Why I Never Do Move-out Walk-throughs with Departing Tenants

by Steve Crossland, REALTOR in Austin TX on May 27, 2009 · 66 comments

I recently had a tenant express frustration over the fact that I wouldn’t come meet him to conduct a final move-out walk-through at the rental property. I’ve been moving tenants in and out of Austin rental homes since 1990, and I’ve learned a few lessons in doing so. One is that there is no upside for a landlord in conducting a final walk-through with a tenant. Only bad outcomes can occur.

Namely, the tenant is going to want you to affirm or state that everything looks “ok” and that they’ll get all of their deposit back. Nowhere in Texas Property Code is this sort of “instant accounting” required. You’d be a fool to agree to say something like that, because a lot of possible damage is not discernible on a cursory walk-through.

Just a few examples off the top of my head are fleas that haven’t hatched yet, carpet stains that were scrubbed invisible that morning but will re-appear tomorrow, the dirty A/C filter your HVAC guy could find sucked up into air intake cavity (as I encountered last month), pet odors that are masked at walk-through but which return in a couple of days, the cat hair blanketing the refrigerator coil, and a long list of other possibilities.

Therefore, even if I wanted to, even if the place appeared to be in great condition with no visible problems, there is nothing I could or would say to a tenant with regard to whether the home “passes” inspection or not. The reason the tenant wants the walk-through – to receive assurances – simply can’t and won’t be provided.

And then, as I learned in the old days when I thought it made sense to do a move-out walk through, an argument ensues. So I just don’t go there anymore.

To better and more fully see my position, there are a few things one must understand.

First, as a Property Manager and Agent, I work for and represent property owners, not tenants. I therefore have a fiduciary duty to protect the interests of my owners by not committing errors in judgment that increase the owner’s legal exposure and potential liability.

Second, Landlords, as a business class, are sued more than any other type of defendant in small claims courts in America. Most of these lawsuits are about deposits and deductions that were made after move-out. Knowing that, a prudent landlord will always operate from a careful defensive position, remaining fair to the tenant, but not accommodating risky requests such as personal move-out walk-throughs.

The best defense against lawsuits is a well documented  accounting of what the specific deductions were and why the deductions were fair and justifiable.

The best way to end up with that type of documented paper trail, which can easily be handed to a JP Court Judge as evidence, is to employ a consistent and static turnover process that removes as many variables as possible. Of the many different variables a landlord might have to contend with in defending legitimate deposit deductions for damages and/or cleaning, the very worst and most problematic ones are the “He said, She said” type, where the landlord is placed in a position of having to refute things that in fact were never said, or that are being mischaracterized by the tenant.

And, finally, the best way to avoid “He said, She said” debates, is to simply not say anything in the first place. Instead, reduce all communications to documented written steps and stages so that when (not if) you do end up in court someday with a tenant, you have a nice packet of printed and easy to understand paper trail evidence that represents all communication that took place.

The very dumbest, worst thing a landlord can do is spend 30 minutes or so walking around a house with a departing tenant, trying to respond to comments/questions from the tenant such as “does everything look ok”? “So, we’ll be getting all of our deposit back”? “When will we be getting the deposit”? And my favorite, “it’s cleaner than when we moved in, so we expect all of our deposit back”. You have lost control of the entire process as soon as you allow that to happen, and you have to assume that every utterance you make can and will be misconstrued and mischaracterized later if you end up in court. So just don’t go there.

I’ve accounted back the deposit for thousands of tenants in almost 20 years of owning and managing rental homes in Austin. I’ve been to court a total of three four times and have prevailed 100% each time. No tenant has ever convinced a judge that I’ve ever done anything wrong. My process works for me and protects my owners.

A Well Documented Turnover Process
The turnover process begins at the moment written notice to vacate is received from or provided to a tenant. Instantly, upon receiving a move-out notice, I mail to our tenants a two page set of instructions documenting everything they need to know and do in order to have a successful departure and deposit refund.
Move-out Acknowledgment and Instructions

This sets expectations and clarifies for the tenant what was agreed to in the lease agreement and the process that will be followed.

After the tenant’s departure, I walk through the vacant property and check it out. Then I have a 150+ point preventative maintenance checklist that will be conducted and which will reveal problems or issues not readily apparent during a cursory walk-through. Only after this full and thorough evaluation of the property can a final assessment be made as to whether or not tenant damages exist that will be charged to the tenant deposit.

Conclusion: You control the process, not the tenant. Don’t have casual conversations about the deposit or condition of the property. Don’t attend a final walk-through. The tenant is free to take hundreds of digital photos, videotape, etc. if they want to document the final condition. You don’t need to be there. Keep everything in writing, stick to the process and don’t subject yourself to exposure or risk that Texas Property Code does not require of you.

Finally, be fair with the deposit, don’t be greedy or heavy handed. Be firm but fair. Remember you might end up in court defending yourself and judges do give the benefit of doubt to tenants. Don’t be an idiot and get dragged into court over something that could have been avoided had you not been petty or greedy.

{ 64 comments… read them below or add one }

1 muzzie k June 3, 2009 at 10:19 am

You’ve got a typo in 3rd para 1st line on ‘why I never do a move out walkthough.

‘flaes’ s/b FLAWS

2 lenny June 3, 2009 at 9:57 pm

i just ran this articel though words spellig check… it turnd up 5 mis-speled words…

soon as i have the time.. i’ll run the rest of steves blogs… i shudder at wehat might come up…

3 Roxanne June 30, 2009 at 3:15 pm

Though I agree that a walk-through should never be about confirming the return of a deposit, I have to disagree that they are not important enough to push through. Instate a policy about discussing the deposit during the walk-though if you must.

The walk through should not be a time for the tenant to get the landlord’s approval. It should be a time to 1) discuss any problems that have not yet been addressed or have been discovered during cleaning and 2) for the landlord to point out to the tenant anything that the latter might have missed but would drain the deposit. That is, it’s a final chance to bring it up to the landlord’s standards. What is very obvious to you as a landlord, a tenant might be completely oblivious to.

In my state, CA, (and my previous state in New England), a final walk-through is a legal requirement.

