Whether you’re a new landlord or an experienced one, it’s important to be crystal clear about what you’re required to do by law.As a landlord, your rights and responsibilities are paramount. If you are considering structuring your rental properties as a business, especially in the Empire State, understanding how to establish an LLC in New York could potentially provide some protection and tax advantages.
This article will review a few of the key responsibilities that landlords need to know to abide by the law. Keep in mind as you read these laws that every state’s laws vary. The following are general, federal rules and regulations, but in order to be fully compliant, read your state code thoroughly.
It’s imperative that you provide a safe and habitable home for each of your tenants. In order to treat your tenants fairly, you need to maintain a certain expected level of maintenance in your properties. Make sure that you’re up to date on all health and safety codes in your area, and keep in mind that many states allow tenants to withhold rent if you neglect certain responsibilities around the property.
No one wants to evict a tenant. Besides the process being monetarily and emotionally taxing, there are many technical eviction laws that are dictated by both the state and federal government. Make sure you’re keeping up on what your local regulations are to make sure you’re within your rights.
In all 50 states, it is illegal to discriminate against a tenant based on the federal Fair Housing Act protected classes, which are race, color, familial status, religion, nationality, disability, and sex. Additionally, under the United States’ Americans with Disabilities Act (ADA), disability rental rights are outlined and require landlords to provide “reasonable accommodations” to tenants who have documented disabilities. Reasonable accommodations do not mean the tenant is not responsible for paying rent or maintaining upkeep of the property, but you cannot evict a tenant for requesting them.
Another national eviction law is that no landlord in the United States can evict a tenant in retaliation, or as revenge for the tenant taking any sort of action against you.
Landlords must tell their tenants certain information by law. Each state varies in exactly what information must be disclosed, but some common required disclosures are recent flooding, existing property damage, and the identity of the property manager. It’s also common for the landlord to give their tenant a summary of their state’s landlord-tenant laws or data from registered sex offender databases.
It’s also important that your tenants are aware of local regulations pertaining to rent control. Although your state most likely already requires landlords to disclose this information, make sure that your renters know about any caps or restrictions on rent increases.
Rent and Security Deposits
Currently, only five states have rent control regulations. These states are New York, California, New Jersey, Maryland, and Oregon. The states do not allow landlords to increase rent by more than 2-10%, depending on the state.
As for security deposits, they are unregulated in 20 states across the country. In the rest of the nation, a landlord is prohibited to charge more than one to two months’ rent, again varying by state. Also, some states require landlords to pay interest on their tenants’ security deposits. Make sure, as always, you check with your local laws and regulations before enforcing your security deposit policies.
Additionally, several states have limits on late fees. Many states have clearly defined limits, but generally the rule is that the late fee must be “reasonable” enough to hold up in court. “Reasonable” usually means that the fee is less than 5% of the rent amount and cannot be charged before a grace period of 3-5 days.
Rules and regulations for landlords can get confusing. Although general laws can be helpful, it is part of your role as a landlord to know exactly what your rights and responsibilities are when it comes to housing tenants. Being fully informed on these issues is the only way to ensure you’re treating your tenants fairly and legally. Not only will knowing these laws keep you out of legal trouble, but abiding by them will maintain a good reputation in your local market for being a good landlord.