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4 Common Legal Mistakes to Avoid When Managing Rental Properties in Austin, Texas

4 Common Legal Mistakes to Avoid When Managing Rental Properties in Austin, Texas

The average rent in Austin, Texas, is $1,816 per month. Owning and managing rental properties could provide a lucrative source of income for real estate owners. However, this investment requires careful management to avoid potential legal issues.

Going through litigation and appearing in court is expensive. It can quickly negate any potential profit from rental real estate investment. Avoid these four common legal mistakes when managing your rental properties.

1. Discriminatory Tenant Screening

All landlords must know, understand, and follow the Fair Housing Act. This federal law protects people from discriminatory treatment. The tenant screening process is when many landlords knowingly or unknowingly violate this law.

Avoid questions that could be viewed as discriminatory because they are based on these factors.

  • Race
  • Religion
  • National origin
  • Gender identity
  • Sexual orientation
  • Familial status

Working with a reputable property management company can help you avoid discriminatory tenant screening actions. Look for a service that provides a thorough and fair screening process.

2. Using Template Legal Forms

Templated legal documents and forms are readily available online. However, they can set landlords up for legal problems. For example, you could download a template lease agreement.

You must ensure that it is a lease agreement meant for use in Texas. It would also need to be up to date with the latest laws. The law continuously evolves, with 774 new state laws going into effect on September 1, 2023.

If your lease agreement is old, it could have no longer enforceable terms. Or worse, it could have terms that violate the law.

Finally, templates have many terms that cover a broad range of situations. This means you could include terms you don't want to agree to. You could also have a lease agreement that's missing situation-specific terms.

3. Failing to Make Repairs

Landlords must follow Texas laws that outline the repairs a landlord must make. These are repairs that ensure the habitability of the property.

A good general rule is that you probably need to make repairs if the problem violates building, fire, or health codes. Examples of problems impacting health and safety standards include roof leaks, electrical issues, plumbing backups, or broken air conditioning.

4. Keeping Security Deposits

Many landlords require a deposit at the commencement of a lease term with a new tenant. Asking for one isn't a problem. Keeping it without reason is a violation of the rental deposit law.

For a landlord to not run afoul of security deposit laws, they must do a few things. First, provide a detailed and itemized list of deductions. Then, timely return the remaining security deposit money after the expired lease ends.

Get Help Managing Your Rental Properties

Being a landlord in Austin, TX, can provide a valuable source of income. However, managing rental properties requires you to learn about landlord-tenant law. Otherwise, you risk your investment becoming a significant expense.

Working with an experienced property manager can provide valuable guidance. With their knowledge of applicable law, you can avoid these common pitfalls.

Contact our team of experienced rental property managers for help managing your rental properties.