Landlords beware. There is a bizarre and nerve-racking trend going on in certain states like California where squatters are taking advantage outdated laws to live rent-free. This little loophole in real estate law gained exposure in a recent incident involving an Airbnb landlord and tenant. In this particular case, an Airbnb tenant refused to leave a Palm Springs condo after his month long-lease. Not only did he refuse to leave, but he told the landlord via a text message that "he was legally occupying the condo" and threatened to press charges against the landlord. The dispute is ongoing, and according to the San Francisco Chronicle, the landlord, likely, have to pay thousands in legal fees and follow a 3-6 month eviction process in order to remove the squatter. Needless to say, this is a setback for the landlord, whom works as a physical therapist and owns just the one property in Palm Springs.
How to Prepare for Squatters
Squatters come to inhabit properties in many forms. Some look for vacant properties, break in, and try to take advantage of the long, drawn-out foreclosure or escrow proceedings. Others, like the Palm Springs squatter, are using less regulated services like Airbnb and Craigslist to gain entrance to the property, and then, basically, refuse to leave. In states like California, where laws tend to lean in favor of tenants, there is no quick and simple way to deal with squatters. The optimal outcome is to catch the culprit before giving them access, or to catch them early on in the process. To do this, the first set of precautions one should take is to inspect and monitor properties. This includes the escrow process for newly acquired properties. Ensure that no one is hiding in the property before signing off on a sale. If the property is sitting vacant for any extended period of time, make sure to check in on it regularly. The next precaution to take is to implement a screening process to weed out sketchy characters (see our article on tenant selection).
How to get Rid of Squatters
It's virtually impossible to completely mitigate the risk of renting to a squatter. Screening will certainly lower the risk, but smart schemers have a way to gaming these screens. Once the a squatter has been identified in the property, the best thing a landlord can do is to serve notice as soon as possible. It is important to do so by the book (See our article on the eviction process for some help), so make sure to follow the rules of your state when doing so. Depending on the state, this notice can be 3 days or longer to exit the property. If this doesn't result in the squatter leaving, then there will be legal proceeding, including a trial. It's best, at this point, to hire a lawyer to help convince a judge that the squatter has no right to live at the property. Ultimately, the judge can rule in favor of damages awarded to the landlord, and finally for the removal of the squatter, where a law enforcement officer will physically remove him or her from the property.
Unfortunately for landlords, some of the laws written around tenants and landlords were created to help individual tenants from abuse of wealthy, more powerful, property owners. The laws tend towards the edge cases where landlords have abused tenants in the past. They aren't all relevant or fair in today's society, and especially aren't all fair for property owners trying to earn income or build that nest egg for retirement. Getting involved civically to change these laws would be a great, long-term, step to change some of the unfairness, but otherwise one has to play with the hand that has been dealt. Hopefully, an incident like the one in Palm Springs won't happen to you, but if it does, make sure that you are prepared.