As the new landlord of a California residential property, you still have a lot to learn. For instance, when does a tenant bear financial responsibility for repairs?

Apartments.com differentiates landlord and tenant maintenance responsibilities. Understand how to resolve this aspect of common landlord-tenant disputes.

When tenants pay for repairs

When a tenant bears responsibility for damaging a rental unit, she or he also bears responsibility for paying for necessary repairs. Examples include smoke stains and smells, pet damage, blown-out lightbulbs and worsening issues the tenant failed to bring to your attention within a reasonable time.

Besides cultivating leases that protect you from irresponsible tenants and defining what repairs tenants pay for, you may take additional steps to safeguard your investment in your rental property. For instance, let tenants know they should come to you immediately about repairs, damage and other inconveniences. Taking swift action may keep an issue from worsening.

When landlords pay for repairs

You must also understand when you bear responsibility for repairs. Essentially, landlords take care of maintenance and repairs resulting from standard wear and tear, age and safety hazards. Examples include visible mold, plumbing problems, electrical issues, broken locks when the tenant does not bear fault and heating repairs.

If you do not take action on the above repairs, tenants have the right to withhold rent or hit you with a lawsuit. Look into state regulations to determine how long you have to make repairs. Taking prompt action may reassure tenants and turn them into long-term residents.

Proper knowledge helps avoid landlord-tenant disagreements. Bear the above information in mind during your time as a property owner.

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As Los Angeles continues to struggle with an affordable housing crisis, the Department of Building and Safety and Mayor Eric Garcetti have introduced a program designed to offer fast approval for Accessory Dwelling Units. Developers who wish to build these structures can receive one-day permits for 20 approved design options, compared to up to six weeks for a standard permit.

Review the terms of the ADU Standard Plan Program, poised to change the short-term landscape of Los Angeles real estate.

Basics of the ADU program

Contractors, architects and other real estate developers in Los Angeles can enroll simply by meeting the requirements outlined in the approved standard plans for the ADU program. Participating firms will have direct contact with the architects of the available design options, including the 10 local firms with an eventual total of 28 approved designs.

Available properties

Interested investors, landlords and other ADU owners have options that fit a variety of residents. ADU plans range from studios starting at just 309 square feet to two-story homes of more than 1,100 square feet. Add-on options include outdoor features such as covered patios and decks.

ADU accelerator program

Under a related program introduced by the Mayor’s office in 2019, Los Angeles has attempted to improve housing stability for older adults. Landlords who have eligible ADU units can sign up to offer these rentals to qualified seniors in exchange for stable rental income and landlord-tenant case management.

As the city implements creative solutions to address housing affordability, real estate developers can benefit from these initiatives while supporting the community with access to affordable ADUs.

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Finding renters for your property is arguably one of your biggest challenges as a landlord. Establishing your expectations early on can hopefully minimize discord and encourage compliance.

As you consider renters, use tenant screening to help you identify potential risks. When you learn as much about people as possible prior to accepting them as tenants, you can make a more informed and confident decision.

Aspects of screening

Tenant screening can include a variety of aspects. According to Allstate, ask potential tenants for references. Look at their background and credit history. Assessing such aspects can teach you a lot about people including the following:

• Whether or not they were formerly evicted
• Whether or not other tenants complained about them
• Whether or not they have pending criminal charges or a criminal record
• Whether or not they had difficulty paying rent in the past

While a tenant screening will not uncover everything there is to know about individuals, it can give you a pretty clear picture of what you will deal with. Drawing upon the information you learn; you can assess the risks and determine if prospective tenants will be a good fit for your property.

Handling conflict

Even with tenant screening, you may approve renters that you find challenging to deal with later on. The way you handle disputes can make or break the relationship. One thing you can do is include a clause discussing disputes in your rental agreement. Do your best to maintain open communication with your tenants. If conflict ever escalates to the point where you feel threatened, you may need to scale back and rely on the authorities to assist you.

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Finding tenants for your rental property in California can be one of the trickiest parts of investment real estate. Reliable renters can reduce the need to find new tenants and protect you from vacancy costs. Good renters who want to extend their lease also give you the opportunity to negotiate a higher rent cost.

