State and local laws regulate the physical condition of residential rental property. These laws apply when a tenant moves into the unit, and for the length of their tenancy. Since residential rental property must be habitable, state law and local building codes set forth minimum requirements for necessary services like heat, water, and ventilation. Court decisions also set the standard for habitability, ensuring that tenants occupy livable space.
Implied Warranty of Habitability
An “implied warranty of habitability” exists in residential rental agreements in almost all states. This warranty ensures that the premises are comfortable, safe, and fit for human occupation throughout the tenancy. The premises must be structurally safe, and the rental unit must be clean and sanitary with available heat, water, and electricity.
Since the warranty is “implied” by law, tenants have different sources for enforcing the habitability warranty. Many states have enacted landlord-tenant laws setting forth the landlord’s duty to repair and maintain the rental unit. Local codes tend to be more detailed, with requirements for light, ventilation, and electric wiring. In some states, a landlord’s compliance with state and local housing codes satisfies the habitability requirement.
In certain states, the warranty of habitability is defined on a case-by-case basis, meaning that the warranty exists independent of state and local statutes. California, for example, requires that the premises be “fit and habitable” for occupation, and this term is interpreted through legal cases. The result is that sometimes the courts hold landlords to a higher standard than the housing code, requiring more than is set forth in the statute.
Tenants also have a responsibility to maintain the rental unit. It must be clean and sanitary throughout the tenancy. A landlord may not be expected to pay the cost of repairs to the unit caused by the tenant’s negligence or failure to satisfy their duties.
Delegating Repairs to Tenants
In general, it is in your best interest as a landlord to keep your rental property in good, clean, and safe condition, and respond promptly to your tenants’ requests for repairs. In many states tenants may do repairs themselves and deduct the cost from their rent, but for a number of reasons it can be unwise to allow this. First of all, if the repair at issue is a major one, you should take care of it and not attempt to delegate it to a tenant, who may do a less than professional job and cause significant damage to the property or risk of injury to other tenants. Even if the repair job is minor, there is still a chance that poor quality work may lead to costly repairs or even liability for tenant injury for you. The tenant’s repairs also may not be up to applicable codes, which are your responsibility to comply with, and some state laws place responsibility for specific types of repairs and maintenance on landlords. If you do choose to delegate repairs to tenants in exchange for a rent reduction, which would only apply if the tenant did not cause the damage and the repairs are not purely cosmetic, check to make sure the work is being done properly, and remember that you are always ultimately responsible for keeping your property in habitable condition.
Repair and Deduct
In a similar vein, in states with laws on the books permitting this, tenants can make repairs and deduct the costs from their rent if you have failed to make them in a timely manner. While a few states allow tenants to repair and deduct for small issues, in most states with these laws the repairs must be connected to major services. Additionally, the tenant cannot have caused the damage, and they must have notified you and given you a fair amount of time to address the repairs. Finally, the amount the tenant spends on the repair and later deducts must be reasonable, and in many states there is a limit to how many times this remedy may be invoked during a specific time period. Similar to situations involving a willful delegation of repair work by landlords to tenants, it is generally best to address the repairs promptly and to handle them yourself so as to avoid not only future legal scuffles with your tenant, but also to avoid further costs and possible damages if the repair work is poorly done or injures someone.
In general, if a tenant installs something in your rental, like a bookshelf or anything else that is attached to the property, it will become yours at the end of the tenancy. If you and the tenant disagree about this, factors a court may look at in deciding who should keep the item include whether the tenant had your permission to install it, whether the changes altered the look or structure of your property such that removing it will require you to make costly repairs, and how easily the item can be removed. What you and the tenant intended could also be relevant. In the end, it is also worth asking yourself if you have any use for the object, and whether it would really be too burdensome to make repairs after the tenant removes it before taking a dispute about a fixture to court.
In many states and cities, tenants have a legal right to withhold rent if they feel a major or minor repair issue is not being adequately addressed by their landlord. However, this is generally only allowed in situations involving major repair or habitability issues that were not caused by the tenant, and that you have had notice of and a reasonable opportunity to fix. Further, in some states, tenants seeking to withhold rent must escrow their rent with a court or housing authority while awaiting the repairs at issue, and you may be able to access some of that money for the repairs. Once the repairs are done, the tenant might still request that you compensate them for the months they believe they lived in substandard housing.
When Premises are Uninhabitable
If a landlord refuses to meet minimum requirements for habitability, tenants have several options, depending on the severity of the problem. If a tenant has provided you with written notice of the issue, in many states you will have somewhere between one and three weeks to fix it. If you fail to do so, the tenant may report you to the local housing authorities, bring a lawsuit, or move out.
If the problem creates a serious habitability issue, such as a lack of heat in winter or no running water, a tenant can either move out temporarily while the problem is being fixed and make you responsible for the reasonable costs of their replacement housing, or break the lease and move out permanently. In cases involving the latter option, the tenant may hold you legally responsible not only for their costs of moving and the difference in rent they are paying to live in a comparable unit, but also for the difference between the rent they paid you and the actual value of the units during the months that it was in substandard condition. Note that if the habitability issues were created by the tenant, a third party, or a natural disaster, you are not likely to be held financially responsible for things like relocation assistance. However, if your own negligent acts contributed to the unlivable condition of the rental, it is unlikely that your insurance will cover the costs you are responsible for.