4 Steve Crossland July 3, 2009 at 10:52 am

> That is, it’s a final chance to bring it up to the landlord’s standards.

Hi Roxanne, unfortunately I can say without reservation that such an accommodation would result in nothing but trouble for a landlord. It’s human nature to debate and argue. A 2nd chance would turn into a third, and this would be a no-win for the landlord.

Most of the failed move-outs I see are not even close calls either. They are home that have obviously received little to no effort.

On the sales side we have the same problem, though sellers usually do a pretty good job of leaving a clean home for the new owner to move into. Nevertheless, we write into all sales contracts for buyers that “seller to have home and carpets professionally cleaned prior to closing”.

Steve

5 Gina Johnson July 22, 2009 at 9:15 pm

Wow. If a carpet stain is scrubbed invisible one day only to reappear after the tenant has moved out, it could safely be assumed that “you”or your guest made the stains, not the tenant.

I am a landlord and as such have to say that your “faulty logic” gives us all a bad rap. I will always give the tenant an opportunity to accompany me on my final walk-thru. What’s there to hide from the tenant? Be thorough and you won’t need to do anything on the sly.

6 Steve Crossland July 23, 2009 at 8:30 am

Hi Gina,

Thanks for your comments. Check with your carpet person about the issue of returning stains. This is a common, known problem.

You are free to run your landlord business as you see fit, and I won’t argue with you. I can promise that your method, if applied to 2,000+ move-outs, would cause major headaches and you’d soon change your mind. Dealing with one property and a move-out every 2 or 3 years won’t expose you fully to the validity of the rationale, until you encounter that one pita tenant who changes your views (and your policies) forever.

Good luck on your walk-throughs!

Steve

7 Mary October 1, 2009 at 6:09 pm

I so understand your thought process. I’ve been doing final walk throughs and it becomes an argument. Tenants are ticked off when I point out things that are not done and the argument begins. Stress that I do not need…
I never used to do them and then started for some reason. Perhaps I read that I had too. My property is in Minnesota. Does anyone know if I have too? I’m sick of it and I don’t care to do final walk throughs anymore. My lease is very clear about my expectations and I am very clear when tenants move in.

8 Steve Crossland October 7, 2009 at 8:31 am

Hi Mary,

> My property is in Minnesota. Does anyone know if I have too (attend walk-through)?

Check your state/local laws/ordinances. You could probably just call a NARPM property manager and ask. http://www.narpm.org.

Thanks for your comment.

Steve

9 Joey February 9, 2011 at 7:26 am

Wow, Steve. You read my mind. I’ve only done walkthroughs a few times, but that limited experience has told me I simply don’t want to do them, EVER.

Every time, tenants argue about everything. EVERYTHING. They throw every excuse in the book at me. They say ANYTHING. I was about to undertake the policy of refusing to do it simply because I do not want the agony of dealing with a 30-60 minute argument over something that is, inherently, not subjective:

1) Was it there when you moved in?
2) Does it fall under the definition of “reasonable wear and tear”?

No, and no? Simple. You get billed. Shut up.

It seems like renters often are people who are incapable of reading or understanding leases, and beyond that, are people who are incapable of grasping a basic sense of responsibility for what they’re paying for. I think that they think I’m getting rich off of them, but they don’t see the cost of vacancy, repairs, updates, and property tax.

10 Steve Crossland, Austin REALTOR February 16, 2011 at 8:15 pm

Hi Joey,

Thanks for the vote of understanding! Sounds like you’ve “been there, done that”.

Steve

11 jkcoast June 28, 2011 at 10:59 am

I only wish I would have seen this article a month ago!! My husband and I are military and are renting our house in Texas out to other military… I recently check out the second set of renters we have had, yikes!! they were given a copy of the cleaning list when they moved in so that they could use it as a reference for filling out the move-in condition sheet and where told that those where the things we would be looking for when they moved out, I also gave them a copy the day after they gave us their 30 day move-out notice and told them that they needed to have all of it done before the walk-thru and they even had two extra days to complete everything. When I began the walk-thru (the first one I had ever done, the first renters we had left before the walk-thru could be done) I started to point things out and they began to get extremely defensive and started giving me every excuse in the book as to why they didn’t have time to do it all. On top of not cleaning the property, they painted with an unapproved paint color and did a terrible job and neglected the front garden to the point where I had to pull out all of the bushes and plant new ones in order to bring it back up to HOA standards… we withheld most of their small deposit (less than half of one months rent) and now they are threatening to sue us… ugg… they are trying to say that I made an agreement with them during the walk-thru which is NOT the case!! I just stopped pointing things out and started writing things down because I didn’t want to get into a confrontation with them… I was there by myself and it was two against one. :/

12 jasmine August 1, 2011 at 9:56 am

In a world full of slum lords who refuse to fix anything but call you before your rent is even due and you have never missed a payment. Things from the former tenants stay where pointed out , documented date upon move in with said LL, which we both had copies. But nothing had ever been fixed. To not have the courtesy to walk through YOUR property shows how much you actually gave a crap your property and your greed in wanting to keep your tenants deposit. Before you rent ask your LL if he does a move in and move out walk through, get it in writing. If he refuses look for another landlord because that says a lot about what kind of ignorant, careless person you will have to deal with for the duration of your stay in their dwelling. Finally, your article does not entice anyone to set foot on your property because you clearly show that it is only important to you when it comes to returning the deposit that you surely want to keep. It’s always good business to form a good relationship with your tenants and have everything in writing so that there are no arguments when your tenants vacate. As a person who has had to take said slum lord to court, I was smart enough to keep everything documented , dated photos, saved emails and certified letters and most importantly a few professional acquaintances, one who is also a Realtor as my witness to assist me in the process when the landlord refused to walk through with me, the guy got slammed and I got my money back. The lesson here… do a walk through with your tenants…the small headache you get is worth it if it keeps your but out of court.

13 Gina August 1, 2011 at 11:03 am

Hello,

As landlords, my husband and I abide by California law which requires the final walk-through. It may not be required in your state but really opens you up to litigation. Also, as one poster remarked, it doesn’t make for a strong tenant-landlord relationship.

