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PAGE 41 BEST WAYS TO PROTECT YOUR RENTALS IN 2026
SPRING 2026
EXPOSED: THE BIGGEST RISKS FACING LANDLORDS
NEW TENANT FRIENDLY LAWS
WHEN SECURITY DEPOSITS DON’T COVER THE LOSS PAGE 75
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WHY EVICTIONS ARE DISAPPEARING FROM COURT RECORDS
VERIFYING EMOTIONAL SUPPORT ANIMAL REQUESTS
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PAGE 59
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THE OFFICIAL PUBLICATION OF THE AMERICAN APARTMENT OWNERS ASSOCIATION
AAOA.COM
TEAM VP Robbie Cronrod Editor in Chief
Alexandra Alvarado Contributing Editors Allen Artcliff-Cronrod Nancy Abrams Contributors Alexandra Alvarado
Bradley Barth Brandon Rush Brian Tulibaski Christian Walsh Dave Mencel David Holland Destiny Roxas Dwight Kay
CONTENTS
Jason Kogok Jesse Bailey Jillian Pulire Joshua Christensen Kaylee McMahon- Boncour Kelly Brown Lauren Lieb Leslie Tucker Lisa Cozzi Mitch Speigle Nancy Abrams Nate Bernstein Richard D. Gann Rick Albert Shiral Torres Tara Samuels Taylor Avakian
04 12 19
HOW TO SETTLE A CALIFORNIA EVICTION CASE THE SMART WAY
HOW TO LEGALLY VERIFY EMOTIONAL SUPPORT ANIMAL REQUESTS
CHOOSING THE RIGHT ADVISOR FOR A 1031 EXCHANGE: STOCK BROKER OR SPECIALIST?
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NEW TENANT FRIENDLY LAWS LANDLORDS SHOULD BE WATCHING IN 2026
Ted Sutton Tina West
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Welcome to RENT! As the snow melts and flowers appear, it’s a great time to refocus on shielding yourself and your investments from legal exposure and financial loss. This issue centers on something every landlord is navigating today: staying protected in an increasingly complex legal environment. From settling eviction cases strategically to understanding why evictions are disappearing from court records, the landscape continues to evolve. At the same time, new tenant-friendly laws are reshaping expectations, making it essential to stay informed and proactive. Risk mitigation now extends to properly verifying emotional support animal requests, staying current with compliance requirements, addressing pest issues and trespassers, and strengthening your asset protection strategy beyond an LLC. We also explore the financial side of protection, including 1031 exchanges, reducing taxes when selling a rental, and the future of independent real estate investing. On the lighter side, enjoy a tour of Fargo, ND, as well as Celebrities on the Move for a look at some truly unique homes. We hope you enjoy this issue of RENT and find the articles useful in your day-to-day business. Please send your feedback and ideas for future articles to nancy@aaoa.com. Happy reading!
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BEST WAYS TO PROTECT YOUR RENTALS IN 2026 THE RENTAL RADAR: FARGO, ND BED BUGS, ROACHES, TERMITES AND OTHER THINGS THAT BUG YOU DON’T LET TRESPASSERS THREATEN YOUR RENTAL INVESTMENT HOW INVESTORS CAN SAVE TAX WHEN SELLING RENTAL PROPERTY WHY EVICTIONS ARE DISAPPEARING FROM COURT RECORDS AND WHAT LANDLORDS SHOULD DO ABOUT IT WHEN AN LLC ISN’T ENOUGH: LAYERING YOUR ASSET PROTECTION STRATEGY ARE THE GLORY DAYS OF INDEPENDENT REAL ESTATE INVESTING FADING? WHEN SECURITY DEPOSITS DON’T COVER THE LOSS
CELEBRITIES ON THE MOVE
HOW INDEPENDENT LANDLORDS ARE ADAPTING TO A NEW MARKET
RATES ARE FALLING, BUT COVERAGE IS SHRINKING: THE NEW INSURANCE TRAP FOR LANDLORDS
Disclaimer: All content provided here-in is subject to AAOA’s Terms of Use . Nothing contained on this website constitutes tax, legal, insurance or investment advice, nor does it constitute a solicitation or an offer to buy or sell any security or other financial instrument. AAOA recommends you consult with a financial advisor, tax specialist, attorney or other specialist who is able to properly advise you.
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HOW TO SETTLE A CALIFORNIA EVICTION CASE THE SMART WAY Whether you are negotiating a settlement in court, outside the courtroom, during mediation, or at a mandatory settlement conference, resolving an unlawful detainer case with a tenant is often a rushed process and remains an inexact science. For landlords, settlement can be the fastest and most predictable way to regain possession of a rental property. Trials can be time consuming, expensive, and uncertain, particularly when tenants request a jury trial or pursue procedural delays. A well drafted settlement agreement can provide a clear path to recovering the unit while minimizing legal costs and the risk of future disputes. This article explores strategies for negotiating and structuring settlement agreements in California unlawful detainer cases, including how judges can help facilitate a resolution and why clear, enforceable terms are essential.
