Real estate investors make a common mistake with rental property. They generally make no provision to periodically inspect the units their tenants occupy. And this can lead to some surprising (if not negative) results for the landlord.

Several years ago I had a small twelve-unit apartment complex in escrow subject to a buyer’s walk-thru. The owner kept his units in good condition, plus the units were 100% occupied, so we both the owner and myself anticipated smooth sailing for the buyer inspection and felt that if there was going to be a problem with the property it might occur in a subsequent pest and dry rot inspection. We were wrong. During our walk thru several units were not only filty, one tenant in particular had a stack of tires in the living room piled to the ceiling alongside a massive teepee. Obviously this didn’t set well with Mr. & Mrs. Buyer because they backed out of the deal right afterward without further discussion.

What happened? The owner was lulled to sleep by the fact that his tenants paid their rent on time and were not disruptive and felt no need to periodically inspect the units. But given the age we live in, where drugs and other more deviant behavior is becoming more frequent, an investor must become more guarded and should periodically check in on the tenants just to be sure that things are as binane behind closed doors as they appear on the surface. The remedy? Rental property owners need to a schedule a walk thru of their units maybe twice, but no less than once a year. It might not prevent everything, but it will help.

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