14 Alice August 27, 2011 at 8:48 pm

You are obviously a slummy landlord.

15 Steve Crossland, REALTOR in Austin TX August 29, 2011 at 10:51 am

Hi Jasmine and Alice,

Thanks for your comments. You’re certainly welcome to run your landlording business a different way once you acquire some rentals of your own. How I handle move-outs with tenants is a tried and tested business decision, and it’s fair for to tenant, as explained in the article.

But thanks for your feedback.

Steve

16 Paul September 14, 2011 at 5:47 pm

While Texas may allow you to conduct business that way, you should alert your readers to the fact that in many other states (e.g., California), it is illegal for a landlord to fail to notify the tenant of his or her right to a walk-through, and it is illegal to refuse to conduct such a walk-through.

As a practical matter, I suspect that the way you deal with your tenants in the long run saves you money, because most tenants are ignorant of their rights and get intimidated by classic unethical practices like restrictive endorsements (e.g., “by cashing this check I agree…”). Your readers should know, however, that at least in states in which landlord-tenant laws are fair, that in individual cases where the tenant presses his or her rights, a court can and often does award substantial punitive statutory damages, sometimes up to double the original security deposit amount (in addition to the security deposit itself).

Tenants are always at a disadvantage in these kinds of conflicts, because the landlord is holding their money (and as you well know, a security deposit belongs to the tenant and is held in trust by the landlord), and for financial reasons they have to give in to landlords’ demands. Don’t get me wrong, I know that some tenants are out to rip you off, but you act like they all are. You may make a few extra bucks conducting yourself this way, but your priority seems to be to retain the largest amount of money possible, rather than making sure the right thing happens, and frankly, that is why so many Americans regard business practices like those you advocate as slimy and unethical. You really make good landlords look bad.

17 Joey September 14, 2011 at 8:50 pm

I don’t think anyone here that advocates against walkthroughs is trying to squash or even chill tenant rights. You’re barking up the wrong tree.

The potential of a tenant being awarded 3-6x damages, the necessity to prove such damages were real, and the hassle of court are enough to make any ill-gotten gain be not worthwhile. What we are talking about here is the reality that the vast majority of tenants will never admit to you that there is any damage. Infact, they will argue with you. A lot. At this point, even if you go back to your photos and documents and can prove the damage, you’ve riled them up. Now they’re fired up and when they get that deduction, I personally believe they’re going to argue more. My best tenants ever turned nasty when I pointed out a few minor things. And that was even prefaced by “I’m not going to charge you for this”.

If I were forced to do a walkthrough, I would make it so brutal the tenant would leave early on their own. Why should I be held to that which I spot immediately, under pressure, under certain lighting and conditions? I’d get out pictures, carefully examine the place, and so on. What about the urine smell in the carpet that is not evident until you clean–but once you start doing so is unbearable? What about scratches and gouges on expensive wood floors that aren’t immediately obvious, but once you see them, you see that they’re all over the place and show an obvious carelessness, and constitute significant damage? Oh yeah, I’m the scumbag.. right.. but the tenant who managed to puncture a laminate floor in 7 different places–they’re the poor, oppressed tenant that I’m taking advantage of. Yeah, I’m what’s wrong with America. Do you have any idea how difficult it is to puncture a well made laminate floor? That’s not even in the class of accidental damage. That’s deliberate damage.

18 Steve Crossland, REALTOR in Austin TX September 14, 2011 at 9:43 pm

Hi Paul,
> You may make a few extra bucks conducting yourself this way

Property Managers don’t “make” any money on repairs. We only deduct for legitimate damages. The entire balance is returned to the departing tenant.

I have a lot of property manager friends in California. It’s hardly a model of sanity. It’s the joke of our nationwide email list-serve. The laws there are so pro-tenant it’s ridiculous. And despite that, based on the war stories shared on the list-serve, the tenants there have the biggest chips on their shoulders and complain more than in any other state. Which really just proves my point. No good deed goes unpunished. The more accommodating and “nice” landlords are, the more complaining and flack they receive at move-outs.

Texas has sensible, fair laws that balance landlord-tenant rights. Nowadays, every tenant can take a gazillion photos before move-in and at move-out to document condition. Texas has a triple-damage law for unlawful withholding of deposits, and JP Courts are very accessible and easy to use. There is nothing a Texas tenant can hope to gain by trying to pin down a move-out assessment at an attended walk-through. They just need to follow the lease and Texas Property Code and their rights remain fully intact.
Steve

19 Paul September 14, 2011 at 10:10 pm

You know, I think the positions people take here reflect the situations they have been in more than anything else. As landlords, you take note when tenants try to screw you. You might be totally ethical business people, I don’t know you, but if you think that landlords don’t routinely try to screw tenants, you just don’t know. I’m not saying all, or perhaps not even a majority, but a substantial percentage of landlords do whatever they can to deprive tenants of their rights. In some areas it is gray, but in others it is black and white.

I had a landlord in Los Angeles once try to not pay any interest on my security deposit — something required by law in Los Angeles, and where it isn’t prescribed by law, it is certainly the only ethical thing to do, for obvious reasons. When I pointed out the law, the landlord with a straight face said “oh that doesn’t apply.” The same day he was served, he wrote me a check.

People, whether landlords or tenants, can be evil. I’m sure not giving your tenants walkthroughs saves you money, and you might very well be relatively honest in your dealings with your tenants. But please don’t pretend that there isn’t a substantial amount of fraud, charges for ordinary wear and tear, repainting charges after a tenant lived there for 10 years, etc., and that not giving a walkthrough is a strategy used by unscrupulous landlords to facilitate fraud. It happens all the time. You might not care since you’ll never be on the receiving end, just like people who aren’t landlords might not be very sensitive to the terrible things tenants do, but if you deny that it happens on a regular basis, you are out of touch.

20 Steve Crossland, REALTOR in Austin TX September 14, 2011 at 10:26 pm

Far more leases are breeches by tenants than landlords, mainly for non-payment of rent, skipping out early, moving people in who are not authorized by the lease, bringing in unauthorized animals, etc.

