Are you worried about the risks that come with renting out a home?
There’s a lot of liability involved. Not only are we talking about an expensive piece of property, but also the fact that there are tenants living in that property.
One of the best reasons to partner with a property management professional is to mitigate your risk and reduce your liability. We have processes and protections in place that will ensure you don’t have to worry about easy legal mistakes, loss of rent, or property damage and deterioration.
Let’s take a look at some of the key risks and how to mitigate them.
Quick Overview:
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Potential Injuries on Your Property
Imagine a tenant falling down a flight of stairs because a floorboard was loose or a hand rail was pulling away from the wall. What if a mail carrier is attached by your tenant’s dog that you approved for the property?
When someone is hurt living at or visiting your rental property, the liability can quickly fall on you, the property owner.
You’ll want to have a comprehensive insurance policy in place, which includes liability coverage.
Your liability as a landlord depends on the condition of your property. Tenants can sometimes get hurt, and it’s completely their own fault. However, it immediately becomes your fault when there’s a maintenance problem that wasn’t addressed or a danger like poor lighting. That’s the point at which you can find yourself liable for the injuries caused by these conditions.
You might get sued, and most lawsuits at rental properties are due to uneven or slippery floors, bad lighting, uneven staircases, and unsafe pools. Make sure you’re conducting frequent safety inspections.
Habitability Issues are a Liability
As a landlord in Las Vegas or anywhere in Nevada, you’re legally required to provide a rental home that’s safe, habitable, and well-maintained.
The implied warranty of habitability is a legal requirement that ensures rental properties are safe, livable, and meet basic housing standards. This warranty is automatically included in every residential lease, regardless of whether it’s written into the lease agreement. Under Nevada law, landlords must provide essential services such as:
- Functioning plumbing
- Heating
- Electricity
- Clean water
And, a home that is free from hazards like mold, pests, or structural damage.
Failing to uphold this warranty can expose you to serious liability. Tenants have the right to withhold rent, terminate the lease, or even pursue legal action if the landlord neglects repairs that affect the property’s livability.
When a maintenance issue needs your attention, make the repair or replacement quickly. This will minimize the chances of a tenant complaint, a claim, or an escalation that can lead to a larger conflict and a lot of liability.
As the owner, you are the party responsible for maintenance and habitability, but you can also set some expectations for your tenants. They should have their own set of responsibilities when it comes to helping you keep your property maintained and clean. They can be expected to change air filters and take out trash, for example.
Put together a maintenance plan that includes responding to repair requests right away, communicating openly with your tenants, conducting routine walkthroughs, and staying up to date on all habitability laws, municipal codes, and local requirements. This will limit your liability when it comes to habitability.
Nevada Rental Property Owners and Legal Liability
Nevada is a fairly landlord-friendly state. But there are still rental laws on the books that must be followed, otherwise you’re looking at potential discrimination claims or lawsuits that you’ve violated a state or federal law.
We do not have rent control in Nevada, although there has been talk about capping increases on people over 62 years of age or those receiving social security as their main source of income. But no laws have been passed yet, and unlike in many other western states, it isn’t difficult to evict a nonpaying tenant or take your property back for any reason once the lease ends.
But, tenants still have a number of protections. If you violate their rights, you’re inviting a lot of legal liability into your life and relationship. You need to have at least a basic understanding of the local, state, and federal rental laws so you don’t violate those laws.
Here’s where you’ll find the most liability when you’re renting out a home:
- Fair housing laws. You cannot discriminate when you’re screening or advertising or collecting late fees. Do you know the difference between a pet and a service animal? The difference between a service animal and a companion animal? There are seven protected classes under the federal Fair Housing Act, and you have to make sure you aren’t violating the law by using the wrong word in your listing. You might not think you would ever discriminate intentionally, but even a perceived unfairness can cause problems for you.
- Security deposit laws. Nevada has specific laws around security deposits. For an unfurnished property, you cannot charge more than the equivalent of three months’ rent as a security deposit. There are also requirements around how quickly you have to return them and what you can use the tenant’s money for after they move out. What can you deduct from a security deposit? It’s important for you to understand the difference between wear and tear and tenant damage when reconciling the security deposit at the end of a lease term. You also need to know the timelines. Landlords must return the security deposit, or the remaining portion after deductions, within 30 days after the tenant vacates the property. If you withhold any money from that deposit, an itemized list of deductions will be necessary.
- Eviction laws. Evictions are more complex than ever before. When tenants don’t pay rent or they’re found to violate the lease agreement, there’s a specific legal process that must be followed before you can take them to court and remove them from your property. You cannot change the locks, turn off the utilities, or confront them and fight. Even a minor mistake in the eviction process can get your case thrown out and your process back to square one. Avoid the liability of an illegal or unlawful eviction.
There are so many easy ways to make a legal mistake without even realizing it. It’s risky to rent out a property without the help of a property management company in Las Vegas, Henderson, or wherever you find yourself in Nevada.
Criminal Activity in Your Rental Property
Your lease agreement, if it’s strong and comprehensive, will prohibit criminal activity in your rental property. Hopefully, you’re screening your tenants well enough that any prior convictions will show up on the background check.
Even with a strong lease and a good screening report, you might find that a crime has been committed or there’s ongoing criminal activity happening at your rental property.
What do you do? What if there is violence? Or drugs? What if other, neighboring tenants are in danger?
First, make sure you’re able to prove it. And if you can prove it, evict your tenant immediately. There has to be a zero-tolerance policy when crimes occur at your property, otherwise the law can see you as complicit in that criminal wrongdoing.
In Nevada, landlords can evict a tenant for criminal activity committed on or near the rental property, especially if it endangers the health, safety, or quiet enjoyment of others. This includes drug-related offenses, violence, or illegal use of the premises. Your most immediate step is to serve a Three Day Notice to Quit for Unlawful Activity. This does not offer the tenants an option to cure the violation.
If the tenant fails to vacate, you can file for eviction through the court. Proper documentation of the criminal conduct, such as police reports or witness statements, is critical to support the case and ensure compliance with Nevada eviction laws.
Pets and Landlord Liability
Generally, we believe that providing pet-friendly rental is a good idea. However, pets can certainly bring more liability into your rental home.
If your tenant’s dog bites someone, the tenant is legally responsible for that dog and any injuries that it causes. But, the courts can rule that landlords, because they are aware of dogs and have approved those dogs, have a duty to protect people against injury that can potentially be caused by the animals.
Your insurance company will likely have a list of dog breeds they consider dangerous. Make sure you heed this list when you’re making decisions on which pets to allow.
A strong pet policy can limit the amount of liability you have around the animals that your tenants are moving in with. You can also require that your tenants buy additional insurance for their own renter’s insurance policy when they have a pet.
Please contact us at New West Property Management to talk about how we can help you reduce your risk and liability. Our team expertly manages residential rental homes in Las Vegas and throughout Clark County, including Henderson and North Las Vegas.
