An issue that many landlords face in rental management is the problem of restoring the property to its original condition when tenants move out. Many of these problems stem from a lack of confirmation at the time of moving in. In order to achieve stable rental management, "pre-tenant checks" are extremely important.
In this article, based on our many years of property management experience, we explain why pre-tenant checks are important and specific practices from an expert's perspective. Through this article, you will learn concrete methods to prevent restoration problems and build good relationships with tenants while strengthening risk management in rental management.
Why "pre-tenant checks" are the most important management issue
Pre-occupancy checks are not a formal procedure, but a rational "investment" to protect the property and rights of both landlord and tenant and to prevent future risks. Its strategic significance can be summarized in the following three main points
1. to objectively determine the extent of restoration obligations
By documenting the condition of the property at the time of occupancy with dated photographs and checklists, it is possible to clearly determine whether the damage at the time of vacating was caused by "tenant's intentional or negligent acts" or by "age-related deterioration or normal wear and tear. This is in line with the purpose of the "Troubles and Guidelines Concerning Restoration to the Original Condition" published by the Ministry of Land, Infrastructure, Transport and Tourism, and is a strong basis for judgment in the event of a dispute. 2.
(2) Build a relationship of trust with the tenant
The "pre-occupancy check," in which the condition of the property is checked before occupancy, is an excellent opportunity for the landlord to demonstrate its fair and transparent management stance. This leads to long-term occupancy and fewer problems. This directly leads to a reduction in vacancy risk and contributes to stable cash flow.
3. contribute to the maintenance and improvement of asset value
Pre-occupancy checks are also an opportunity to gain a detailed understanding of the property's condition. This enables early detection and repair of minor defects, which can be addressed before major renovations become necessary. It is also an important part of maintenance activities to extend the life of the building and maintain asset value over the long term.
Trouble Incidence Rate vs. Management Impact
It is clear at a glance how the degree of thoroughness of pre-tenant checks directly affects the stability of management.
| Item | Properties with thorough pre-tenant checks | Properties with inadequate pre-tenant checks |
|---|---|---|
| Major Troubles | Amicable discussions on minor expenses Agreement on actual expenses for missing equipment, etc. |
Disputes over refund of security deposits (e.g., by content-certified mail) Refusal to pay for expensive repairs Dispute over return of security deposit (content-certified mail, etc.) ・Development into small claims court |
| Average time to resolution | Within 1 week | More than 1 month (more than 6 months in case of lawsuits) |
| Impact on management | Quick transition to the next tenant search Maintain stable cash flow |
Opportunity loss (significant delay in recruiting new tenants for the next period) Unexpected expenses such as legal fees Damage to brand image and emotional stress |
As this chart shows, sparing a small investment before moving in can result in immeasurable time and financial costs in the future.
The Professional's Pre-Tenant Checklist and Perfect Procedure
The key to an effective pre-tenant checklist is comprehensiveness andobjectivity. A well-designed "Checklist of Current Conditions of Rental Property" is the key to ensuring both. Below is a detailed explanation of the items on our recommended checklist and the points to check for each.