KEEP SETTLEMENT AGREEMENTS CLEAR AND SPECIFIC
Sometimes in court, parties are constrained because there is usually very little time to negotiate and draft the agreement, so it is best to keep the language of the settlement agreement simple and easy to understand with a limited amount of legalese.
There need to be specific tasks and specific dates for compliance. The court should review the agreement with the tenant, so the tenant understands what they are signing and what their obligations are. Then the tenant needs to personally sign the agreement and get a copy of it.
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INVOLVING THE COURT IN SETTLEMENT DISCUSSIONS
You or your attorney should ask the judge assigned to the case to set a mandatory settlement conference in the courtroom assigned or before another judge. Judicial assistance is very important in trying to achieve an expeditious written settlement.
Having a Mandatory Settlement Conference with a judge in the courthouse can also be a positive action to shift some leverage back to the landlord. The tenant will not want to listen to the landlord’s attorney, but the tenant may listen carefully to everything a judge says, including the suggestion of important settlement terms.
THE PSYCHOLOGY OF SETTLEMENT IN AN UNLAWFUL DETAINER ACTION
It takes both sides to agree in writing to a settlement. In unlawful detainer cases, landlords always want to settle cases as soon as possible. Settlement provides certainty on the issue of possession and saves legal fees. Tenant defendants are usually not in a settlement mindset early in the case, and likely have access to paralegals, attorneys, legal aid and public interest law firms for guidance. During an unlawful detainer action, settlement
dynamics are often influenced by timing, leverage, and procedural strategy. Because tenants are not paying rent during the pending unlawful detainer action, they may want to slow down a settlement, delay a trial date, or ask for a cash for keys deal. A tenant may also demand a jury trial, and the scheduling of a jury trial can provide them with procedural and calendar leverage that may influence settlement discussions.
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The concept of “leverage” in the negotiation of a settlement is very important. If a jury trial date is set, landlords will not have settlement leverage and need to take action to shift that leverage back to the plaintiff’s side. HOW TO GET YOUR LEVERAGE BACK
THE CONCEPT OF “LEVERAGE” IN THE NEGOTIATION OF A SETTLEMENT IS VERY IMPORTANT.
Two strategies that landlords can use include:
• Serving written discovery on the tenant • In an appropriate case, calendaring and filing a motion for summary judgment
If the tenant is tired of receiving discovery from the landlord and is fatigued from being in the court system, with the help of the settlement judge, the tenant may be in a frame of mind to settle the case.
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ASK THE JUDGE TO TAKE AN ACTIVE ROLE
You can ask the judge in the case or another judge in the courthouse to conduct a Mandatory Settlement Conference in the case. Some judges may be interested in conducting a judicial settlement conference with the parties and attorneys present. It is best to have this conference early in the case before the parties incur the expense of preparing for a bench or jury trial. A judicial settlement conference can be conducted at any stage of the case, and even during the trial itself. Judges would rather spend an hour conducting a settlement conference than have a trial that could last for several hours or days if it is a jury trial. It is my experience that robed judges have more influence in conducting a judicial settlement
conference and can push the tenant to come to an agreement with reasonable terms. Judicial settlement conferences may be more effective than having an attorney mediate the case. Judges can meet with both sides separately to conduct “shuttle diplomacy,” and narrow the issues. In addition, a judicial settlement conference is typically less costly than private mediation.
A JUDICIAL SETTLEMENT CONFERENCE IS TYPICALLY LESS COSTLY THAN PRIVATE MEDIATION.
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SETTLEMENT TERMS THE COURT MAY ADDRESS During a judicial settlement conference, a judge may discuss several important issues that can shape the terms of a settlement agreement including:
What is discussed in a judicial settlement conference:
• Entry of judgment if the tenant fails to comply with the agreement • Dismissal of the case with prejudice or without prejudice • Confidentiality of the case file • Future hearings to monitor compliance with the settlement terms
Note : Courts may also retain jurisdiction under California Code of Civil Procedure Section 664.6, which allows a court to enforce a settlement agreement after the case has been dismissed.