The key to preventing bad tenants from moving in is the kinds of strategies you use throughout the screening process.

Ask the right questions

Asking questions is an excellent way to learn more about someone. However, you have to practice care in deciding which questions to ask prospective tenants. This is because the Fair Housing Act prohibits illegal questions based on a person’s race, gender, sexual orientation, disability and other conditions. According to The Motley Fool, you can ask questions about why they wish to move from their current residence, if they can afford your costs and whether or not they have pets.

You can also ask permission to contact former landlords and whether or not a prospective tenant has recently filed for bankruptcy protection. Questions about pending criminal charges, past evictions, income stability and the number of people planning to move in can help you make a confident decision about how to proceed.

Outline your expectations

Another helpful way to encourage good tenants to rent your property is to clearly outline your expectations. Discuss the terms and conditions in your contract and the consequences of a broken lease agreement. Inform prospective tenants of how you will proceed with an eviction if they do not honor the contractual agreement in place. Outlining your expectations from the start can encourage your tenants to abide by your terms and avoid unruly behavior.

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You have every right to start eviction proceedings when a tenant fails to pay rent, but in some situations, you may want to try something else before you take this step. This is especially true if you have a positive history with the tenant or are aware that he or she has become unexpectedly insolvent.

However, you should react to protect yourself. Mondaq explains that you want to minimize your loss in this situation, which means you should consider your next moves carefully. You do have a few options beyond filing an eviction.

Change lease terms

You can alter the lease to make it easier for the tenant to conclude his or her business and vacate the premises. Commercial leases often have conditions that can make it hard for a tenant to wrap up a business. You can waive certain requirements to allow the tenant to more quickly close the business and move on.

End the lease early

If you fear your tenant will file bankruptcy, then you may consider ending the lease early. You may have to pay to get out of the lease, but that may not be as much as you would lose if you wait things out. Once the tenant files, it will be difficult to get them out of the space so that you can find new tenants.

Grant relief

If the tenant has always been good about paying rent on time and you can afford it, you could simply offer to defer or even forgive late payments. If you do this, you will need to make the exact terms clear to the tenant. Do not allow room for the tenant to later claim that you removed the obligation to ever pay rent again.

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Commercial real estate investing can be quite lucrative. If you want to get your start in this venture, you need to have a plan that will help guarantee your success. 

Real estate is a very unpredictable market. It can help you to become a better investor if you gain some background in the industry first. Million Acres suggest starting out working in commercial real estate first, such as becoming an agent or broker. 

Working in the industry

By working in the industry, you can learn a lot about deals and different investing options. You will get insight into how people make deals and their expectations and some ideas about leases. It can provide you with a great hands-on education that you cannot get any other way. 

You can then use the knowledge you gain to help in your own investments once you are ready to take the jump and become an investor. 

Making a deal

Before you jump into a huge investment, you should try something smaller. For example, you could flip a property. This will give you practical experience in various areas, such as permits, contracts and budgeting. 

Plus, you will be able to see what it takes to manage a project. It will help you to learn whether you like this industry or if you would rather deal with residential properties. 

Any exposure you can get to the commercial real estate market will benefit you as you enter the industry. Your goal, in the beginning, should be more about learning the ropes than making large amounts of money because it takes knowledge to work your way up to becoming a success in this field.

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The excitement builds as you make plans for starting your own business, but there are so many things to do and decisions to make.

Be sure to avoid basic mistakes, such as forgetting to protect your intellectual property and failing to secure your interests with written agreements.

Taking a short-sighted approach

Avoid taking a short-sighted approach to the future of your business. You should have a long-term plan in mind from the very beginning. Think about what you want your business to be in one year, five years or ten in terms of financial goals, future products or personnel.

Underpricing products or services

As with overpricing your products or services, underpricing can cause serious problems. Keep an eye on competitors. Make comparisons with the pricing of similar products and claim your space in the marketplace.

Failing to protect intellectual property

Remember the importance of your company name, logo, sensitive documents or photos. You may need to file for a copyright, trademark or other legal protections for your intellectual property.

Avoiding the use of written agreements

In large part, the days of securing an agreement with a handshake are over. Do not depend on casual business relationships always panning out. Drawing up written agreements with employees, partners, suppliers and anyone who provides services will protect your business interests, ensure accurate record-keeping and help you prevent legal missteps.