Do some landlords try to screw tenants out of deposits? Of course. But if you’re trying to make the argument that the typical American lease contract is violated more by landlords than by tenants, the actual facts say otherwise.

But this article was simply explaining why we have this particular business practice and why it makes sense to do it our way. Any landlord is free to do it differently, but in Texas, a tenant in fact has no right to a move-out walk-through and it would serve no useful purpose if they did. That’s the point I’m making.
Steve

21 Joe September 27, 2011 at 1:29 pm

This is simply put an easy way to have to provide justification and/or the tenant with an opportunity to repair any supposed damages. The fact of the matter is that Texas needs to provide more legislation around renter’s rights… i.e. Landlords should have to pay interest on the balance of the deposit retained over the 30 days post vacation. The fact of the matter is that Real Estate agents that handle rentals, only do it to supplement their income… and because its harder work with a lower pay off… they simply see tenants as a nuisance. Most Real Estate agents are not properly trained or qualified to be in the business, and are very disorganized. That is the main reason for avoiding direct interaction with the tenants. It simply results from a lack of planning, a clear exit strategy or process. Because of that lack of preparation it causes delays in doing the “walk though” (which many don’t happen at all)… and even further delays in refunding the deposit. Deposits are simply put… NOT OPERATING CAPITAL… they are monies held in lieu of “damages”. The definition of which will continue to be subjective (based on the Landlords opinion only) until there is sufficient regulations in place to protect people from LAZY Realtors.

22 Steve Crossland, REALTOR in Austin TX September 27, 2011 at 2:50 pm

Hi Joe,

Paying interest on deposits is done in some states, but not all. It’s a huge hassle, especially for the software makers and also when the agreed rate (as prescribed by some states) is higher than the rate paid by the banks who hold the actual deposit funds.

> Most Real Estate agents are not properly trained or qualified to be in the business, and are very disorganized.

I agree. Those of us who have been professional property managers constantly encounter part timers who have no idea how to run a management company. The serious property managers belong to NARPM (National Association of Residential Property Managers) and obtain professional designations such as MPM (Master Property Manager).

Thanks for your comments.

Steve

23 Paul September 27, 2011 at 3:03 pm

Perhaps a middle way that would help both parties would be to do a non-binding walk-through. I understand the arguments here against binding walk-throughs (basically, hidden damages that surface later) — but often tenants just would like to know what they need to address. If the walk-through isn’t binding, and everyone is very clear about it, it gives the landlord an opportunity to point out some of the things the renter should fix before moving out, which has to save everyone money.

The law in Los Angeles is basically this — landlords are required to do walk-throughs if requested, but they are allowed to make deductions from the security deposit for damages that weren’t visible or apparent during the walk-through, either b/c furniture was in the way, or because it was temporarily concealed by a cleaner but clearly visible after.

I know this might seem like a hassle, and it might be personally annoying to deal with combative renters, but if everyone is very clear in advance about the non-binding nature of the walk-through, there isn’t any reason why the tenants would be combative, since knowing it is not binding, they will only request it if they genuinely want some direction (rather than trying to lock the landlord into agreeing that the tenant isn’t liable for anything not seen in the walk-through).

Besides, if a hidden smell or something comes up after the tenant moves out, what are they going to say, that the landlord intentionally damaged his/her own apartment so that he/she could deduct additional damages? In any event, it won’t matter b/c there is no legally binding document.

As for Joe’s comment about interest on security deposits — this is obviously right, and is I think a clear litmus test to see whether the landlord is acting in good faith. I’ve lived in several different states (military), and wherever I go, whether it is required by law or not, there are honest landlords who will pay interest on security deposits, and I would never agree to lease from a landlord who won’t. The deposit is the tenant’s money, held in trust to cover damages. If the landlord is going to use that money in the meantime either as an investment or to facilitate operations, the tenant is ethically and in many places legally entitled to interest. That being said, if the landlord chooses to invest the money, he/she shouldn’t be forced to pay any more than the actual interest earned. But I think everyone can agree that it is a common sense good faith practice — I’ve never heard an explanation for why the landlord shouldn’t pay interest, though if I’m not seeing this properly, I invite someone to explain the justification.

24 Steve Crossland, REALTOR in Austin TX September 27, 2011 at 3:36 pm

> I’ve never heard an explanation for why the landlord shouldn’t pay interest

Well, no Texas Landlord I know of pays interest. We’d have to send a 1099 to the tenant for interest earned, plus other regulatory hassles, not to mention the difficulty of tracking this without special software. Some professional property managers manage 100s of tenants and the reporting and compliance costs would be higher than the interest amount earned on the deposit. Then you have the small mom and pop landlord who owns only one rent house and isn’t equiped to deal with the reporting burdens.

It’s nothing to do with fairness or ethics. It’s simply a needless burden on business which would cause more trouble than it solves. It’s the sort of “feel good” law that is now driving business away from California to Texas, by the droves.

Luckily Texas leads the Nation in NOT imposing this sort of nonsense on business owners.

Steve

25 Joe September 27, 2011 at 3:58 pm

REPUBLICAN much??laziness is a character flaw and can’t be legislated… I agree with you there. A manlier should have no right to earn interest for monies held in trust… period. When a security deposit is required… it is required immediately… and should be refunded with the same haste. If the walk through is done properly and by a qualified individual… there wouldn’t be these suspicious “after the fact” issues. Many properties rent the day after a tenant moves out… so a walk through would make sense and avoid needless finger pointing. STOP being lazy… and do your job!

26 Steve Crossland, REALTOR in Austin TX September 27, 2011 at 4:13 pm

Well, Joe, all I can say is that if/when you own your investment properties, you can differentiate yourself from the competition by offering instant deposit refunds with interest.

I simply spelled out why I do it the way I do. It’s a business decision and it’s a fair and reasonable approach.

27 Paul September 27, 2011 at 4:14 pm

>It’s nothing to do with fairness or ethics. It’s simply a needless burden on business which would cause more trouble than it solves.

