Shapack & Shapack, P.A.
Shapack & Shapack, P.A.
Attorneys at Law


The Charlotte Observer

May 16, 2005

Talk to My Lawyer

Questions of Law


A Would-be Landlord Has a Lot to Learn

"Talk to My Lawyer" offers information about the law from area lawyers. We welcome reader questions. This week we tapped Claire K. Shapack of Shapack & Shapack, P.A., whose practice focuses on civil litigation, primarily commercial and residential landlord-tenant law and personal injury law.

Q: I'm going out of town on business for a while and an acquaintance wants to rent my town home while I'm gone. What do I need to know about landlord-tenant law? Should we have a written lease and if so, what provisions are most important to include? And are there tax consequences to me from this type of arrangement?

Nothing is more important than finding a responsible tenant. Do some background research on your acquaintance, using any of the following: references from prior landlords; verification of employment; criminal record check; credit report; and judgment and pending civil action searches.

North Carolina has detailed statutes governing the landlord-tenant relationship in residential property. For example, your home must meet all current applicable building and housing codes before you rent it. There is less regulation of commercial landlords and tenants.

The statutes cover many areas in the residential context including: certain rights, obligations and remedies which must be included in leases; a cap on security deposits and their permitted uses; a cap on late fees; the procedure for evicting tenants; and prohibitions against retaliatory evictions.

Leases are also known as rental agreements or contracts. Oral leases for three years or less are enforceable in North Carolina, but written leases are preferable. A careful writing can prevent misunderstandings and confusion.

Basic lease provisions will set the term (time period) of the tenancy; the amount of rent and the frequency of payment; the amounts of late fees and security deposit; who will pay utilities; whether pets are allowed; the landlord's obligation to put and keep the premises in fit and habitable condition; the tenant's responsibility to keep the premises in good and clean condition; and the rights of the landlord and tenant if the other breaches the lease.

As a landlord, you want the right to terminate the lease with or without notice if the tenant breaches any provision of the lease. It is advisable to have an attorney draft or review the lease before signing it.

The rent you receive may be taxable income to you. You should consult your tax advisor before renting to determine the tax consequences to you in this situation.

Reprinted with permission from The Charlotte Observer. Copyright owned by The Charlotte Observer.

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Shapack & Shapack, P.A.
301 South McDowell Street, Suite 802
Charlotte, North Carolina 28204
Phone: (704) 375-7500
Fax: (704) 342-1500