Relying on professional help

From bookkeeping tips to reviewing documents such as non-compete agreements and employment contracts, you will need professional guidance as you launch your business. Having timely professional assistance will help you avoid business startup mistakes and confidently clear any hurdles that arise.

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Investment partnerships allow companies to optimize their resources by combining competencies and experience. When leveraged appropriately, a professional partnership provides opportunity and value to all participants.

Because people have different opinions, situations may arise where decision-makers cannot agree on the same course of action. Collaborative communication can prevent this difference in opinion from spiraling out of control and causing damage to a partnership’s synergy.

Determine charge

A host of professional disputes begin because of misunderstandings regarding decision-making authority. According to Business News Daily, participants in a partnership should make fair and clear determinations about leadership roles. These designations can include topics such as buyout rights, monetary distributions and ownership rules.

People in charge of making critical decisions have the responsibility to make informed and educated choices to protect the investments of the other participants. Others can voice their opinions which can encourage healthy negotiation to determine the best course of action. However, once decision-makers determine a final outcome, everyone else should offer support.

Listen with intent

There will undoubtedly be times when disagreements arise in a partnership. This is not uncommon and not all bad. When people understand how to listen to each other and respectfully communicate, they can embrace each other’s differences and reach an amicable and rewarding solution. According to INC., intentional listening plays a big role in collaborative communication.

During discussions, people should listen to each other and resist the urge to mindlessly begin forming their response while the other person is talking. They should refrain from interrupting. When it is their turn to talk, people should reiterate their understanding of the other party’s concerns.

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Leasing real estate to commercial tenants in California involves a certain degree of risk. As a commercial landlord, you may do everything in your power to minimize how long your space stays empty. A potential way to prevent a tenant from breaking a lease term involves including a sublease clause in your commercial lease.

According to the California Department of Real Estate, a sublease clause allows a tenant to transfer its right to a portion of premises, or the entire premises, to another entity for part of the existing lease term.

Understanding liability in subleases

In some ways, a commercial sublease clause favors the lessee by giving that company an out if the lease no longer meets its need. However, in the event that a subtenant fails to keep up with the terms of the lease, the original tenant is on the hook for what the subtenant failed to pay.

Subleasing to financially secure subtenants

Many California commercial leases allow tenants to sublease their spaces to other entities. However, certain conditions must exist to do so. Before a tenant may sublease to another entity, it must be able to prove that the new subtenant has the financial stability needed to cover the expenses associated with the commercial property.

As a commercial landlord, your own duties and responsibilities do not change much when you allow a tenant to sublease your space to someone else. If your lessee sublets some of your space to another entity and that company damages the space, for example, it becomes the duty of your original lessee to cover associated costs.

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Easements give other people some right to your property. This may seem unfair, but according to SFGate, easements are a fixture in property law, and they prevent a property from becoming worthless due to lack of access.

There are many ways that someone may create an easement, and if you do not control the process, it could result in loss of rights to your own land.

Providing access to another property

If a person or entity on the other side of your property does not have access to a public road except by going across your property, an easement may be necessary. By granting an easement, you can control how and when the neighbor can use your property. Because you are voluntarily allowing the easement, you can put terms and conditions for the use in writing and legally limit your neighbor’s access to the minimum amount necessary.

Allowing use without your knowledge

You may have an easement on your property without knowing it. If the person who owned the property before you divided the land and sold it to you and another person, there may already be a private road in place. Your neighbor could be using the road without either of you knowing that he or she is using your property. If your neighbor’s property is commercial real estate and significant traffic or even heavy equipment crosses your property, it could take a toll on your land. Not only that, if your neighbor takes certain steps, you could lose your rights to control the land.

Becoming a permanent legal easement

A prescriptive easement occurs when your neighbor uses your land continuously for five years without your consent, and a reasonable person would have known that it was happening. A court may then rule that your neighbor’s use is legal, even though you never granted an easement. Thus, you cannot claim your neighbor is trespassing on your land if you decide you do not want the use to continue.

Reviewing your property boundaries on the official description in the deed can help you to see where an implied easement may exist so that you can set your own parameters on its use.

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