(Proverbs 14:4)
I remember several years back we had a couple come in and apply
to rent a home from us. They had eight children
and seemed abnormally well-rested and together.
I was an admirer of these parents who were gracefully taking care of
business with almost three times the youth constituency I’m currently trying to
navigate. Warriors!
This was going to be a full house! Fair housing laws prohibit
any type of discrimination based on family size, so the sheer number of inhabitants
wasn’t a factor on their application decision.
But common sense dictated that a house with ten people was going to have
more wear than a house with two. And wear
on a house costs landlords money.
In rental home poker math, a pair should beat a full house. Less occupants means there is less potential
for things to break and be worn down. Avoiding
and accounting for wear has come more to the forefront as repair and renovation
costs have skyrocketed post-COVID.
I started to think about the wear assumption while I was out
in the field doing interior home inspections earlier this month. I hadn’t done this many personally since
pre-COVID and things were different this time around! I visited around 25 rental homes during business
hours and was shocked that 85% of the homes had people present. Schools were in session and it was not a holiday
of any sort. I thought most people would
be working outside of the home. This was
not the case.
The last time I was out doing inspections, almost all of the
homes were vacant when I stopped in; the process was sort of robotic and
boring. This time it was nice to be able
to see some of our tenants and talk. But
it was unexpected. And it made me think
of how much more foot traffic these houses take now than then.
Wear is probably less of a function of how many people are
in a house, but how many hours people are in a house actively using it. So if ten people are living in a house but
travel for work and school most of the week, there is not going to be much
wear. But if these ten people never
leave the house, the wear rate would be very high.
When calculating wear expenses for deduction from a tenant security
deposit, property
managers will use general guidelines for the life of new carpet or paint
(typically 7-10 years); these guidelines have been around for a long time. But if adult tenants are not leaving their
homes during work hours, should these numbers be adjusted downward (6-9 years)? Rental homes are incurring a higher rate of
wear after COVID jolted the work system and it’s not cheap to renovate.
Wear rate will never be an exact science! I remember doing the walk-through after the aforementioned
ten-person family vacated after several years of occupancy. The home looked better than it did
when they moved in. Go figure.
But, generally-speaking, wear has increased in rental houses
post-COVID. Smart landlords will
reassess their security deposit deduction guidelines periodically as wear has
become an even larger expense driver.
Happy Landlording!
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