MOVE IN INSPECTION PROCEDURES

One of the biggest mistakes a manager makes often occurs at the time the resident moves into the unit, and this mistake has major ramifications when the resident moves out. The condition of a rental unit must be documented when a resident moves in. This is crucial, as when the resident moves out and there are damages found in the unit, the manager needs to prove that the damages were not pre-existing and were indeed caused by the resident. Residents routinely say, “It was like that when I moved in”, and often, “I left it better than when I moved in”. Every manager has heard these comments made by the resident. When the resident makes these allegations, the manager must be able to prove that the damages did not exist at the time the resident moved in to prevail. How does the manager do this? A really thorough manager will have taken pictures and maybe even a video tape of the unit prior to or at the time of move in. While this may seem excessive to some managers, it is indeed the best approach, but unfortunately, we all know this is only done by a small percentage of managers. The usual method of documenting the move in condition is the Move In Inspection Form or Condition Report, and for this article we will call it the Condition Report. A thorough manager will have a detailed Condition Report which lists just about anything inside and outside of the unit that the resident could be responsible for or potentially damage. Now here is the big question: who completes the Condition Report? The manager or the resident?

The Resident Completes the Condition Report?

Probably 50% of all managers, especially those who manage multifamily housing units, give the resident the Condition Report and ask them to take the report, write down anything that is wrong with the unit, and get the report back to the manager. The manager then tells the resident that if they don’t get the Condition Report back to the manager, it will be assumed that there is no pre-existing damage to the unit. Sounds reasonable enough right? Wrong. It is not only the lazy way to get the unit inspected, but it can have grave legal consequences.

What Will the Typical Resident Do With the Condition Report?

1. The Picky Resident Some residents will take the condition report and go over the unit with a fine tooth comb, marking down every possible little thing wrong with the unit. When you receive it back, you would think the unit was in terrible condition, and your receipt of the Condition Report from the resident has put you on legal notice of deficiencies. All you wanted the resident to do was mark down any cosmetic issues, but NOW you have a report from the resident which you requested that makes your unit look awful.

 

2. The Wish List Resident Some units are not perfect, but are legally sufficient to rent out. The carpet may not be perfect, and there may be cosmetic issues in the unit. No big deal to the manager, but the “wish list” resident uses the Condition Report to not only tell you about the damages in great detail, but expects you to deal with everything on the list. The resident’s assumption is that you are giving them the Condition Report to fill out, so YOU will know what to fix or change. You have no intention whatsoever to replace the carpet or the countertop, but now the resident feels you should, and by filling out the Condition Report has made the request. Now the resident has an expectation that you are going to have the carpet cleaned again, replace the carpet or give them a new counter top.

 

3. The Sloppy Resident Possibly the carpet has a couple small stains, the walls have a few scuff marks, and there is a chip in the countertop and some deep knife grooves when the last resident used the counter top to chop vegetables with his Ginsu Knives. This is how the “sloppy resident” writes it up on the Condition Report. “Carpeting Stained”, “Marks on walls”, “Chipped Countertops” “Damaged Countertops”. This sounds reasonable to the resident and is in fact true. Now, let us suppose when this resident moves out that there are severely stained carpets, the walls have been marked up so badly that they must be repainted, and that the resident has completely destroyed the countertops. You want to charge the resident for the damage. The manager then goes ahead and charges the resident on the Notice of Intention to Impose Claim on Security Deposit. The departed resident NOW responds back and says, “It was like that when I moved in! Just look at my Condition Report! I told you about these problems a year ago!” The manager is dumbfounded, because while it was true that there was some damage to the carpets, walls and the countertop when the resident moved in, it certainly wasn’t THAT bad. The resident takes the manager to court, the resident shows the judge the Condition Report, and the manager LOSES.

 

4. The Forgetful Resident The resident is in a hurry to move in and the last thing on his mind is to complete a Condition Report. He throws it into the kitchen drawer and it sits there for the next year. The manager never receives the Condition Report. Now the resident moves out, there are damages, and the manager has absolutely no Condition Report to form the baseline as to the condition of the unit. The manager charges the resident for damages, the resident objects, disputing the charges, and maybe the resident claims he did indeed fill out the condition report and get it back to the manager by giving it to your leasing agent who was fired 3 months ago. Worse yet, the dishonest resident finds the blank Condition Report in his kitchen drawer upon move out and decides to fill in the CURRENT damages that he caused during the tenancy, keeps a copy and claims he gave you the original 2 days after he moved in! This resident’s claim, “It was like that when I moved in,” will be hard to beat in court when you don’t have the Condition Report.

The Solution

As you can see by the examples above, giving the resident the Condition Report is just plain wrong, silly, lazy, and the list goes on and on. The manager should be the one who inspects the unit and fills out the Condition Report. You cannot give control over such an important aspect of property management to a person who is not skilled in or has no knowledge of inspecting a unit. The manager knows or should know how to do this properly and will go through the unit marking down preexisting cosmetic damages. Ideally, the inspection and Condition Report will be accomplished with the resident present, but if not, it will be done before the resident moves into the unit along with the video taping of the unit and plenty of digital pictures. Many of our clients, especially the large multifamily ones, insist on allowing the resident to complete the Condition Report. We can assure you that when our client performs the move in inspection and completes the Condition Report, the chance of a security deposit dispute, or in the worse case scenario, losing a dispute in court, is diminished greatly. It is simply the right way to do YOUR job.