tenant wanting security deposit back Help OhLanlord

Hello. Hopefully Ohlanlord or someone else here can help me figure this out. 5 months ago in California, I rented out a home to a a family. Prior to this the home was on the market but would not sell so in the meantime I put in brand new carpets and fixed all the little things necessary to, in the case i needed to rent this home due to real estate inactivity, would, keep in mind the home was vacant until the tenants' move in. The tenants moved in to the home for 1200/mo with a 1200 refundable (pending deductions) sec. deposit and an additional 300 dollar pet deposit totaling 2700.00 as their move in costs. I have an iron-clad rental agreement, had taken pictures of the the home before move-in (and I mean every room, corner,etc) and had a friend sign and vouch that the home was in excellent condition (no leaks, brand new carpet, paint, and landscaping), Fast forward to today and the tenants have moved out and stated before inspection, that the property is in better condition than when it was given to them. I did an inspection with the tenant and found that there were questionably bigger holes in the walls due to a cable modem connection, a leak under the sink that they tried hiding by stacking bricks to hold a pipe in place, another leak from a pipe that supplies a fridge they purchased with an ice maker. The new carpet I installed downstairs needs to be replaced (upstairs would be fine with a few rounds of a steam cleaner which I plan to do) a couple of mirrors in the bath and bedroom are broken, the front door is broken and trash with paint surrounds the outer areas of the home. In my contract there is a 100.00 cleaning fee that I plan to deduct and have estimates totaling 1200.00 to cover the rests. The only thing I think they should get back is thier pet deposit. When I spoke to the tenant over the phone there were obviously some exchanges. should I worry if I am taken to court?

[OHlandlord]

You need to do an itemized statement with reciepts and get it back to them within 3 weeks of their departure per CA law. All of these damages were done in 5 months? You have the reciept from where new carpet was installed into the unit prior to their move in? Use the pet deposit to replace the carpet (but first get a signed statement from a carpet professional or cleaner to say that the carpet is damaged beyond cleaning). Prorate the price of the new carpet. If you bought it 6 months ago, deduct about 10% of the new carpet cost for depreciation (6 months out of 60 months = 10%) if you used a 5 year depreciation schedule. (Let me know the length of time you are using on your tax form to depreciate the carpet for a rental expense and how long ago you purchased it and I will work out the exact number for you.)

Holes in the walls, plumbing leaks, and broken mirrors are all damages and you can charge the whole cost of the repairs from the deduction. Have the door repaired (better to repair than replace for tax purposes) and charge for this also. What exactly do you mean by "trash with paint surrounds the outer areas of the home"? If it is trash in the yard, don't charge since you are already charging a cleaning fee.

Remember that you have to send receipts with the statement so get busy with the repairs. It has to be mailed out within 3 weeks. You have $1500 in total deposits. If there is anything left, send them a check with the statement. Did you offer a PMI before they left as per CA law?

That's the same thing I thought when you asked if all the damages were done within a 5 month time frame! When I spoke with the tenant to address these issues he magically had a better idea of his rights as a tenant in which he had no idea before, which is fine by me, I'm not out to get anyone but what's right is right, and in 5 months... I have all the prior reciepts from when everything was replaced prior to their move in. I tried to clean the carpets by myself and was successful at salvaging the upstairs portion. The downstairs part is really hard. I'll try to get a prof'l but if I don't should it make a considerable difference? I am deducting the cost of the replacement carpet at 10%. Will not charge them more than the 100.00 cleaning fee for the trash left outside and am trying to find corners to where, if I am taken to court, shows that I tried everything I could to save costs and give them their security deposit minus deductions back. Do these have to be reciepts or can they be estimates as well? Can you go further into the PMI?

Thanks OhLanlord

[OHlandlord]

If you can, get a carpet cleaner to just come by and give you his written opinion on whether the carpet can be saved. You could even make up a blank form for him to sign so he could just check off [ ]The carpet may be saved with a professional cleaning, or [ ]This carpet is beyond cleaning in my professional opinion, and a signature & date line. That will definitely hold up in court. If you can't, take lots & lots of pictures of the carpet, and save a 1' square piece of the worst area to show in court. In this case, charge them 90% of the cost of the replacement (and show the carpet was depreciated 10% because it was only 6 months old out of an expected life of 60 months). You may be able to charge them for carpet cleaning for the upstairs too, but check your state law. After only 5 months, it shouldn't need cleaned if it had been cared for normally.

CA state law has a requirement that you must offer the tenant a pre-move out inspection (PMI) a few weeks prior to the vacancy date. This is to give them an idea of what they can expect to be deducted (although it may not be a comprehensive list of deductions), and give them a chance to fix things. There is specific wording you must use for this offer of an inspection. They can refuse and turn down the inspection, but you must offer it. Did you offer this to them? Check your state law for the requirement. From what I understand, it is very important to do this.

As for estimates, I'm not sure if your state law allows this. OH does, but then we have to send a follow up when the items are actually completed. But we have weather problems here in some months that prohibit certain repairs from being made (you couldn't paint outside in early spring, you couldn't do some exterior repairs in winter, etc.) I suggest you call a local landlord's association or a local chapter of REIA and ask them for more information on the PMI and estimated repairs. These things apply only to your state.

Most importantly, get the statement to them on time.