Arkansas is currently one of the friendliest states in the Union for residential landlords. This has made our state one of the best in the country to invest in residential real estate and has produced a large industry of real estate investors and house-flippers.
However, because of the strong trend nationally granting tenants more rights in their dealings with residential landlords, it’s important for owners of residential rentals to stay abreast of the changes that are likely coming to Arkansas.
The biggest legal change likely to come to Arkansas is something called the “implied warranty of habitability.” It is part of the law in all other forty-nine states that there is an implied term in every residential lease that the landlord agrees to keep the premises fit for human habitation.
While you think that might be a very low bar to overcome as a landlord, there’s more to the concept than you’d think on first glance. To determine what “fit for human habitation” means, most states imply local building codes into residential leases. Take one second and read that last sentence again. What that means is that every residential lease in a state with an implied warranty of habitability contains (without it having to actually be printed in the lease agreement) the entirety of the local building code. Your contractual obligations under the lease just got a lot bigger without you knowing about it.
Historically, Arkansas hasn’t had an implied warranty of habitability, and so the only terms of residential leases have been the explicit contents of those leases. Last year, a Pulaski County circuit judge entered an Order finding that the City of Little Rock Housing Code was implied into residential leasing agreement for a particular apartment complex in Little Rock. While the Court did not read a general implied warranty of habitability into residential leases, it did find that the housing code became part of all residential lease agreements.
This indicates something of a sea change is coming in landlord-tenant law in Arkansas. The housing code requires a great number of things you may not have expected. For instance, under the housing code, landlords are “responsible for the extermination of all insects, rodents or other pests.” Sec. 8-402. That means every landlord in Pulaski county is currently required to pay for pest control. Are you doing that at every one of your rental properties? Also, every room has to have a window facing directly to the outdoors. Sec. 8-404(a). Every room must have two floor or wall electric outlets. Sec. 8-404(d).
The point is that there are great number of things in your residential lease you may not have known about.
Wilson & Haubert, PLLC, is in the beginning stages of offering a legal subscription service to residential property owners in Arkansas. In addition to keeping you abreast of the law, we plan to offer services including contract review, LLC formation, unlawful detainers, and other legal issues which might arise from residential rental property ownership. The cost of these services will be a monthly fee of a few hundred dollars. For folks who have a lot of property and have a consistent need for legal services, this could produce huge benefits and peace of mind. In short, if you have a legal problem concerning your residential rentals, we’ll fix it if you subscribe to the service.
We feel that this is a unique service not offered by anyone else in Arkansas, and we’re looking for interested property owners and managers who are in need of consistent legal services for a low monthly fee. If you could use such a service, give us a call, and we’ll assess your needs today.