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HAVE THE SETTLEMENT REVIEWED ON THE RECORD
In many California courts, the judge may review key provisions of the settlement agreement, including: • The tenant’s move out date • Payment obligations and payment deadlines • Any conditions required for the case to be dismissed • What will happen if the tenant fails to comply with the agreement • Rights the tenant may be waiving, such as the right to a jury trial or certain defenses If the parties come to an agreement on settlement terms, the court should take an active role to complete and monitor the process. It’s best practice to have the judge review the specific terms of the settlement agreement on the record in court with the tenant. The judge should ask the tenant if they understand all the terms and conditions of the agreement and what their obligations and responsibilities are pursuant to the terms of the settlement agreement. This protective measure prevents the tenant from later claiming with any credible argument they didn’t understand the terms or were pressured into signing. After the settlement agreement has been signed, the court can set a follow-up hearing to monitor the status of the settlement, and to see if the tenant has vacated.
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EVERY AGREEMENT SHOULD BE DRAFTED WITH PRECISION AND FORESIGHT, AND WITH ASSISTANCE OF YOUR OWN COUNSEL.
FINAL THOUGHTS ON ACHIEVING A RESOLUTION Attorneys and parties should get the court involved in the settlement process by scheduling a judicial settlement conference early in the case. Unrepresented tenants may want this process so they have some additional safeguards and protection. By addressing specific settlement terms and issues, landlords can strive for settlement agreements that are well drafted, that help you achieve the goals of the case, avoid costly surprises, and that can limit exposure to future claims. These provisions help avoid post-settlement disputes, reduce the likelihood of a successful tenant challenge of a settlement provision, and provide a clear roadmap for regaining control of the premises and enforcement of judgments. Since settlement is a more cost effective alternative to completing a jury trial or a bench trial, the details matter. Every agreement should be drafted with precision and foresight, and with assistance of your own counsel.
NATE BERNSTEIN Managing Counsel LA Real Estate Law Group natebernstein44@gmail.com (818) 383-5759
Nate Bernstein, Esq., is the Managing Counsel of LA Real Estate Law Group, and a member of the State Bar of California and his practice concentrates in the areas of complex real estate title litigation, commercial litigation, landlord tenant law, employment law, and bankruptcy matters. Mr. Bernstein also has expertise in bankruptcy law, the federal bankruptcy court system, creditor’s rights and out of court workout solutions. He serves as an expert witness on real estate, title, joint venture, and other business relationship dispute issues.
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Let’s be real: the “Emotional Support Animal (ESA) letter” has become a major source of professional anxiety. Between the explosion of online “certification mills” and the uncertainty of how to enforce property rules without triggering a lawsuit, it’s easy to feel like your pet policy is under siege. The fraud fatigue is valid, and the skepticism is often earned. But here’s the good news: Compliance isn’t about giving up your standards; it’s about standardizing your process. When you move from a mindset of investigating a person to verifying a credential, the legal landmines are few and far between. HOW TO LEGALLY VERIFY EMOTIONAL SUPPORT ANIMAL REQUESTS
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IF YOU ONLY REQUIRE ADDITIONAL VERIFICATION FOR THE LETTERS THAT LOOK FISHY, YOU’RE THE ONE BREAKING THE LAW.
THE VERIFICATION MINDSET: UNDERSTANDING THE LINK
Think of an ESA request like verifying a professional license or a contractor’s bond. You aren’t grilling the applicant because you’re suspicious; you are simply validating that the request meets a specific legal standard. To do this effectively, you must focus on the direct, documented link between the individual’s disability and the assistance the animal provides. When a resident submits a letter, your job is to ensure it comes from a reliable source. Under HUD guidelines, a reliable source is a healthcare professional with personal knowledge of the patient. If a letter comes from a website that sells registries or IDs after a three-minute survey, it often lacks the professional relationship required by law. However, the key to staying safe is applying the same verification steps to every request. If you only require additional verification for the letters that look fishy, you’re the one breaking the law. Consistency is your best defense against an ESA “sting” operation.
Avoid saying:
“This letter looks fake; we need to talk to your actual doctor.” Using words like “fake” or “scam” creates a hostile environment, whereas sticking to standard processes and procedures keeps you on firm legal ground.
Say this instead:
“We have a standard verification process to confirm the requested accommodation with your verifier.”
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YOU ARE ALLOWED TO ASK FOR THE ANIMAL’S BREED, SIZE, COLOR, AND A CURRENT PHOTO.
THE VALIDATION SHIELD: FOCUSING ON THE ANIMAL
Beyond the letter, you have a right to know who—and what—is living in your units. Building a “Validation Shield” means focusing on safe questions in regard to the property, instead of verification inquiry. You are allowed to ask for the animal’s breed, size, color, and a current photo. This isn’t about policing the animal; it’s a safety measure to ensure management can identify the animal if it escapes or if there is an emergency on site. Furthermore, while you can ask about an animal’s history of aggression, you must do so uniformly. If you only ask for the history of a specific breed or only for ESAs, you are likely in violation. Targeting an ESA for an “aggression check” when you don’t do the same for a standard pet is a fast track to a fair housing complaint.