I agree that if you had to track it like you say, it would be a pretty cumbersome hassle (though I don’t know if it would be as much trouble as you describe if you just put every tenant’s deposit in a separate savings account and passed on the tax liability to them). But, I don’t think that is really necessary, as you could just set an interest rate and then just multiply it by the amount of the deposit and then time it was held. In Los Angeles, the interest rate for 2011 is .29% — so if the deposit is $1000, that’s less than 3 dollars a year (and negligibly more if you compounded it continuously, though that would be above and beyond). In terms of costs, it is extremely trivial, but it is a matter of principle and, at least for a certain population of potential tenants like myself, it is a way to compete against other landlords. For me, it isn’t about the savings– it’s a cue I use to help predict how fair the landlord is going to be with me. In that respect, it works better in places where it isn’t legally mandated, as it is then that there is an opportunity to use it to distinguish between otherwise equal potential apartments.

I’ve never lived in Texas and it may be so alien there that it wouldn’t make a difference, but I dunno, I think the cost is so low that it is a basically free advertisement. And if/when there is a conflict with a tenant, if the tenant thinks you are being fair, they are probably going to be a little more reasonable (speculation on my part since I’ve never been a landlord, but it seems logical).

Anyway, just a thought.

28 Tami February 11, 2012 at 8:52 am

Hello: I see this is a little bit old but I am wondering if you or any of your readers, would share your ‘checklist’ of things you check after the tenant has vacated?

29 Tanya February 26, 2012 at 1:02 pm

The laws regarding landlords and tenants vary from state to state, and are also subject to various local ordinances as well. I find your advise very sound and prudent, but it may not be applicable to all Landlords. In my state and in accordance to local ordinances, a Landlord is required to return the security deposit within 45 days after a tenant vacates, and itemize all amounts withheld. There is no legal law or ordinance here that requires a landlord to agree to providing an exiting tenant with a walkthrough.

That said, in this current economic crisis, I know more landlords who have ended up losing their rentals and even filing bankruptcy due to the difficulties of evicting nonpaying tenants. To avoid the time and expense of the eviction process, we do whatever it takes to mitigate our damages, up to, and including letting tenants out of their leases early without penalty, and even refunding at least a portion of their security deposit upfront, in return for leaving voluntarily without forcing us to take them to court.

It is far cheaper to buy a $15 gallon of odor remover, and dump it on the carpet ourselves, than to hire and pay $1,000 to an attorney to defend against a tenant lawsuit. I can vaccum the cat hair off the refrigerator coil in a couple minutes for free. If we ever tried withholding any portion of the security deposit for anything like that, I have no doubt that the tenant would prevail in court because the laws here prohibit landlords from with holding any portion of the security deposit for “normal wear and tear.”

Under that same principle, if the tenant tore great big holes in dime store linoleum, they might also prevail in court, because they could argue “normal wear and tear” for crap material. Instead, we use an extremely high-end wood grain laminate that is made out of rubber, waterproof and designed for heavy duty industrial traffic. We haven’t had a tenant yet who’s managed to find a way to damage it, but if one ever did, its just snapped together, so individual pieces can be easily and cheaply replaced. We also spend the extra $5 per gallon for the expensive paint, that cleans up easily with a “magic eraser”, and don’t use $10 faucets that are bound to break in rentals.

Rather than nickel and dime departing tenants over the security deposit, we cover our costs by charging a higher monthly rent than most other landlords in our area. We don’t have a problem renting out our properties because tenants can see the difference in the quality, practically the second they walk through the door. It also helps attract higher quality tenants, who would not want their credit harmed by an eviction and unpaid utility bills.

Basically, we automatically build an extra $50/month into the rent, to cover the costs of cleaning and repairs, which amounts to $600 over the course of a 1 year lease. As long as any damage does not exceed that amount, we refund departing tenants security deposits in full.

30 Reid March 15, 2012 at 12:24 pm

Steve is on point. I have seen a carpet stain “clean away” by a reliable professional carpet cleaner. I was very happy and the new tenant was very happy. (The next day I received a call that the carpet stain “reappeared”.)

31 Sue March 18, 2012 at 5:02 pm

Hi Steve,
this is such a timely find for me. My tenant is threatening filing a complaint as she does not agree with my reasonable charges for the damages. I have one question. If the tenant fails to submit move-in condition report (within 7 days according to my lease terms), per property code, it is deemed that the property is free of damage. She submitted the document 20 days after move-in. In this case, do I have the right to assume everything was ok without a written statement letting her know at the time of move-in.

She is disputing items that are clearly not marked in move-in report. However, i want to know if not turning in report within specified limit in the lease nullifies her claims. I appreciate your insight.

thanks,
Sue

32 Steve Crossland, REALTOR in Austin TX March 18, 2012 at 5:08 pm

Sue,

Since any dispute would ultimately be in JP Court, you’d be at the mercy of the particulat JP Court Judge (assuming you are in Texas). The Judge may or may not care about the move-in condition turn-in timeline, so I’d show up prepared to argue on the merits, as if the move-in condition form had been turned in on time.

Steve

33 Sue March 18, 2012 at 5:33 pm

Thank you for your prompt response. what happens if the property is in texas, tenant moved out and i am out of state??

34 Steve Crossland, REALTOR in Austin TX March 18, 2012 at 5:36 pm

Sue, you’d have to hire an attorney to represent you or come into town for the court hearing. You’d need to weigh those costs against whatever the disputed amount is. Sometimes it’s best to just settle for small amounts.

Steve

35 Sue March 20, 2012 at 9:19 am

Hi Steve,

Do u have any attorney(real property law) recommendations in Austin??

thanks,
sue.

36 Liza June 30, 2012 at 10:26 pm

Has anyone ever heard of a tenant having the “right” to hold the keys and garage door openers back (after their lease has ended) until an end of lease walk through is done ?? This is in upstate NY. I have no interest in doing a walk through. Along with signing a lease, the tenant was sent a move-out letter/instructions and move-in pictures that were taken one month before the end of their lease.

37 Steve Crossland, REALTOR in Austin TX July 1, 2012 at 8:05 am

Hi Sue, I don’t have any attorney recomendations.