The Ultimate Pre-Occupancy Checklist
| Category | Check Item | Points to be checked (both the landlord and tenant should point and check) |
|---|---|---|
| Entrance | Door, key, intercom, shoe box, floor | Smoothness of locking/unlocking, number of keys The visibility of the door scope and the operation of the door closer. Video and sound from the intercom with TV monitor Missing or rickety shelves in shoe boxes Cracks in the tiles of the floorboards |
| Living Rooms and Living Rooms | Wallpaper, flooring, ceilings, windows/sashes, storage | Existence of stud holes in walls, existing repairs, tanning Scratches, dents, and creaks in flooring Wane and stains on tatami mats Scratches on window panes, sash openings, screen door tears Closet hanger pipes, door operation |
| Kitchen | Stove/heater, exhaust fan, sink, faucet, storage | Ignition and heat power of all appliances, operation of safety devices Sucking power of exhaust fan, unusual noises, lighting Scratches and rust on sinks, drainage conditions, drain odors Leaking faucets, hot water temperature stability Distortion of storage door, stains and mold inside |
| Bathrooms and washrooms | Faucet, shower, mirror, ventilation fan/dryer, bathtub, water heater, washbasin | Water pressure in showers, clogged heads, leaking hoses Scratches and scales on mirrors, anti-fog function Noise from exhaust fan, operation of dryer/heater function Cracks and scratches on bathtubs, reheating function Response of water heater remote control Scratches on washbasin bowl, water leakage from plumbing in storage |
| Toilet | Toilet bowls, hot-water washing toilet seats, ventilation fans, holders, etc. | Water leakage in the tank, amount of water used for flushing Nozzle operation of hot-water washing toilet seat, temperature control function Operation of ventilation fan, timer function Operation of ventilation fan, timer function |
| Balcony | Flooring, handrails, clothesline catch basins, escape ladders | Peeling or cracking of waterproof paint Wobble and rust of handrails Damage and deterioration of clothesline catch Check the opening and closing of escape ladder hatches. |
| Other facilities | Air conditioning, lighting, electrical outlets, curtain rails | Check the operation of air conditioners (10 minutes operation), unusual noise/odor, and filter condition. Check the lighting of all lights and operation of remote controls. Check all electrical outlets for continuity. Check the condition of curtain rails and the number of runners. |
Summary: The best management decision of "prevention" to protect future earnings
In this article, we have explained the strategic importance of pre-tenant checks in rental management, with specific techniques.
Finally, we reiterate the main points.
Understanding the Legal and Managerial Significance
Pre-occupancy checks are a management decision to comply with MLIT guidelines and reduce future dispute costs.
Attention to quality of evidence
Dated photographs (of known size) and a detailed checklist, signed and sealed, are powerful weapons in the event of an emergency.
Proactive Risk Management
Instead of dealing with problems after they occur, we are moving toward "proactive management" to prevent problems before they occur. Pre-occupancy checks are an action that symbolizes this shift.
Trouble over restoration to the original condition, once it gets out of hand, can be very costly. However, most of the risks can be controlled through appropriate "prevention," i.e., careful and sincere checks before moving in. We hope that the methods described in this paper will help you to stabilize and increase the profitability of your rental business.
Frequently Asked Questions (FAQ)
Q1: Can I use a commercially available checklist?
A1. Although commercially available templates are helpful, the first step to professional management is to create and operate a "list optimized for your property" by adding or deleting items according to the characteristics of the property (e.g., designer, pet-friendly, etc.).
Q2. Should all existing scratches and stains be repaired perfectly?
A2. You are obligated to completely repair any major defects that affect safety or function. On the other hand, it is important to clearly identify and record the existence of minor scratches and stains in a "pre-occupancy check". This objectively proves that it is not the responsibility of the current occupant and avoids unnecessary disputes.
Q3. How long does it take to check?
A3. Although it depends on the size of the property, 45 minutes to 1 hour for a unit for a single person and 1 hour to 1.5 hours for a family unit will allow for a careful and thorough check without rushing. Remember, sparing time can lead to an "expensive bill" of future problems.
At our Oyaokai (INA Network), we share a wide range of information and learn together with our members, from practical know-how on rental management as mentioned in this article, to trends in legal revisions and the latest technology utilization cases. If you join the Oyaokai, I will be happy to answer your specific issues and questions with all my experience and sincerity, provided that you abide by the rules of the association. If you are interested, please do not hesitate to contact me. Together, let's walk the path of successful rental management.
Daisuke Inazawa
Representative Director of INA&Associates Inc. Based in Osaka, Tokyo, and Kanagawa, he is engaged in real estate sales, leasing, and management. He provides services based on his extensive experience in the real estate industry. Based on the philosophy that “human resources are a company's most important asset,” he places great importance on human resource development. He continues to take on the challenge of creating sustainable corporate value.
.png)
