preference for a certain group, or an exclusion of a particular group, will invite liability in an era when the number of “protected” classes is expanding and bottom-feeding attorneys are actively seeking landlords/property managers who blurt out statements that deny housing on illegal grounds.
I will consider a lease less than 12 months to be “under the radar” of AB 1482.
In 2020, we thought we would spend much of our time educating our community about the provisions of the Tenant Protection Act of 2019 (AB 1482). Then COVID reared its ugly head and the topic of statewide rent and eviction controls was put on the back burner.
A host of tenant protections go into effect only after the tenant has resided in the rental unit for 12 months or more. In a trial period, you can offer a 6, 9, or 10-month lease to new tenants in order to gauge the tenant’s excellence without being subject to statewide rent/eviction control and of course, renew the lease if, in fact, the rental relationship is going smoothly after this period.
This assumes that the rental unit is only subject to statewide rent control and not enveloped by stricter local protections. In many locales such as San Francisco and other jurisdictions that dictate minimum lease terms, you may not be able to avail this strategy. Be sure to contact an attorney before following through with this tip.
I will have a zero-tolerance for sexual harassment and educate my employees and agents on this difficult topic.
The #MeToo movement has rocked every facet of society and has trickled down to the rental housing industry. Please undergo training on what constitutes sexual harassment and require that employees or agents do so, as well.