Liza, no, I’ve never heard of a tenant “right” of withholding keys and garage opener. That wouldn’t fly in Texas. I have no idea about New York.

Steve

38 Carter July 12, 2012 at 9:41 am

Interesting post with a good discussion afterward. I see both sides as I have been a tenant for most of my adult life and my family also owns rental property. Based on my experience, the root of the problem is usually ‘bad renters’ in general.

In the last five years, I have been shocked and disgusted by the state in which people leave rental properties. I have seen so much trash, furniture, and other debris left behind that I understand why landlords are so worried about not being allowed to keep deposits in order to pay for repairs.

I resent people who do not follow through with their legal obligations – whether they be tenants or landlords. Many of us are in situations where we don’t really have a choice between rental and ownership. People who abuse this relationship cause a greater level of stress and difficulty for the rest of us and frankly, I don’t appreciate it. I doubt that ANY good landlord or tenant appreciates it.

As for the move out inspection – I am generally appreciative of this process, have not participated in it from the landlord side of it, and have not had any problems regarding it. Most of the apartment managers that I’ve worked with did conduct a walkthrough inspection with me, but a few did not. I got my deposit back either way. As long as he is acting within state law, this is a business decision that every landlord has the right to make.

People seem to think that businesses are evil and greedy if they look out for their own interests, yet businesses can’t exist otherwise. Those same people want the freedom to manage their affairs the way they see fit, yet they criticize others who also do this. Reality is that rental property ownership is a TOUGH business that isn’t even profitable at times! The idea that all landlords are wealthy Scrooge-like people couldn’t be further from reality.

The bottom line is this – if a landlord chooses not to do a final walk-through with a renter (assuming that is legal in the state of the rental property), the renter usually has nothing to worry about as long as he has actually followed through on his part of commitment.

39 Rochelle July 30, 2012 at 8:06 pm

So, I am probably barking up the wrong tree, since this site seems to lean towards the property management opinions in Texas.. But, I will try my luck for a decent answer.

We recently moved out of a rental property to purchase our new home. We are military and have had many final walk throughs in my life. This lease, was the FIRST in my over 20 years that I was told point blank that it is company policy to NOT allow either the tenant or owner present. All I wanted was a list of items they felt needed to be addressed.

Let me include that HUGE red flags went up when heard that news. This is supposedly a decent property company here in San Antonio. Anyway, we went WAY out of our way to make the house was immaculate, had professional carpet cleaners come in… Which we were told was all that was required to vacate… The home was scrubbed from top to bottom, yard was immaculately trimmed… We even videod the entire house… Oh, important note- The owner had a custom paint scheme in the house that we did not ask for or change upon moving in…. Upon moving out.. we puttied all picture holes, etc that needed to be addressed and was told by the PM that we were to use the paint left behind by the owner to do our touch up painting… After TWO years.. the paint was no longer an exact match and it was obvious…. They not only kept out entire $1700 deposit.. they charged us $900 to repaint the house another $264 to ‘CLEAN’ the house.. that is obviously clean in our video and there was even damage in pictures they sent us in the ‘Itemized’ report that WAS NOT there in our video….

We are going to military housing with the PMs pictures and our video…. looks like we will also be going to small claims court since there blatant discrepancies from our video and their pictures.. This is an obvious example of WHY Texas needs better tenant rights…

We were not out to ‘RIP’ off the owner or PM…. We expected something to be withheld… just because that is the way the world turns.. BUT, to keep $1700 to paint the house…. We were in the home Two years…. And we did not ask for custom paint….

40 Steve Crossland, REALTOR in Austin TX August 5, 2012 at 3:50 pm

Hi Rochelle,

Sorry to hear about your experience.

> All I wanted was a list of items they felt needed to be addressed.

We provide that to tenants when we receive or give the notice to vacate. Most professional property managers I know have a “move-out checklist” of some kind, that they mail and/or available on the website.

> Upon moving out.. we puttied all picture holes, etc

Well, our move-out instructions scream “Don’t” putty the holes. Your story is exactly why we want tenants to leave the holes alone. If you were instructed by the PM to do that, and to use the old paint, and you have that in writing, then they may have a hard time defending the deductions in court. After all, you’re not expected to be painting contractors for the owner. The TAR Lease allows a “reasonable number of small nail holes” to be left at the property.

It doesn’t cost much to send a demand letter for the amounts you deem improperly withheld, then follow up with a small claim if that doesn’t work.

Good luck,

Steve

41 Davy August 8, 2012 at 12:45 pm

Your blogs and retorts are very informative. Thank you. As a PM, what action do you ascribe to if your landlord (client) negotiates in bad faith and causes undue hardship and expense to your tenant?

42 Claudia August 31, 2012 at 11:30 am

Thanks so much for the info. I am just in the process of checking the legal situation re. this in Florida. That link to a website (in the comments somewhere) didn’t really help me. I’ll be dealing with an already highly argumentative tenant tomorrow morning. He is moving out rather short notice and informed me of the time (Saturday, before 8:00 am) a few days ago. He is very argumentative and will insist that I sign that all is fine. He has kept the place in great shape as far as I can tell but it is fully furnished and I feel like I can’t check all the appliances, A/C filters, etc with him breathing down my neck on his way to the airport.
To prevent further stupid mistakes on my part – can you recommend a good contract? And what’s your process/paperwork when someone moves IN?
Thanks for any advice.
Stressed in Orlando,
Claudia

43 Steve Crossland, REALTOR in Austin TX August 31, 2012 at 2:51 pm

Hi Claudia,

Don’t allow yourself to be bullied by your tenant. You have no obligation to show up and get berated or pressured into an “on the spot” or “instant” declaration of “pass or fail”. If you feel intimidated, just take a friend, collect the keys, and say “I’m not going to have time right now to conduct a full move-out inspection, but I’ll do so and return your deposit in accordance with property code rules”.

Good luck,

Steve

44 Claudia August 31, 2012 at 6:44 pm

thanks!!
Can you recommend a good contract to use with our next renter?
And what’s your process/paperwork when someone moves IN?

