As Real Estate Investors Balk at being Inspected, the Media Provides Stories of Why They Should Be
Most real estate investors know that certain regulations in their state applies to them. Hopefully, there will be a balance between protecting the landlord (real estate investor) and the tenant. Many investors are finding that some rules are favoring the tenant, in order to ensure that they have a good place to live. Some communities have taken an extra step which has angered many: forcing landlords to have their properties inspected.
This trend of having home inspectors investigate dwellings has been growing. From the reports that I have seen, few large cities have gone to this means of protecting the consumer. Each day appears to bring a report of a smaller municipality enacting this rule though. This has caused an added expense that investors had not expected. I have not seen this happen in Texas yet, but we may see such codes being debated in city councils across the nation.
With the housing crisis continuing, government (at various levels) will look at protecting the tenant over the investor, and large cities will not be immune from this desire to protect the tenant. Another factor which may drive such legislation could be news stories. Yesterday in Houston, two children died as a stairwell collapsed on them. A third child may never be able to walk again. The complex is now being examined by building inspectors as the public watches.
Finding ways to protect the public will be foremost in the minds of officials as such stories are related. Investors can take steps to protect themselves. One simple measure is to have a routine with documentation which shows what is being found. A normal basis, this should be part of your business plan. Civic associations have been suing landlords who do not take care of their buildings.
If you find that you community is about to enable such a rule, you may wish to work out a plan with a local home inspector. If you have several units or several locations, you should look into finding an arrangement to help reduce costs. Many inspectors will give a discount if they know that they could have steady work over a period. Wait till the legislation passes, because they may make a determination that a fixed price for the inspection is in order.
In the end, being a responsible landlord/investor can be the only method to keep your business on track.
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