Posted by wasserman
A tenant sent me a receipt from a plumber for a shower repair with the total amount deducted from their rent payment. I’m half-relieved I didn’t have to deal with the problem, but is this bad practice? Could it backfire?
It is bad practice, and it most certainly can and likely will backfire. This author emphatically believes that all apartment repairs and upgrades should only be performed by the owner’s vendors and under the direct supervision of the owner or the owner’s professional property manager. There are a number of reasons for this position.
One, residents may not always use licensed and insured professionals. They may contact a friend to do the work or hire the most inexpensive advertiser. The result could be shotty services or, worse yet, defective “repairs” that either in the near or longer term cause serious damage to the building. Consider, for example, the possibility that the person engaged to perform this shower repair might in fact install a cartridge that slowly leaks within the walls, and that this leakage goes undetected until there is mold everywhere which will require drywall removal and replacement. If the person who did the work was unlicensed and uninsured, you will be stuck with a very expensive remediation tab.
Two, the tenant may order services and then not pay for some or all of the ensuing bills. The vendor could then record a lien against the property, thereby causing you to be in default under any deed of trust that governs your loan or, in an extreme case, landing you in court for collections.
Next, permitting this conduct sets the stage for the resident to simply order up improvement work whenever desired, and that could mean cosmetic or aesthetic upgrades on your dime. In addition, the resident may have gold-plated notions of what the housing needs, such as enhanced heating and ultra-high-end appliances. Since you already blessed past instances where a repair was performed and deducted from rent, you may have trouble suddenly requiring that such practices be terminated.
Also, permitting a rent offset is risky because the resident could argue that the rental value was admittedly diminished while the defect existed. Under the rent law, there is typically no basis to reduce rent while a housing service is decreased if the owner diligently addresses the situation. By allowing an offset, you open the door to deductions not just for the receipt amount but for other associated cost items like the tenant’s time to facilitate the work.
The bottom line is that this is your property, so you should be actively engaged in all aspects of property management. Many owners who are tired of managing are turning to professional management companies to relieve them of such burdens. And for the reasons stated above, no reputable management company would dream of permitting or encouraging any resident to assume repair responsibility. So if you are done with self-managing, consider professional property management from one of the SFAA’s affiliate members. Yet regardless of whether you self-manage or engage a third party to assist you, never ever permit a tenant to engage anyone to fix things at your property.