The Importance of Walk-Through Inspection for Apartments

The recent article in the Waco Tribune Herald (See below) started me to think about the importance of having a systematic and documented walk-through procedure with all tenants at move in and move out. In this case, a local apartment complex lost a suit against a tenant for damages to an apartment. No formal walk-through was conducted and the entire incident ended up in court with the complex paying nearly $12,000.00 in legal bills for the tenant. Yikes!

The walk-through is a critical part of the lease and it should not be avoided. It is sloppy management to allow tenants to move in without documenting the state of the apartment. I am reminded of the simple procedure that all of us encounter when we rent an automobile. They require you to initial a checklist of any damage to the car. You must take the time to note any scratches, stains or dents so that you're not liable later. This is meant to protect the renter but it also protects the owner.

When a landlord lets a tenant move in without a walk-through, they are starting the relationship on a flawed foundation that is likely to cause problems in the future. There is no "baseline" of the property condition that both parties have agreed upon that would allow you to determine abusive damage upon moving out. Any damage that shows up at move out would be characterized by the tenant as "That damage was there when we moved in". Conversely, the landlord looks at any damage at move out and characterizes it as "damage was caused by tenant during the lease". Hence, a disagreement and a problem that is nearly impossible to resolve, since it is left to a "he said / she said" dispute. The presence of an initial walk-through sheet completely removes this controversy by placing in writing any damages that are present in the property. It is imperative that this be done in writing since a verbal agreement is not enforceable.

The exit walk-through is just as important and is the critical second half of the process. This is where both the landlord and the tenant take the time to walk through the property and identify any new damages to the property, verify that everything is removed and that the apartment is cleaned properly. Our management uses a checklist that spells out the reductions in rental deposit that will happen and the tenant can either correct the problem and receive their entire deposit back or take a reduction in the deposit. IE -> If oven is not cleaned we charge $25.00.

This exit walk-through also needs to be done in writing to protect both the landlord and the tenant from any confusion.This can come back to you in a negative when a tenant leaves under bad terms. It is the proper way to conduct business since it avoids costly disagreements and sets a professional level of conduct.

The beginning and ending walk-through meetings are critical for a property owner's success since it sets a tone that will persist throughout the lease and after the tenant leaves the property. If the manager doesn't do a good job and tries to abuse the tenants with sloppy management and paperwork then the property's reputation is harmed. A good landlord sees the long term benefit of consistently doing a great job with documentation and runs their business as a professional. This is the kind of landlord that will be in business for the long run. Any ill-gotten profit has a way of corrupting the property and only benefiting the owner in the short term.

Highlights from the article is included here:
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Source: Waco Tribune Herald (August 16, 2009) Buzz up! By Cindy V. Culp Tribune-Herald staff writer

2 Waco apartment complexes increasingly taking former tenants to court over damages

Two local apartment complexes have filed lawsuits against multiple former tenants, alleging they caused damage totaling hundreds or thousands of dollars.

Attorneys for the complexes, Saddlebrook and Saddlebrook West apartments in Waco, says the suits are justified. But some targeted tenants claim the apartments are acting unfairly.

During the past two years, the complexes have filed at least 34 suits against former tenants. A few are pending. Some have been dismissed, and others have resulted in judgments for the apartments, with amounts ranging from about $500 to nearly $10,000.

Last month, however, a former tenant prevailed at trial. Baylor University associate professor Sung Joon Jang and his wife had been sued by Saddlebrook West for alleged damage to the carpet and countertops.

The Jangs contend they left the apartment in better condition than when they moved in. Their attorney, Dan Tilly of Waco, tracked down the previous tenant, who testified in court that her family had either caused or inherited the problems for which the Jangs were charged.

The jury ordered the complex to pay the nearly $12,000 in legal fees the Jangs have incurred.

What most complexes do to recover unpaid damages, is send claims to a collection agency. The former tenants then get “harassed” without the benefit of a third-party arbitrator like a judge, he said. Plus, the complexes usually only recover a fraction of the money due, he said.

The Jangs’ experience with Saddlebrook West began two years ago, when the family moved to Waco from out of state. When they arrived, the carpet in their unit had multiple stains, Tilly said.

That was a special problem for the Jangs, since their custom is to remove shoes before coming indoors, Tilly said. They asked the management to replace the carpet but were denied, he said. Another anomaly the Jangs noticed after move-in was a cutting board glued into the kitchen countertop. When they asked a maintenance worker about it, they were told it was normal for the complex, Tilly said.

A year later, when the Jangs’ lease was about to be up, they contacted the apartment’s staff about doing a walk-through. The staff acted surprised that the Jangs wanted to be present for the walk-through, Tilly said, and stalled in setting a time. Because of that, the Jangs ended up vacating the apartment without a walk-through.

Not long after, the Jangs received a letter stating they owed damages totaling about $1,450. If they did not pay within five days, the letter said, they would be liable for more than $4,200 because of fees that would kick in for violating their lease agreement. When the Jangs went to the complex and asked to see the alleged damage, they were denied, Tilly said. The next day, all of the carpet from the apartment was removed, he said.

At trial, apartment staff presented photos they said were of carpet stains. But the photos are so close up, there is no way to know the true nature of the stains, what room they were in or even if they were in the Jangs’ apartment, Tilly said.

In preparing for the trial, Tilly learned the carpet in the Jangs’ apartment had not been replaced since the complex was built in 2001. “The day they moved in, the carpet was 6 years old,” Tilly said, noting that the complex has a six-year depreciation schedule for carpet.

The prior tenant also testified that the kitchen countertop had been damaged when someone in the family set a hot pot on it, Tilly said. She notified the apartment of the damage, she said. The complex chose to “fix” the damaged portion by gluing the cutting board over it, Tilly said. Photos of the burned area underneath the board were introduced at trial.

“What the apartments were doing was rather than pay that as maintenance costs was to charge Dr. and Mrs. Jang,” Tilly said. Tilly said his clients are pleased with the jury’s decision.

Sprigg emphatically denied that the complexes try to avoid doing walk-throughs with tenants. In fact, he said, the apartments’ staff encourage tenants to participate in walk-throughs so any potential issues can be quickly sorted out.