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When a Property Owner Wants to DIY: how real estate licensees and property managers can manage the risks

DIY (“do it yourself”) can be an attractive option for a seller or a landlord because it’s cheaper than engaging a professional. But, what about the impact if the repairs aren’t quite as professional as they should be? 

If something goes wrong and DIY works were completed by an unlicensed seller or landlord, lawsuits are likely to follow. And, it won’t just be the property owner who faces a claim — a lawsuit is also likely to be launched against the real estate licensee or property manager. 

Some repairs are better suited to a qualified contractor than a DIY property owner (and if permits are required, licensed professionals are usually required). Here are some tips to help real estate licensees and property managers avoid a lawsuit.

Repairs That Need Professional Help

When a property owner tells you they’d like to DIY and handle these things, and they don’t have the appropriate license, think twice:

Electrical Work

Electrical repairs, if not done correctly, can cause electrical fires. And any problems with the repair may not be immediately evident. Any repairs, replacements, or additions to a property’s electrical panel, wiring, or fixed electrical appliances are not DIY jobs. Installation of new outlets or other electrical work may also require a professional contractor to ensure the work is done to professional standards. In general, for most electrical work, it’s best to hire a licensed electrician.

Plumbing and Gas Work

Anything relating to gas needs to be done by someone with expert knowledge and experience. For example, any repairs or installations of new water heaters and other equipment need to be done correctly for safety reasons. 

Burst pipelines and leaks are also best fixed by a professional. A qualified plumbing contractor will be able to do the repairs faster and more efficiently. DIYs for these types of issues can result in further water damage and other problems.

Large Tree Removals

Removing large trees isn’t an easy job and should be done by a professional. There’s a risk that the tree could fall in the wrong direction causing property damage or injuries to people in the immediate area. Power lines add another layer of risk that can make this a dangerous task for an untrained property owner. A professional tree removal contractor has the skills and experience to handle the job safely. 

Demolition Work

DIY demolition can be hazardous to the DIY property owner as well as the occupants of the building. Some older properties may have asbestos, lead pipes, mold, or other hazardous materials. (Popcorn ceilings or old laminated flooring may contain asbestos; removal of those items require professionals. Mold remediation also requires licensed professionals.) Professional contractors and demolition experts know how to deal with this effectively and remove all the hazardous materials safely.  

Home Extensions and New Structures

Any home extensions and new structures, such as granny flats or garages, need to be permitted. This helps ensure the safety of the property’s occupants, as well as legal additions to a property. When a licensed builder is engaged to do the work, they will ensure that correct building permits are obtained. This means that potential buyers won’t encounter problems transferring the property  or face any legal action because of an illegal build. 

Balcony Repairs

If a multi-story property requires structural repairs to its balcony, this is best done by a qualified professional. 

HVAC Repairs and Installations

Using a professional for all HVAC repairs can help to maintain warranties and extend the life of an HVAC system. Quick DIY fixes might seem like a cheaper option, but they can lead to further damage that can turn into costly repairs for property owners in the future. 

How Can Real Estate Licensees and Property Managers Minimize Liability? 

Some property owners have ambitious expectations about what they can DIY to save costs. By being aware of the types of repairs that require a professional, real estate licensees and property managers are in a better position to help manage these expectations. 

As a real estate licensee dealing with a seller, of course the seller wants to minimize their costs of any repairs. But the seller also wants to avoid being sued because a repair wasn’t done to code, didn’t fix the problem, or caused further damage or injury to the occupants. Advise the seller in writing of your recommendation for a licensed contractor, and be sure NOT to recommend a particular company or individual to handle the repairs to avoid liability.  (If you provide any suggestions, always suggest MULTIPLE options and let your seller choose the contractor to do the work.)

As a property manager, it can be difficult because you work for the property owner/landlord. You might find conversations with the DIY property owner difficult. However, unless the property owner is experienced in the repairs in question, a cheaper DIY fix may lead to a lawsuit against both you and the owner. Even for owners experienced in repairs, those activities requiring permits, anything structural,  or any repairs involving gas should still be handled by a licensed contractor.

Failure to advise the property owner in writing about your recommendation to hire a licensed contractor to complete the repairs puts you in a vulnerable position.  If something goes wrong, it’s not just the DIY property owner that can be sued. Licensees and property managers can also be sued if dangerous DIY repairs lead to property damage, injuries, or death.

If your landlord client wants to proceed against your recommendation and DIY a repair, of course that is his or her choice. If they advise you to use a handyman that is not licensed, be sure you put your recommendation for a licensed contractor in writing, and get the landlord’s reply in writing. Have the landlord choose the person to handle the repairs, not you and confirm such in writing saved in your transaction file.

E&O Insurance Protection for Real Estate Licensees and Property Managers

Real Estate E&O insurance and Property Manager E&O insurance are essential protections for your real estate business. CRES has been a real estate E&O specialist for more than 25 years, and has access to more E&O options than just about anyone (we’re part of one of the largest insurance brokers in the world).

Let us find the best E&O protection for the best price to cover your specific risks. The friendly CRES team is ready to take your call today. Phone 800-880-2747 for a confidential discussion.

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