Washington, DC · Member since 2018 · 65 posts · 35 votes
Hi all!
I need some advice. This has never happened to me before and I'm not sure how to handle it. When I went today to have my current tenants sign another one-year lease, I did an inspection of the property. To my surprise, they built a kitchen (electric stove, sink and refrigerator) in the downstairs wash room.
When I asked where the washer and dryer was, he said upstairs. They had redirected the plumbing and electrical and installed the washer and dryer upstairs!!
Now, I'm no dummy. Clearly, if you are installing a kitchen/kitchenette in the basement you have plans to move someone in (not on the lease). That's actually the least of my concerns. I'm concerned that if something happens to the property (electrical fire, flooding, ...) as a result of these new installations, I will be left S.O.L.
What are my steps to protect myself and my property? I'm thinking step one is to get someone out to ensure the work is up to code AT THEIR EXPENSE...Please help!
*Also, I don't want to evict them because I'm getting top rent for the area and they always pay on time...through covid and all...
Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
6y
At this point you should get it inspected to make sure it is to code.
If it meets code you could leave it this way till they move. Then have them restore it they way it was using a licensed contractor or accept it they way it is.
If it doesn't meet code you can have them pay a licensed contractor to make it to code or have them restore it immediately to the way it was.
A tenant that takes care of the house and pays market rent on time is worth trying to keep.
So get it inspected and then decide which way to go.
I'd let them know you are going to step up inpections. This way you'll know if they try and move someone in that is not on the lease.
Investor · Tampa, FL · Member since 2017 · 589 posts · 251 votes
5y
Any improvements should be in writing by the landlord which is you. They Must return it back to the way it is to avoid the breach of lease. If not the certainly will take advantage of you and will most likely rent out the basement...
Toledo, OH · Member since 2015 · 17 posts · 25 votes
5y
There are huge fines in Toledo OH if you don't pull a permit before work begins. You would be the one they come after, so you may want to get the work checked by a licensed contractor, then ask them to pull the permit and have it inspected. That way you don't have to worry about getting a huge fine 6-12 months down the road. And if there is an electrical or plumbing issue, w/o the permit the insurance may not cover the problem. You are on the HOOK
New to Real Estate · Alexandria, VA · Member since 2018 · 9 posts · 1 vote
5y
@Tomiko Graves, out of curiosity, why did you choose to have them retore the changes back to its original state if you didn't think that the changes were material? I understand the risk aspect of it, but since you are asking them to hire a contractor and inspector at their expense why not have them go through the permit process and leave them there?
I mean no disrespect, just hoping to learn from your experience and perspective.
Wow. Thanks for all the suggestions and input! After careful consideration, here's what I did:
I called and sent a follow-up email stating:
1) Restoration has to happen by Oct. 17 (2.5 weeks from now)
2) Inspector (of my choosing) has to come out once restoration occurs (at their expense)
3) Quarterly inspections will start (Feb, May and Aug)
I decided NOT to evict as long as restoration is done by Oct. 17. I let them know that the violation warrants termination but because of .... I'm letting them stay. I did say that if anything like this happens again, the lease will be terminated.
I'll let you know what happens by Oct 17...
Thanks again everyone!!
This is perfect. I have a feeling they'll do what you want. Finding quality housing in the DC area is not that easy. You are obviously providing it. If they don't cooperate, get them out, but it's good you gave them a chance.
Attorney · WI · Member since 2020 · 4 posts · 4 votes
5y
As a lawyer, my perspective is that the biggest issues with this situation are your potential liabilities - and there are a host of areas where you could be liable, as many of the comments have pointed out. From fines for non-permitted work, no insurance coverage for unauthorized improvements, to injury/death liabilities for constructive knowledge of defects. It sound like you took the best approach under your circumstances. By requiring restoration and professional inspection you have protected yourself from all these unknown potential liabilities.
Whether the tenants are good tenants or not, and whether they respect you or not is far too complex to discern from what limited information you provided up front. If it is higher-end property in very nice condition, they are paying higher market rents, and all signs are clear that they take impeccable care of the property, and the improvements appeared to be very high quality, you may have a very different situation than the tenant who paints over duct-tape to "restore" a hole they put in the wall. It sounds like these tenants have respected your position, so perhaps they are good tenants after all, and made a naive mistake. I've seen my share of tenant's sheepish "well, I didn't really think about it that way..." that to a property owner just defy any rational explanation. Some of them were obvious lies about horribly unacceptable alterations and others were a little more nuanced situations that were clear overstepping of the "leasehold" rights, but correctable while maintaining the tenant.
Those comments about never using the security deposit for costs mid rental term stream - absolutely! Chances of collecting additional damages after a tenant is gone often require legal action - a waste of time and resources if you can avoid it.
Attorney · New York City / Long Island, NY · Member since 2020 · 597 posts · 248 votes
5y
Please keep us posted on what happens. Definitely run this by your attorney now, regardless of what happens because "you don't know what you don't know" - but your attorney does.
The good news from a landlord point of view is that if your tenants spent their own money to alter the unit, then they must want to stay for awhile. Good luck!