Many owners and tenants have the idea that a move-out inspection with the departing tenant is a good idea. In reality, it may benefit the tenant, but only if the owner or their representative makes some mistakes that later can be used against the owner. Invest a few minutes to learn how to avoid these mistakes, and the ensuing battle over a security deposit.
Here are possible mistakes and the resulting bad outcomes if an owner or property manager are not diligent in how a move-out inspection will be completed.
Move-Out Inspection Mistake #1
Implying that the property looks OK, or anything similar when meeting the tenant for the keys.
A final walk-through with the tenant is not the way to actually study the conditions of the floor coverings and walls. Or to confirm all mechanicals and fixtures are functioning properly. There are too many ways to be distracted. There will also be pressure from the departing tenant to explain whatever you find and question. It’s possible to temporarily hide pet odors, carpet stains, or appliance malfunctions. In an effort to get out of the property, the temptation will arise to tell the tenant that the house looks OK when it does not. Or you just have not found it yet. Now you are set to have a fight later with the tenant who will remind you of your words.
Let the house sit vacant a few days in order to find what a former tenant may try to hide. Make the tenant drop off the keys or leave them in a drawer.
Move Out Inspection Mistake #2
Inferring a return of the security deposit in full.
See Mistake #1 and realize that the correct environment to assess the return of a security deposit is one where all parts of the home can be inspected. The results of the inspection should then be compared to original move-in reports. Finally, properly calculate if any funds need to be subtracted from the security deposit to pay for repairs.
It’s understandable that many tenants are counting on the return of their security deposit in order to move forward with their next housing commitment. For this reason, the departing tenant will often do everything in their power to ensure the return of these funds. They may badger the owner or manager to state some type of indication as to how much of the fund will be returned and when. Anything said could result in later problems, so avoid this situation all together.
Move-Out Inspection Mistake #3
Meeting the move-out tenant for a move-out inspection.
As a property manager, our client is the property owner. We are hired to lower risk and mitigate problems. A walk-through with the tenant will do nothing to respect that fiduciary responsibility. One of the primary purposes of the move-out inspection is to document any deductions from the former tenant’s security deposit. To do the best job possible, complete documentation of the condition of the property must be completed. This inspection is best prepared with the benefit of the property being vacant and alone.
The move-out inspection represents the conclusion to the tenancy process. In our practice, we avoid ever touring for the final time with a tenant present. If the tenant insists on doing so, we will tour the home one final time before completing a security deposit settlement statement.
The Tenant’s Perspective
If you are a tenant reading this please also understand that the move-out inspection needs to be conducted fair and honestly. There should be no reason for you to feel cheated from your deposit. The goal is to create fair and honest documentation of the condition of the property after the tenant leaves.
A great thing a tenant can do is submit to the owner or their representative in writing any concerns that may create an issue with the security deposit. Don’t try to hide the fact the cat shred the carpet inside the back corner of the closet. This damage will be found. With a written explanation all parties can work together to address any issues. Working together just might expedite the approval of the settlement of the security deposit.
Move-out inspections do not have to be complicated. Many problems can be avoided by having great documentation of the condition at move-in. Tell the departing tenant you will be completing the inspection alone and will follow-up promptly. Ask them if there is anything that might need to be explained. Get in promptly after the property becomes vacant. Don’t make any representations or guesses to anyone about the condition. Let your inspection and its documentation do you’re talking.
