When people find out I'm a landlord, they sometimes ask whether I'm a slumlord. Although I know they're just trying to be funny, I usually take offense. Landlords provide a legitimate, sought-after real estate service. Yes, landlords, like all businesspeople, are in business to make money. But like all successful business people, successful landlords have a reputation to protect and seek to provide a good product to the marketplace.
Slumlords, on the other hand, don't care about their reputation or take care of the properties they own (which are usually in bad neighborhoods), often preying on people who typically have no other options.
Yes, there is a huge difference between a landlord and a slumlord. Find out which one you are.
Definition of 'slumlord'
A legal definition of a slumlord is an "unscrupulous landlord who milks a property without concern for tenants, neighborhoods, or their own long-term interests." Slumlords do not bother to repair or maintain their properties, often skirting the law because of the terrible condition of their rental units, all the while taking advantage of poor people with few options.
Rights tenants have
Tenants don't have to put up with subpar conditions from slumlords. They are protected under federal law under the warranty of habitability. This means landlords must provide a safe, habitable dwelling for their tenants. This is something slumlords don't do.
Responsibilities of a landlord
To meet the warranty of habitability, landlords must provide a safe dwelling. To meet this standard, landlords should provide the following:
- Hot water.
- Drinking water.
- Smoke detectors.
- Doors that lock.
- A property free from pests and critters.
- A property that meets local building codes.
If your renter is in one of your properties and it doesn't meet all those standards, your tenants might contact their local housing authority or HUD.gov for help. If that happens, you could be in trouble: You might be sued or ordered by code enforcement to fix your rental unit. If you don't, the city might condemn it.
So, are you a slumlord?
If your rental property displays any of the following defects, unless you fix them, either by providing your own property maintenance or by hiring a property management company, you could be a slumlord:
- Structurally unsound: A sagging porch, a roof with holes, or siding that's warped or missing in spots.
- Overcrowding: Too many people living in a space.
- Illegal dwelling: An unapproved outbuilding, garage, or basement.
- No basic services: No heat or running water.
- Unsafe conditions: Exposed wiring, broken windows, or doors that don't lock.
- Unsanitary conditions: Pest infestation, uncollected garbage, or mold.
Most times, the city is responsible for keeping slumlords in check. The city will usually fine landlords until they get their property in shape. If there are no improvements within a specific time frame, the city might then condemn the property, deeming it unfit to inhabit.
Once a building is condemned, its residents must move out. They can return only if the necessary renovations are made. At that point, many slumlords choose to sell to developers rather than make the necessary repairs.
Legal trouble and a bad reputation
If you're a slumlord, you could be facing a lawsuit from an angry tenant one day. Many tenants often get legal help through their local legal aid organization.
If you lose, these are the possibilities:
- Your tenant could be allowed to break the lease.
- Your tenant could be allowed to withhold rent.
- You might be ordered to compensate a tenant if they were a victim of crime.
- You might be ordered to compensate a tenant for pain and suffering if there was a health issue related to property conditions.
Besides losing out monetarily on rental income, your reputation could be damaged. People have always talked when they get bad service, and with social media, it's even easier for disgruntled tenants to ruin your reputation. Or, if the city gets involved, you might find yourself on the local news -- and not for anything good.
True slumlords probably don't care about their reputation. But if you're not a slumlord and have just been neglectful and now want to do the right thing, you can change the way you do business by making sure your properties meet basic standards moving forward. By providing a safe, decent place for people to live, you're providing a much-needed service that's in demand in many locales.
The bottom line
Unfortunately, slumlords do exist, and they give all landlords a bad name. If you're a slumlord, you might wish to seek legal advice. There is a big difference between a landlord and a slumlord.
If you strive to be a landlord by doing business in an honest, reputable manner, by treating your tenants fairly, and by maintaining your properties, you should have a profitable landlord business -- and be able to sleep at night.