45 Diem September 13, 2012 at 11:46 am

Steve,
I know you don’t recommend walk throughs upon move-out. Curious what your position is regarding move in.

Thanks!

46 Steve Crossland, REALTOR in Austin TX September 13, 2012 at 11:56 am

Claudia: We use the TAR Lease Agreement. You have to be a Realtor or use a Realtor to use the TAR forms.

Diem: I usually do meet tenants at move-in. Oddly, many property managers don’t/won’t do this, but they do walk through at move-out. I like meeting tenants at move-in because:

a) It may be the first/only time we’ll ever see each other in person.

b) Often, I haven’t had time to walk through the house yet following the pre-move-in prep, such as carpeting cleaning, make-ready cleaning, painting, repairs, mowing, etc. Especially when we’re moving someone in 1 to 3 days after the previous tenant moved out. I want to be there to make sure everything is good and take care of any problems right away.

Steve

47 Steve Crossland, REALTOR in Austin TX October 21, 2012 at 10:57 am

Hi Richard,

Thanks for your comment. It is factually incorrect though. I understand there can be different points of view on this topic. What I wrote about, and continue to practice, is the case against walk-through. You are free to disagree, but I have to respond to factually incorrect arguments. A tenant’s liability for damages and deductions is in no way connected to whether a move-out walk-through occurred.

A good resource for tenants who need help with handling improper deposit deductions is the Austin Tenant’s Council.

Thanks for your input!

Steve

48 Michelle December 22, 2012 at 12:31 pm

I completely agree with you Steve.
I used to do check-list walk throughs with tenants when they moved out, and it was frequently a fight. Pretty much every time I would hear “It was like that when I moved in.” Really? The refrigerator looked like a cat blew up in it when you moved in? So, I started taking my 6’4″ husband with me on walk throughs and the fights pretty much came to a complete stop, even tho he just stood there and usually didn’t say a word. :)
I still do walk throughs with the tenants, since I’m in California and am required to. But, I bring a video camera with me and video everything. I make sure to get the tenants on camera to prove they were there with me on that date. I never tell them that they passed or not. I tell them they will be notified by mail of our final findings within 21 days. If they argue later, I send them a copy of the video. Once I started using the videos, I’ve never been to court.

49 Dan December 27, 2012 at 2:45 pm

I live in California so we do not have a choice in this state. Failure to do a walk-through with a tennant forfiets the right of deposit. Period. As a tennant for many years I can tell you how many times my deposit was ripped off from horrible land lords who would refuse any repairs and then blame me and take my money. In fact, my interest in the law is how I got into managing property. I don’t look at myself as an agent for the land owner but as a middle man who sticks to the law. I protect both sides. Here in California, I do a 2 week pre-move out walk through that gives the tennants the ability to repair any defects and a final move out inspection when they leave. Of course, that is required in this state if the tennant asks for it. What I have found is that most tennants have been ripped off so many times that they almost always assume they are not getting the deposit back, which then leads to a messy home. In fact, most of them don’t know the law. I make sure both walk throughs are done and the majority of the time they are clean. Of course, like any one there is an occasional disagreement however in 12 years I have not yet been to court.

50 Kaycie December 31, 2012 at 6:34 pm

Just read this, and, as a tenant, I have a question.

My apartment’s management constantly seems to try to find the “cheapest” solution, or best way to make/save a buck. I spent over a week without a ceiling in my bathroom (after upstairs neighbors flooded theirs, dropping our ceiling), with exposed wires hanging over my shower, because my landlord said they were looking for the best bid to fix it.

I just spent over 36 hours without water or sewage (with a major medical condition), because, according to my apartment’s maintenance, “its Sunday, so it won’t be fixed today”, ie- not wanting to pay a plumber weekend pay, with 2 complexes completely out of water and sewage. Also, they are not willing to pro-rate even the day we spent, despite it being “uninhabitable” by Texas Property Code.

The majority of tenant here do not speak english, and are not educated, and I feel that if I try to bring any of these issues to my landlord again, there will be severe deductions from my deposit

I am moving out soon (a month or so after closing on a house), but with the attitude my landlord has shown this far, can I really expect them to be fair with the deposit?

51 RC January 3, 2013 at 12:39 am

This has been extremely informative. Thankfully, I live in TN, and there is no walkthrough requirement. My first renter demanded that she receive her deposit in full, and told me that she had the right to a walkthrough. Upon research and talking with a few PMs in the area, I found that tenants are only allowed access to the unit if they wish to dispute the accuracy of the damage listing, not because they have the right.

My tenant glued the top of the toilet to the tank after filling it with debris, threw trash off the balcony into the community area, and placed nails inside the garbage disposal. And I am having trouble understanding why she demanded a walkthrough… to see the look on my face when I find all of this damage?

I have been both a tenant and a landlord. I never got back all of my deposits in full, but I also have never been stiffed. There are laws in place that protect all parties because some people cannot accept the responsibility of being a decent person. I hope the tenant enjoys the home, but we aren’t friends. This is a business arrangement, and it is not my position to educate tenants on the difference between right and wrong or make sure that they know what rights they have. I place an ad for rent, someone shows interest, we discuss the lease, and they choose to sign it. I am taking a chance that they will fulfill the terms, and they take a chance that I will provide a functional space to live in.

52 Steve Crossland, REALTOR in Austin TX January 3, 2013 at 12:35 pm

Thanks for your comments Dan and Michelle.

Kaycie, you should contact your local Tenant’s Council for advice. In Texas, there are laws against “retaliation”, which is any adverse action a landlord takes against a tenant that can be connected to a request for repairs. So a tenant should never feel afraid to report legitimate repair problems such as those you describe.

Another option is to make an anonymous complaint to City Code Enforcement, which will trigger the City of Austin to come investigate and take further measures.

In the end, your lease agreement an TX Property Code control everything. Withholding deposits without justification is not allowed.

