Throughout your time as a landlord, you’ve likely come across tenants that treat your property with little regard for basic cleanliness or respect – it’s why you request a security deposit at the beginning of any tenancy.
Inevitably, you will need to repair damages to your unit from time to time, and if the damage is severe, you will be able to use a tenant’s security deposit to help pay for those repairs.
It is essential to consider what a court deems extreme or excessive rental property damage.IMPORTANT
- What Is Normal Wear and Tear?
- What Is Property Damage in a Rental?
- How Landlords Properly Maintain Rental Property
- Case Studies: Normal Wear and Tear vs. Excessive Damage
- Life Expectancy of Items & Fixtures in a Rental Property
- What Can a Landlord Deduct from a Security Deposit?
- How to Protect Yourself
- Summary
What Is Normal Wear and Tear?
Normal wear and tear refers to the gradual deterioration of a rental property and its fixtures that occurs due to ordinary, everyday use. It is the natural aging of materials and surfaces over time, which landlords are typically responsible for maintaining.
Examples of Normal Wear and Tear
- Faded Paint: Over time, paint can naturally fade due to exposure to sunlight or general aging.
- Worn Carpet: Carpeting in high-traffic areas may exhibit signs of wear, such as thinning or slight discoloration, which is expected after several years.
- Scuffed Flooring: Minor scuffs or scratches on hardwood floors from normal foot traffic or moving furniture.
- Loose Door Handles: Frequent use can cause door handles to become loose or slightly wobbly.
- Small Nail Holes: Tiny holes in walls from hanging pictures or shelving are typical signs of use.
- Minor Scratches or Dents: Walls and doors might show minor dents or scratches that occur over time.
What Is Property Damage in a Rental?
Property damage in a rental refers to harm or destruction that goes beyond normal wear and tear, often caused by negligence, misuse, or intentional actions by the tenant. Unlike wear and tear, property damage can lead to deductions from the security deposit or even additional charges, depending on the severity.
Examples of Property Damage
- Broken Windows: A window shattered by negligence or carelessness (e.g., throwing an object) constitutes damage.
- Holes in Walls: Large holes or significant damage caused by drilling or punching through the wall.
- Stained or Burned Carpet: Permanent stains from spills or burns from cigarettes that cannot be cleaned or repaired.
- Broken Appliances: Damage to provided appliances like stoves or refrigerators due to misuse.
- Pet Damage: Significant scratches on floors, doors, or walls caused by pets, or persistent pet odors requiring deep cleaning.
- Water Damage: Damage caused by overflowing tubs, sinks, or neglecting to report leaks.
How Landlords Properly Maintain Rental Property
Effective property maintenance is key to preserving the value of a rental unit and ensuring tenant satisfaction. Proper maintenance practices help prevent minor issues from becoming costly repairs and also contribute to a smooth move-out process.
Require a Security Deposit
A security deposit is a sum of money collected from the tenant at the start of the lease. It serves as financial protection for landlords, covering unpaid rent or damages that go beyond normal wear and tear. The amount of the security deposit is often equivalent to one or two months’ rent, depending on state laws.
Security Deposit Receipt
You should issue a security deposit receipt, even if not required by law, to confirm the tenant’s delivery of the demanded amount.
Conduct Routine Maintenance
Regular maintenance helps ensure the property remains in good condition throughout the tenancy. This includes tasks such as servicing HVAC systems, checking plumbing for leaks, and addressing any minor repairs that could prevent larger issues. Scheduled maintenance also involves tasks like gutter cleaning, pest control, and ensuring appliances are in working order.
Conduct Regular Rental Inspections
You’ll need to perform a rental inspection to determine what you can deduct from a security deposit.
We recommend following this process:
- Perform the inspection as soon as possible after the move-out date.
- Bring a notebook and a camera to document your findings.
- Send a list of all the damages in your rental unit, with an itemized statement of the charges.
Landlords are legally required to send the remaining portion of a tenant’s refund and notification of the deductions in nearly every state.
Understand what damages you’re allowed to deduct from a security deposit, or you may find yourself paying your tenants up to 3 times the deposit amount, depending on your location.
Document Any Damages
Documenting damages is essential for protecting both the landlord’s and tenant’s interests. This involves taking detailed photos and notes during inspections, particularly at move-in and move-out. These records are crucial if any disputes arise over security deposit deductions. An itemized statement of damages and associated repair costs should be provided to the tenant if deductions are made.
Case Studies: Normal Wear and Tear vs. Excessive Damage
You’re within your legal right to withhold a tenant’s security deposit to help pay for anything beyond the normal wear and tear definition in your lease agreement or as the law defines this term.
Normal wear and tear may seem like a subjective concept, so it can be challenging to know what you can and cannot charge a tenant to repair.
How to Differentiate
Courts generally recognize normal wear and tear as any damage associated with the regular use of an object – in this case, your rental unit.
If a doorknob has scuffed up the wall behind it or the sun has faded those lovely curtains, all of that would qualify as the normal wear and tear of everyday use.
Excessive damage would be the destruction or deterioration of your rental unit resulting from intentional behavior or negligence (and should be grounds for beginning the eviction process immediately).
When determining whether any damage is excessive or simply from normal wear and tear, ask these questions:
- How long did the tenant rent your unit?
