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Protecting Your Investment with a Move-Out Checklist

Protecting Your Investment with a Move-Out Checklist
It is best to plan ahead for every part of the rental process as a landlord, including move-outs. Most tenants and landlords have heard of the practice, but not everyone understands what a move-out checklist should include. Thus, we have compiled a comprehensive explanation of the process from notice to vacate to new move-in.  We discuss why a move-out checklist is essential and what a move-out checklist must include helping landlords protect their investment. Read on below to find out more.

What is a Move-Out Inspection?

The move-out inspection is typically completed within 48 hours of the move-out. This serves as a comprehensive evaluation of a property’s condition once the tenant vacates. Compared to the move-in inspection, the findings will determine if any damage is beyond normal wear and tear.
 
This is vital because damage determined as above normal wear and tear allows landlords to deduct from the security deposit. By law, landlords have a set period of time to return the deposit to the tenant.  Landlords will want to check their local laws, but it typically is around 30 to 45 days after move out. For efficiency and record-keeping, the best way to perform a move-out inspection is to use a checklist.
 

Why is a Move-Out Checklist Important?

 
Along with photographic evidence, a checklist ensures each area receives the review, and everyone is on the same page. Ideally, this checklist will mirror the move-in inspection for easy comparison to determine damage. Additionally, inspecting the unit also provides an accurate estimate of the time it will take to complete the unit turnover.
 
Unfortunately, some tenants may disagree with or deny the damage found. These types of disputes can land both the tenant and landlord in mediation or even court. A move-out checklist serves as vital evidence in case a dispute arises over withheld security deposit funds.
 

What is Tenant Damage vs. Wear and Tear?

 
The goal of a move-out inspection is to determine the overall condition of the property. This process is to see what normal wear and tear versus damage the tenant may have caused. Normal wear and tear occurs as the property fixtures and systems naturally age. Since this is not caused by neglect, landlords must address wear and tear at their expense. That said, damage is the result of abuse or neglect by the tenant. In this case, the tenant is responsible for repairs or replacement of damaged property. Below are a few examples to illustrate the difference.
What is Tenant Damage vs. Wear and Tear?
Carpet
Carpet in a rental property can show wear quickly. Normal aging will manifest as worn patches in high-traffic areas, but there should not be any holes or stains. However, carpet with tenant damage will be heavily stained, ripped, or show evidence of pet damage.
 

Hardwood Flooring

When hardwood or laminate flooring has normal wear, there are possibly some light scratches or fading from prolonged sunlight exposure. If the floors have deep scratches or damaged pieces, the tenant is responsible for the damage.
 

Tile Flooring

Tile is a very durable material for use in rental properties. Any broken, missing, or chipped tiles are the tenant’s responsibility to fix. That said, dirty grout or scuff marks on tile is simply normal wear and tear.
 

Countertops

Depending on the countertop material, light scratching or watermarks are the results of normal use. However, damaged corners, chipping, burn marks, and larger stains are signs of tenant damage.
 

Walls and Paint

Rental properties experience more movement of furniture than average homes, and with that, walls suffer. That said, slight cracks from settling or scuff marks to the paint are expected. If walls have holes, large scuff marks, or are an unauthorized paint color, tenants are responsible for correcting the issues.
 

What Should a Move-Out Checklist Include?

 
An effective move-out checklist is thorough, tailored to the property, and, most of all, organized. By creating a move-out checklist for your properties, it ensures a smooth and efficient process. The best way to begin is by breaking the property down room by room. Let’s take a look at how to create a great move out checklist.
What Should a Move-Out Checklist Include?

A Move-Out Checklist Should Include

  • Rental Property Address
  • Tenant Contact Information and Forwarding Address
  • Field for the Move Out Date and Date of Inspection
  • Individual Sections for the Items in Each Room of the Property
  • Additional Blank Fields to Record Notes or Special Room Features
  • Larger Space for Documenting Comments
  • Places for Every Tenant and the Landlord to Sign

 

Common Mistakes to Avoid with Move-Out Inspections

Move out checklists are a necessary and excellent tool for landlords, but only if used correctly. So, to make sure you do your part as a landlord, avoid these common mistakes.
  1. Clear Communication – One of the biggest mistakes landlords can make is not properly communicating the move out process to their tenants. Tenants are busy packing and moving, so be sure to schedule the inspection ahead of time so everyone is on the same page.
  2. Premature Promises – Never promise or discuss how much security deposit a tenant will receive before the inspection. Only a thorough inspection will reveal damages that could jeopardize the deposit.
  3. Incomplete Information – Detail matters! As a landlord, ensure the inspection checklist is easily understood, and both clear descriptions and photographs document everything. This protects you in the event of a disagreement on the condition.
  4. Inaccurate Charges – The move out checklist is a landlord’s proof of the home’s damage and the subsequent repairs needed. A failure to accurately or completely logging these charges could prove detrimental if there is a dispute. So, take care not to forget any items.
 

Sample Move-Out Checklist

Unsure how to prepare a checklist for your rental property? Check out this printable sample of a move out inspection checklist.
Move-Out InspectionMove-Out Inspection Pg 2
 
Ideally, both the landlord and tenant should take the time to be involved in the move out inspection. Whatever format of checklist you choose, landlords must ensure a thorough evaluation is performed. Also, keep in mind, this must be completed before the security deposit is returned. Facilitating the move-out, marketing, scheduling turnover, and releasing of a property is a time-consuming process.

You Received a Notice to Vacate, Now What?