RC – been there, done that with tenants who do that sort of thing. Sometimes they seem like the nicest people in person, but who knows what motivates that sort of thing. At a certain level of damage, it becomes a legal/insurance issue. I had a tenant once hammer holes in all the sheetrock in every room of a house, after losing at eviction court. The police came and deemed it (I forget the exact word) something equal to criminal vandalism. Owner’s insurance paid for the damages and the tenant was charged with a crime, and eventually settled to make restitution.

Steve

53 B Michael January 3, 2013 at 2:34 pm

Wow, great advice. I have done one walk-through, and while it went ok, the tenant left expecting to receive their full deposit. Somehow they thought the non-refundable pet deposit would apply to them leaving a big mess. They were mad, but I think we only disagreed over less than $200 :)

54 Paul January 3, 2013 at 3:19 pm

“non-refundable pet deposit” lol. It isn’t a *deposit* if it is *non-refundable*. Obviously. If it is non-refundable, call it a fee, and then you won’t have people expecting it to be returned. Unless it is illegal to call it a fee where you live, in which case it is almost certainly to have a “deposit” that is non-refundable and for practical matters indistinguishable from a fee.

Sorry if this is off-topic but the Orwellian doublespeak can be maddening.

55 RC January 4, 2013 at 2:45 pm

Is it possible to get a copy of your 150+ point preventative maintenance checklist?

56 John January 13, 2013 at 8:56 pm

I rented a few homes for 20 years. My personal take on deposits are:

1 – If the home was really torn up the deposit did little good.
2 – A home that gets torn up is often because I did a poor job inspecting and maintaining it. You have to put the brakes on a bad tenant before it gets out of control.
3 – I never charged for a hole in the wall or a ripped screen. I factored that wear n tear into the rent. I hardly ever did a walk through where it was not rode hard and put up wet.
4 – I almost always refunded deposit just to get rid of them (whether they were good tenants or not). I looked at refunding deposit as a way of shutting the door on a lawsuit.
5 – If I did deduct I would ask the tenant to agree with the conclusion writing. In the few times I deducted the tenant always agreed with me.
6 – The best thing I ever did was use a 3 month lease and gradually expand it (6, 12). Coupled with diligent inspections I caught the bad tenants fast and was able to get rid of them with a legal lease expiration. It did put off some potential tenants but I was OK with that.
7 – 4 lawsuits in 20 years? Negligible relative to the real risks. Your doing great.

I had some great tenants and some bad ones. I got out of it because I got tired of it.

57 Jim Johnson March 30, 2013 at 8:36 pm

I would really appreciate having a copy of your 150 point preventative maintenance checklist. I own one rental house and have found you comments and advice very valuable.

Jim Johnson
Bridgeville DE

58 Wes HUnt November 7, 2013 at 10:37 am

Great, well written article! I must admit I didn’t agree at first (I own a rental, using a property manager), but you present very good reasoning and we actually do something similar. As a tenant in the past I don’t think we ever did a move out walk through with the manager and most of the time it was a reasonable experience. The only thing I would add is to do your walk through (or have your inspection person do it) before any “professional” cleaners come through. The few times we’ve had issues either as owners or as tenants the damage was caused by the cleaners who tried to pass it off to the renters. We now like to do a thorough walk through (without the tenant) before the cleaning crew comes through, then we can also evaluate the cleaning services we’re paying for. If there’s any issues we take photos and document it so we can discuss it with the tenant.

59 Ed January 15, 2014 at 11:30 am

People who generally ask for a walk through are the good and honest people who are trying to get their security deposit back. It’s attitudes like this person that make me see why people live out their security deposit by not paying their last month rent…thus not giving the landlord a choice on whether the landlord return the deposit or not. After reading this article, I’m going to be one of those people cause clearly this is nothing more then perpetuating lies. Fleas? Give me a break. At best it’d cost 100 dollars for a landlord to rid themselves of them…but this guy clearly thinks he’s entitled to an entire security deposit for this minimal cost…and btw author…your also not entitled to new carpet even if your carpets have these miracle stains as you claim…you are only entitled to the value of the carpet less it’s depreciation…Often slumlord apartments like the ones this guy is suggesting the flooring has no value as carpets only have value for about 5 years…After that they have no value…If they aren’t older than that then they can be repaired by what is called remnants.

60 Steve Crossland, REALTOR in Austin TX January 15, 2014 at 1:15 pm

Hi Ed,

Thanks for your comments. Most of my tenants receive their entire deposit back. I think you misinterpret the reason for the no walk-through policy. But I do appreciate your feedback.

Steve

61 Jonathan May 30, 2014 at 2:24 pm

This article is just another “shady” business practice! First of all, If I was a Rental Manager, I would make sure that a walk-through is done with the new tenants once they agree to rent. If Renters/Managers were as interested in doing pre and post walk-throughs as they were when they were trying to get you to rent the unit, we would not have reason to have a discussion like this. Bottom line: Instead of giving the tenant the checklist and telling them to go home and do an inspection, the Renter should have a list of what is ALREADY wrong with the unit and do a pre-move-in walk-through WITH the tenant to give the tenant an opportunity to Affirm and add any other problems.Then a post walk through should be “cut and dry”..but then again, that would leave very little room for the Property Owner and Manager to bilk a poor guy out of his deposit.

62 Steve Crossland, REALTOR in Austin TX May 30, 2014 at 4:17 pm

Hi Jonathan,

Thanks for your comments. Nothing shady about how we do business, but I appreciate your thoughts.

Steve

63 Joey May 30, 2014 at 4:27 pm

Hi Jonathan,

So let me say what Steve is too polite to say:

You’re clearly NOT a rental manager, or you wouldn’t be speaking like this.

Policies and procedures always exist for a reason. That reason may or may not be related to your behavior, but it is defensive in nature and usually gets put into place after someone gets burned by bad tenant behavior.

Laws exist to allow you as a tenant to not only recover improperly withheld damages, but 3-6x. Cameras are ubiquitous and cheap. Small claims costs $75 to file in and you need no attorney. So why are you complaining?

64 Joey May 30, 2014 at 4:32 pm

Ed,

I do not recommend you try to “live out” your security deposit in the last month. This is horrible advice. If you did that with me, and I couldn’t politely talk you out of it, you would end up in court fighting a nonpayment eviction.

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