There is no other segment in the real estate industry where I see more abuse and mistreatment of consumers than in the property management & residential rental market. A quick glance through TREC disciplinary history will quickly confirm that a majority of complaints source from this area of practice.
A true professional is a student of her profession. If you are claiming to be a specialist in a particular area of practice, you'd better familiarize yourself with laws, codes, and expected operational protocol of that area. The expertise it will afford you, your clients, and your customers will be invaluable.
Offenses Commonly Seen in Everyday Practice
Screening Criteria -- the PURPOSE of this requirement is to give consumers the ability to self-screen before they submit applications and application fees.
Quit requiring application fees up front -- or at all -- if you aren't going to provide screening criteria. Per Texas Property Code, if an applicant has not had the benefit of receiving written screening criteria, and they are declined for any reason, app fees are fully refundable -- REGARDLESS of any usurious policy you may have published for your own benefit.
Quit forcing applicants and cooperating agents to ASK you for screening criteria. PROVIDE it up front, publicly accessible in your MLS listings and/or on your website.
Quit burying screening criteria in your 'online application process'. Just because you are clever enough to trick an applicant into signing it in your 'process' doesn't mean you are meeting compliance requirements. It just means you are getting your personal CYA requirements met. Your 'gotcha game' is dishonest and unethical.
Quit inviting application fees when you are working an application in hand. It is understandable that you might want to have backup applications to consider in case your working application goes awry, but WHAT are you CHARGING people for? Quit looking at app fees as a supplementary source to your income. That's the equivalent of stealing.
- Quit omitting details that you will incorporate as a REQUIREMENT of your lease agreement. It is completely unacceptable to 'approve' an applicant, collect app fees, and then spit out a lease agreement that will require an applicant to accept terms that are egregious and completely stacked in the landlord's favor. This is predatory behavior, and it is wrong. A copy of your standard lease agreement should either be published for consumers to review, or your terms should be clearly spelled out in a subsection of the screening criteria so no one is caught off guard later in the process.
Safety Compliance -- Texas Property Code mandates requirements for safety standards
- Although there are some specific exceptions, under Texas law, a dwelling must be equipped with security devices such as window latches, window coverings, keyed locks and keyless dead bolts on all exterior doors, sliding door pin locks and sliding door handle latches or sliding door security bars, and door viewers. These devices must be installed at the landlord's expense. If such devices are missing or are defective, tenants have the right to request their installation or repair.
- A landlord must re-key or change all the key-operated locks (or other combination locks) on the exterior doors be-tween each tenancy at his expense. The landlord must re-key not later than the seventh day after move in.
Many Texas cities adopted their own ordinances on the subject of smoke detectors, and multimillion-dollar lawsuits have been brought against landlords who did not have working smoke detectors in their properties and tenants were injured as a result. The landlord has the duty to inspect and test the smoke detector at the beginning of each tenancy (or at the time of installation). Texas Property Code changed in January 2013. Smoke detectors are now required in each bedroom of a rental property. The code previously allowed for a smoke detector to be installed in the hallway outside of the bedroom door.
- Property Managers and Landlords, if you are not willing to meet requirements for Safety Compliance, what are you doing in this business? Either step up or step out. Your willingness to break the law at the expense of your tenants' safety makes you a sleazebag. The "I didn't know" excuses also classify you as a sleazebag. Quit being a low-life, bottom feeder, sleazebag! Finally, if you are the type of PM or landlord who deliberately retaliates / discriminates against applicants who bring compliance issues to your attention, you are SCUM. If you are a licensed Realtor and have "managed" a property for consecutive years and have never seen to it that the property was code compliant, you are DOUBLE SCUM.
Disclosure -- A tenant has the right to know who the landlord / owner is, and whether or not there is a mortgage on the property.
"What business is it of yours to know…." fill in the blank. Classy, Mr. Landlord. Could anything possibly make you look worse in the eyes of a prospective tenant?
Nothing raises a red flag quicker than seeing a name mismatch for owner of record, or a business entity named as the owner of a property, or seeing a history of name flipping on the chain of title. It is the duty of a landlord to disclose his identity / right to legally lease a property to a tenant. As a landlord or PM, if you fear being questioned about this , the obvious question would be WHY? What do you have to hide? Failing to identify yourself puts you in the same category as a scammer.
A tenant has a financial investment in a landlord's integrity and financial solvency. No tenant expects to put down a significant rental deposit, pet deposit, and rent amounts up front, only to get an eviction notice 3 weeks later from the rightful owner of a property or a foreclosing lender.
A tenant has every right to screen a landlord just as hard as a landlord screens his applicant. Your credibility is on the line, and if you aren't willing to stand behind your own good name, why should any customer buy into you? Be forthcoming with mortgage information, corporate filings, resolutions, and the like.
PS - Your business name, if used, must be signed for by authorized principal(s). PEOPLE sign legal agreements and contracts. A hand-printed company name is not a signature, no matter what misinformation you may have received from some ignorant 'advisor' on the matter.
Repairs and Maintenance -- Quit being a slumlord.
Property Managers: Unless you have a management plan that includes periodic property inspection before, during, and after tenancy, coupled with a process to support make-ready, repair and maintenance requests using qualified contractors, and the reporting resources to provide full accountability against collections and expenses, quit calling yourself a property manager. Simply advertising a property for lease in the MLS does not make you a PROPERTY MANAGER. Forwarding emails to your landlord client from a tenant who is requesting a repair does NOT qualify you as a property manager!! Being a property manager is a big responsibility, and you have a duty to both your landlord client and his tenants to provide a minimal level of service to both parties that would include maintaining the property condition and facilitating a quality level of customer service that would justify your monthly charges for the responsibilities entrusted in your care.
Landlords: Your tenants have a duty to return the property in equal or better condition than they rented it in. However, it is completely inappropriate to expect a tenant to be responsible for structural issues or normal wear and tear. Quit turning a blind eye to your responsibilities regarding property maintenance. It's your house, your asset, and your failure when something goes wrong. If you don't want to be bothered, hire a competent property manager. If you don't want to spend the money on a competent property manager, step up. If you don't want to step up, find a different business, because you don't belong in this one.
Summary: Being a Texas Landlord or Texas Property Manager is a big responsibility. Competency separates pretenders from professionals.
We agree that reading Texas Property Code may be an arduous task. The Landlords and Tenants Guide, published by Judon Fambrough, Attorney at Law, is available for download via Texas A&M University’s Real Estate Center. This guide may be a bit more easily digestible when it comes to familiarizing yourself with Texas Property Code, and the duties of a landlord and right of tenants in Texas.
Comments? War stories? Please share feedback. The only way our industry will improve is through consumer education and a demand for higher accountability in practice.