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How to be an Ethical Landlord: Seven Important Tips

September 01, 2022

Is there such a thing as an ethical landlord? You wouldn’t think so by reading the stories online. Landlords have gotten a bad rap over the years, due to the many horror stories of bad ones. They force the renter to sign a misleading contract, might refuse to make essential home repairs or even snoop around in tenants’ apartments when they’re not home.1 But it’s not difficult to manage a rental property and be a good owner by following some basic landlord ethics. It’s a matter of responsibility, respect and maintaining a professional relationship with your tenants so that they feel safe and comfortable.2

Keep reading for important tips on how to be an ethical landlord.

Landlord Ethics—Seven Useful Tips

Is being a landlord ethical? As a property owner collecting rent, you’re running a lucrative business, but you’re also providing an important service. Many people can’t afford their own home. A study by home improvement website Porch.com found that 61% of U.S. renters couldn’t afford to buy property in their hometown.3 Other reasons to rent and not buy include a prohibitive down payment, maintenance and repair bills, property taxes and the responsibility of upkeep. Renters may have access to certain amenities that can save them money, and they might enjoy greater freedom if they’re planning a future move.4

Here are some ways that you can be an ethical landlord.

1. Create a Straightforward, Detailed Rental Agreement

Presenting an easy-to-understand and highly detailed contract for tenants will answer questions they might have and prevent confusion. You should clearly outline all terms and conditions of rental, explaining what is expected of them as tenants, as well your responsibilities as the landlord. Be sure to include your current contact information, so that your tenants can reach you with any problems. Use language that is as simple and concise as possible.2

Keep your rental agreements organized in case there are any disputes. Record every action you take, including all necessary invoices and maintenance performed.5

2. Set a Fair Rental Price and Have Flexible Policies

Renters may ask themselves why landlords are so greedy, but It’s challenging to decide on proper rents. An ethical landlord must consider the current market as well as ownership expenses, which are sometimes difficult to predict. Ultimately, you must be able to cover your expenses with a reasonable profit, but if you set the rent too high, it will be harder to find tenants.

Is raising rent ethical? Rising costs of property taxes, maintenance, repairs and utilities (if they’re included in the monthly rent) may require a rent increase, and it is the landlord’s right to enact one. If you need to raise the rent, that’s a standard industry practice, but try to increase it in annual increments rather than all at once. Rent hikes of one to five percent are the norm, and you should give your occupants 60 days’ notice before you raise it.5,2

You’ll need to have firm rules in the lease, but life can be unpredictable. What if you have an excellent tenant who was unexpectedly laid off from work, and they have notified you that their rent will be late? Depending on your state and the situation, you might be able to immediately evict them, but an ethical landlord would first consider the options. Some of these include extending a grace period, cash for keys (paying them to leave) or accepting partial payment.5,6

3. Be Responsive and Accessible

When your tenants contact you with an issue, respond to them promptly and address the problem as soon as possible. It may be a pipe leak, a weather emergency or unruly neighbors, but they should have your contact information and feel confident that you’ll do what you need to do to keep them safe and comfortable. If you’re unable to handle things yourself, consider hiring a property manager.5

4. Handle Maintenance Requests and Repairs Quickly and Efficiently

If you aren’t doing maintenance jobs and repairs yourself, it’s helpful to have a network of skilled contractors who can fix a wide range of issues. You’ll need to vet any plumbers, electricians, yard maintenance staff and other contractors to ensure that they are trustworthy and reliable. Keep in mind that your tenant’s life is adversely affected whenever there’s a problem or maintenance is overdue. Having a healthy living environment is your tenant’s legal right.5

5. Practice Compassion—It’s Good Business

With the proliferation of online review sites, showing kindness and compassion is not just a matter of good landlord ethics—it’s smart marketing. A bad interaction with a tenant could generate a critical online review, deterring future tenants, while positive interactions may bring in more business. By being professional and demonstrating empathy, you create the right boundary between you and your renters.5

6. Respect Tenants’ Privacy

You may have the right, according to your local laws, to enter an apartment to perform inspections or repairs. However, good landlord ethics state that you should not do this excessively or without letting your tenants know of your arrival beforehand. Give 24-hour advance notice and schedule any visit so that it’s convenient for your tenants. If they’re not going to be there, obtain their permission to enter their space.5,2

In addition to respecting tenants’ physical privacy, you should also keep their sensitive personal data strictly confidential. Your rental agreement may include the renter's date of birth and social security number. Misplacing or misusing this information violates their privacy, so keep it stored safely.5

7. Comply With Fair Housing Laws and Local/Federal Regulations

As a landlord, you have certain legal obligations beyond being an ethical landlord because it’s the right thing to do. For example, the Federal Fair Housing Act (FHA) ensures that landlords treat tenants fairly. This law prohibits housing discrimination due to race, color, religion, national origin, sex, disability and familial status.7 If you do not comply with this law, you could receive a discrimination complaint, which could lead to significant fines.5,8

Depending on your location, there may be state statutes to consider. Research and become familiar with your state’s statutes for legal issues such as discrimination, rental agreements, repairs and maintenance, privacy and right of entry, environmental hazards and eviction.9

These state and federal laws constitute a ‘duty of care’ that landlords have to their tenants. Duty of care is a legal and ethical obligation that requires people to make decisions prudently, with caution and in good faith. Failure to do so may result in legal action.10

Benefits of Being an Ethical Landlord

It’s in your best interest to be an ethical landlord. While it requires regular communication, attentiveness, and strong leadership skills to act in a compassionate and professional manner, these efforts produce great benefits. With responsibilities and expectations clearly laid out, and responsive, respectful behavior on your part, property management will be much easier.2

As an ethical landlord, you’ll have a stronger relationship with your tenants, and this will lead to long-term occupancy. Satisfied tenants who are comfortable and who feel at home will likely take better care of the place. Keeping standards high, furthermore, will keep you free from potential legal action. Happy renters are also likely to recommend you to others.5

Landlord ethics are just one element of the highly complex yet extremely rewarding and potentially lucrative field of real estate. To excel in a real estate career, you need the multidisciplinary training and expertise that will help you stand out from the competition.

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