As a rental property owner, your first concern should be protecting your property.
There's no denying that rental properties experience a lot of wear and tear. Whether you've got a single-family home or an apartment block, you need to ensure that your property doesn't degrade over time. Some of this comes down to regular maintenance, but you also have to hold your tenants accountable.
Certain things don't fall under the purview of "wear and tear". If your tenant does something to damage your property, you shouldn't be the one paying, which is what security deposits are for.
Today, we'll give you a quick guide on collecting security deposits for your Miami rental property. Read on and you'll see how a security deposit can provide you with peace of mind and preserve your rental units.
What Is a Security Deposit?
A security deposit is a fee you collect from a new tenant as they're starting their tenancy. For landlords, it's a safety net that protects you in the event your tenant purposely or inadvertently damages your property.
When the tenant moves out, you'll inspect the property together and make note of any damage that wasn't there during the initial inspection. If there's no damage, the security deposit is returned. If there is damage, you keep some or all of the security deposit to cover the cost of repairs.
In Miami, you can charge no more than the equivalent of two months' rent, but most landlords will do a single month's rent.
The Right Way to Collect Security Deposits
You shouldn't collect a security deposit without conducting a move-in inspection. During this process, you'll walk through the unit and make a note of any existing damage before their tenancy starts.
It's essential to document everything so there are minimal discrepancies should you have to withhold the security deposit later on. You should collect the security deposit separately from the rental payment before the tenant moves in.
Keep it in a separate account so your finances don't get mixed up. You should allow your tenant to pay the security deposit in whatever method works best for them. Most tenants prefer online payments nowadays.
Returning Security Deposits
When a tenant moves out, you'll do the exact same walkthrough of the unit, this time to look for any new damage. If there's nothing that appears more severe than normal wear and tear, you'll return the security deposit in full. You're required to do this within 30 days after the tenancy ends.
In the event that you do find new damage, you'll need to withhold some or all of the security deposit. When fixing the damage, you'll need to keep the receipts so you know how much to withhold. You can also withhold a security deposit for unpaid rent if the tenant terminates the lease early.
How a Miami Property Management Company Can Help
Collecting security deposits is just one of many responsibilities you'll have as a landlord. If you ever have to withhold a security deposit, there's a good chance you'll be dealing with an angry ex-tenant. In these circumstances, it becomes abundantly clear how helpful a property manager is.
When you want to experience the benefits of rental property ownership without any of the headaches, hiring a property manager is a great move. At Pristine Property Management, we're among Miami's top full-service property management companies.
We can help you deal with security deposits, rent collection, and property maintenance, among other things. Contact us today to learn how we can help you run your rental more effectively.