When a notice to vacate is received, landlords must jump into action to secure a new tenant. Move out inspections are only a portion of the process. The entire process involves paperwork, scheduling repairs, marketing, showings, and more, all of which must be done promptly. To help guide you through the steps involved, check out the list below.

You Received a Notice to Vacate, Now What?

  1. Finalize the Move Out Date with the Current Tenant
  2. Evaluate the Local Competition and Begin Marketing
  3. Schedule and Complete the Move-Out Inspection Checklist
  4. Complete Turnover and Repairs
  5. Disburse Security Deposit to Former Tenants
  6. Test Smoke and Carbon Monoxide Detectors and Service HVAC System
  7. Determine the Move-In Date for New Tenants
  8. Sign the New Lease
  9. Collect the Security Deposit, First Month’s Rent, and Other Fees
  10. Provide New Tenants with a Welcome Packet
  11. Complete a Move-In Inspection Checklist with New Tenants
  12. Follow Up

Finalize the Move-Out Date with the Current Tenant

Once your tenant has expressed their intent to move, finalize the date and time they will vacate. This is invaluable information as it aids landlords in pre-scheduling turnover work and inspections. Also, having the move out date allows you to set an availability date to begin marketing as soon as possible. Any steps a landlord can take to avoid extended vacancy is for the best.

Evaluate the Local Competition and Begin Marketing

Pre-leasing before the current tenants leave is a great way to limit vacancy time. Check out the local competition and adjust your desired rental rate so it aligns with the area. It is good to begin marketing 30 to 45 days before the current tenants move out date. Just be sure to allow yourself enough time to complete the turnover. Depending on the time of year, overall condition, or how many properties you have, turnover may take as little as a few days up to a few weeks. Either way, make sure you do not set an availability date you cannot deliver on.

Schedule and Complete the Move-Out Checklist

Ideally, the current tenant and landlord complete the move-out inspection on a mutually agreed upon time and date. This is your opportunity to document any suspected tenant damage and evaluate added repairs needed before the next move in. Take your time and take either photographic or video evidence to capture the condition of the home thoroughly. Not only does this determine what, if any, deposit is held but helps to avoid possible disputes.

Complete Turnover and Repairs

Complete any necessary repairs as determined by the inspection or local compliance laws. Standard turnover repairs include fixing the damage, completing renovations, a fresh coat of paint, changing HVAC filters, and re-keying the locks. It is also a good idea to hire a professional cleaning service if your budget allows. If a lead test is required, consider scheduling in advance to ensure services are available when you need them. Use only trusted vendors familiar with the quick turnaround rental properties rely on.

Disburse Security Deposit to Former Tenants

Once damages and repairs are determined, the remainder, if any, of the deposit can be returned. By law, landlords have a finite timeframe in which to do so, typically 45 days. If you opt to deduct, be prepared to provide itemized receipts documenting all charges.

Test Smoke and Carbon Monoxide Detectors and HVAC System

Most local jurisdictions require landlords to have working smoke and carbon monoxide detectors. In between each tenant, take this opportunity to make sure all units are functioning properly. Equally important is servicing the HVAC system to ensure it is operating efficiently and at its full potential. If any issues arise, address them immediately.

Determine the Move-In Date for New Tenants

As potential tenants apply and are approved, verify their desired move-in date falls in line with your projected availability date. Be sure to clearly communicate any delays in completing repairs that may jeopardize tenants moving in on time. Remember to always give yourself a little cushion when setting the initial availability date, just in case issues arise.

Sign the New Lease

As a legally binding agreement, this is one of the most important steps. Take time to review the terms, clauses, rules, and any addenda carefully with your tenant. This signifies all of the details each party agrees to, so each side must understand their role and responsibility.

Collect the Security Deposit, First Month’s Rent, and Other Fees

Once the lease agreement is signed, collect all the necessary funds. All funds should clear before handing over the move in keys, so money orders or cashiers’ checks are best. It is also a good idea to require the rent to be separate from any security deposits. Some jurisdictions do not allow commingling of funds, and instead, deposits must be held in a separate account. Therefore, check your local laws and landlord requirements before accepting commingled funds.

Provide New Tenants with a Welcome Packet

Making tenants feel at ease in their new home is a solid foundation for a great landlord-tenant relationship. So, provide them with all of the key information they will need in one easy to read packet. Include a personalized welcome letter along with the essentials such as:

What to Include in a Welcome Packet?

  • How to set up utilities
  • Acceptable ways to pay rent
  • How to report maintenance issues
  • After hours emergency phone numbers or contact
  • What to do if locked out
  • Parking information
  • Trash disposal and recycling schedule
  • Owner or property manager contact information
  • Community rules or expectations
  • Neighborhood interests such as restaurants, nightlife, cultural attractions, or stores

Complete a Move-In Inspection Checklist with New Tenants

The move-in inspection is what is compared with the move out inspection to determine damage. Therefore, each time a tenant moves in, complete a new move-in checklist and take either video or photographic evidence of the property. This should be completed with the tenant so each party can sign off and receive a copy for their records.

Follow Up

To further enhance the landlord-tenant relationship, do not forget to follow up. Even with a welcome packet and the best intentions, questions still arise as tenants settle into their new place. As a landlord, reach out to tenants anywhere from 1 to 2 weeks after move-in. Check in to see how they are doing, ask if there are any further questions, or address any concerns. This simple gesture can go a long way in keeping your tenants satisfied with their decision.

Are you looking for a qualified property management expert to take away the stress? Bay Property Management Group is the area’s leading full-service property management company. Our in-house maintenance technicians perform inspections while providing owners with comprehensive estimates. Reach out to one of our dedicated staff members to learn more about the benefits of professional rental management services.