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City Inspections When Tenant Changes

Cities want to require new property inspections every time you change tenants in your rental property. To my knowledge, only Alexander City, Anniston and Gadsden have passed such laws, but others are trying, including Huntsville. The first inspection each time is either free or with a very low cost, but re-inspections after failure can get expensive. Usually the landlord can hire its own certified home inspector for the task. That might make sense if there are long delays before city personnel can make site visits.

What if you just ignore the law? How will the city find out? As always, someone could tattle. Then you’ll be in hot water, with huge fines and perhaps criminal prosecution. The other way is with the cooperation of utility companies, who will not turn on service in a new name unless they receive a copy of the Certificate of Occupancy issued after the landlord has passed inspection.

How do you fight this to keep your city from passing such laws?

  • They are directed at bad landlords with terrible premises and no responsiveness to tenant complaints. If you know of such conditions, report them to local inspections departments. That way, they don’t have to rely on inspecting EVERYBODY just to find the bad landlords. Self-policing is always the preferred method for avoiding government intrusion.
  • Be vigilant! When similar ordinances are before local government for public discussion, appear at the hearings with as many other landlords as possible. Explain that the increased cost of the inspections and the non-rentable downtime before issuance of a new CO will result in dramatically higher rental rates. Housing will be extremely difficult or impossible for the most vulnerable members of the community, increasing the burden on public assistance programs and increasing the risk of homelessness. Local government needs to hear that more than just the “rich landlords” will feel pain if the law is passed.
  • As an alternative, propose your own law that rewards good landlords and keeps the pressure on the bad actors. We currently have a task force working on model ordinances, if that seems the only choice remaining.

Interested in more information about landlord/tenant law? Check into one of the 6-hour “Landlord Tenant Law” classes and videos, or the 3-hour “Landlord Law FAQ” classes and video on the Resources page, HERE. Coming to a city near you!

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City Inspections

Several months ago, somebody wrote to us about a new local law that required city inspections each time a residential rental property changed to a new tenant. Gadsden passed such a law in 2007. THIS IS COMING to other municipalities around the state. You might delay things, but you are not going to stop it. The best strategy is to manage it, so the result will protect tenants while at the same time not placing an undue burden on the good landlords who try to keep their properties in habitable condition.

The Gadsden ordinance requires current building code compliance. In other words, nothing is grandfathered in. When a rental becomes vacant, it must be inspected for code compliance. The cost is $50 for the initial inspection and one follow-up. Additional follow-ups cost more. Landlords may opt to use a licensed home inspector instead of a city inspector, which might be faster, albeit more expensive. If the dwelling passes, it will receive a certificate of occupancy. It is illegal to rent a “rental housing unit”that does not have a certificate of occupancy.

Scary language in paragraph (e) of the Gadsden law refers to “annual inspections” and says that if a property fails an annual inspection, the tenant will have to be relocated until the problems are fixed. There is no language requiring annual inspections, so I am not sure what is going on there.

We are working on drafting a model ordinance that will meet city concerns for tenant health and safety while also addressing landlord concerns about slow inspections and unreasonable demands by inspectors. When word reaches us that a city is planning an ordinance like the one in Gadsden, we can present them with a model law to copy. That way we increase the odds that we won’t get stuck with some poorly worded and onerous ordinances. Anyone who has any comments or suggestions should indicate them below, or send a private email on the “Contact” page.

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Section 8 Ineligible

Alabama low income housing boards have been changing their policies, and will no longer accept properties for Section 8 housing if there are outstanding redemption rights. That means lender-foreclosed properties must wait out the six to twelve months of redemption, depending on whether it was homestead exempt or not.

Tax sale properties will need a quiet title order to be sure that all redemption rights have expired.

A faster solution is to get a quitclaim deed from the former owner (or heirs) or a release of their redemption rights.

The reasoning is that the Housing Authority does not want to put a family into a Section 8 home, and then have them disrupted later when they have to move because of redemption. Yes, I know redemptions rarely occur with lender foreclosures, but the risk is still there.  In addition to the cost and disruption of the actual move, replacement housing might not be available in the same area, or at all.