- Does the damage to the floor, walls, or any other item seem excessive for that period of time?
- Did your cleaners or repairmen state that their job was extraordinarily difficult in any parts of your unit?
Common Scenarios
The following scenarios illustrate common situations landlords might face and how to differentiate between the two:
Example 1
- Scenario: A tenant has lived in the property for five years, and the carpet in the hallway is worn and slightly discolored.
- Conclusion: This is normal wear and tear due to high foot traffic and age.
Example 2
- Scenario: A tenant spills red wine on the carpet, leaving a large stain that cannot be cleaned.
- Conclusion: This is property damage that exceeds normal wear and tear and justifies a deduction from the security deposit.
Example 3
- Scenario: After a one-year lease, the walls have minor scuffs and small nail holes where pictures were hung.
- Conclusion: These are typical signs of use and are considered normal wear and tear.
Example 4
- Scenario: The tenant’s pet has chewed through a section of the wooden baseboard.
- Conclusion: This is excessive damage caused by negligence and is grounds for a deduction.
Life Expectancy of Items & Fixtures in a Rental Property
Knowing the typical life expectancy of items and fixtures in a rental property can help landlords distinguish between normal wear and tear and damage, as well as plan for replacements.
- Carpeting: 5-10 years, depending on quality and traffic.
- Interior Paint: 3-5 years in high-traffic areas.
- Appliances (Refrigerators, Stoves, etc.): 10-15 years.
- HVAC Systems: 15-20 years with regular maintenance.
- Water Heaters: 8-12 years.
- Window Treatments (Blinds, Curtains): 7 years.
- Tile Flooring: 20-30 years, though grout may need maintenance more frequently.
HUD Guidelines and Financial Reimbursement Options
For landlords participating in the Section 8 Housing Choice Voucher Program, the U.S. Department of Housing and Urban Development (HUD) provides specific guidelines regarding the life expectancy of items and fixtures. [1]
Due to that fact, HUD offers financial reimbursement to Section 8 property owners in the event of a financial loss through a special claims process.
These guidelines can be particularly useful for Section 8 landlords when evaluating the condition of their rental properties and determining if repairs or replacements are necessary. Understanding HUD’s standards and the potential for financial reimbursement can help landlords maintain their properties effectively while also protecting their investments.
What Can a Landlord Deduct from a Security Deposit?
As a rule of thumb, you should only deduct unpaid rent/utilities and the repair costs for excessive damage.
You would be within your right to withhold your tenant’s security deposit to cover the cost of repairing issues like:
- Cigarette burns on the carpet
- Broken mirrors in the bathroom
- Visible pet stains
- Claw marks on wooden floors
- Filthy or irreparably broken appliances
- Large holes in the wall
You would not be allowed to deduct money from a security deposit to help pay for normal wear and tear damage such as:
- Minor dents or scratches on the wall
- Discoloration from sun exposure
- Chipped or peeling wood varnish or paint
- Lightly dirtied carpet from standard use
- Loose tiles or linoleum
- Rusted plumbing fixtures
Use your best judgment when determining whether or not you should deduct from a security deposit.
Some landlords attempt to skirt the rules and wrongfully use a tenant’s deposit to replace old or worn-out appliances.
Unless it is clear that your renters intentionally damaged them, this could be against federal and state law.
The U.S. Department of Housing and Urban Development (HUD) has a helpful guideline for determining the life expectancy of certain modern appliances.
How to Protect Yourself
There are various ways a landlord and a tenant can avoid a dispute that might end up in small claims court.
As a Landlord
Thoroughly examine your state’s landlord-tenant state laws.
Each state has a unique set of rules and regulations that govern how a landlord may conduct their operation.
Any misstep could result in forfeiting your right to retain any portion of the security deposit or potentially hefty fines. Protect yourself and make sure that you:
- Document and photograph all damages that you expect to repair
- Aren’t charging for normal wear and tear
- Provide receipts for all deductions
Use a rental inspection checklist to note the condition of all rooms as part of your move-in and move-out inspection.
Suppose you are an owner of an affordable housing unit (commonly referred to as Section 8). In that case, there are restrictions on how much a landlord is permitted to request for a security deposit.
As a Tenant
You won’t have to worry about normal wear and tear once you decide to move out.
However, if you have caused any excessive damage, it’s best to go ahead and repair it since the costs will be deducted from your security deposit anyway.
Generally, all landlords will submit a statement informing you of the reason for their deductions and the amount that they charged you.
To avoid being surprised by any unexpected charges, you can request a walk-through inspection with your landlord before your move-out date.
You might discover a significant problem that went unnoticed during your tenancy yet will still be considered excessive or the cause of negligence– like water-stained floors underneath a window or mold growth in a rarely used cabinet.
Organizing your entire move with a checklist, or requesting a walk-through inspection and filling out a rental inspection checklist, will help make sure that both you and your landlord are on the same page.
Summary
Every landlord needs to know what is considered normal wear and tear and how it differs from excessive damage.
Nearly all legislatures have determined that a landlord is responsible for maintaining normal wear and tear, and tenants should not pay erroneous repair fees.
That said, tenants should not take advantage of landlords and should pay for excessive damage to a property.
Many landlords consider forming an LLC for their rental property to further protect personal assets and take advantage of potential tax benefits.