Avoid saying:
“Since this is an ESA, we need to know its full history of aggression.”
Say this instead:
“We ask all residents, pet owners and assistance animal handlers alike, to provide identifying markers and a photo for our files in case of emergencies.” This ensures that if the animal were to escape, management has the markers to find it safely without creating a discriminatory barrier.
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YOU DO NOT HAVE TO WAIVE BASIC CONDUCT AND SAFETY STANDARDS.
THE CONDUCT CLAUSE: ESAs AREN’T ABOVE THE LAW
A common myth is that an ESA designation gives an animal a “free pass” to behave however it wants. The bottom line? It doesn’t. While you must waive pet fees and certain restrictions, you do not have to waive basic conduct and safety standards. •Leash Laws Apply: If your property or local municipality requires animals to be leashed in common areas, that applies to ESAs too. An assistance animal is not exempt from local safety ordinances. •The “Unreasonable” Line: An accommodation becomes “unreasonable” if the animal poses a direct threat to the safety of others or causes significant physical damage to the property. You are not required to tolerate an animal that is fundamentally disruptive or dangerous.
Avoid saying:
“Because it’s an ESA, we can’t do anything about the barking or the damage.”
Say this instead:
“While we waive pet fees for assistance animals, all residents are required to follow community conduct rules, including leash laws and noise ordinances.” This clarifies that while the animal is allowed, the behavior must still meet the property’s standard.
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IN THE EYES OF THE LAW, AN EMOTIONAL SUPPORT ANIMAL IS NOT A PET.
THE “NO-PETS” POLICY: A LEGAL DISTINCTION
What about the select properties out there that prefer to have a no-pets policy in place? While it does take some of the nuance out of the picture, your initial conversations become the highest-risk moments for a fair housing complaint. It is vital to remember that in the eyes of the law, an Emotional Support Animal is not a pet. It provides assistance for a person with a disability (a federally protected category), similar to a wheelchair or a glucose monitor. When a prospect asks about your policy, a blanket “no animals” statement can be interpreted as a refusal to grant a reasonable accommodation before the request is even made.
Avoid saying:
“We don’t allow animals here.”
Say this instead:
“We are a no-pets property, but we gladly accommodate assistance animals in compliance with fair housing laws.” This phrasing protects your “no-pets” status for standard animals while still demonstrating respect and understanding of federal disability rights.
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CONCLUSION: CONSISTENCY IS KING Fair Housing compliance isn't a hurdle to your performance; it’s the floor you build it on. In the high- stakes world of property management, skepticism can be a natural defense mechanism, but it shouldn't be your policy. When you move away from the "investigator" role and embrace the "professional processor" role, you remove the friction that leads to costly legal disputes. By using a uniform verification process, asking the same safe questions of every resident, and keeping your communication focused on compliance rather than personal opinion, you create a property culture that is both welcoming and secure. You don't have to choose between protecting your assets and following the law. With clear policies in place, you can confidently navigate the nuances of assistance animals while keeping your standards high and your liability low.
YOU DON’T HAVE TO CHOOSE BETWEEN PROTECTING YOUR ASSETS AND FOLLOWING THE LAW.
LESLIE TUCKER, ESQ. Principal Partner Williams Edelstein, Tucker, P.C.
Leslie is the Principal Partner of Williams Edelstein, Tucker, P.C., a fair housing defense law firm, and serves as the Assistant Vice Present at the Fair Housing Institute. With a career dedicated to defending housing providers across the country, Leslie offers over a decade of expertise in fair housing matters. Leslie represents her clients in administrative fair housing cases, assists with drafting and updating company policies, consults on day-to-day fair housing-related decisions, and provides live training sessions on fair housing laws, federal housing programs, and landlord-tenant issues. Additionally, she is an expert in physical accessibility standards for multifamily housing, encompassing both local building codes and federal requirements like the Americans with Disabilities Act (ADA) and the Fair Housing Act (FHAAG). Leslie has been actively involved in consulting and training with the Fair Housing Institute since 2021.
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CHOOSING THE RIGHT ADVISOR FOR A 1031 EXCHANGE: STOCK BROKER OR SPECIALIST? For rental property owners approaching the sale of a long-held asset, the stakes surrounding a 1031 exchange are unusually high. A lifetime of equity growth, depreciation recapture exposure, and capital-gains taxes can hinge on a transaction that must comply precisely with the requirements of Internal Revenue Code §1031 and its accompanying regulations. Yet many investors instinctively turn to national stock-brokerage firms (aka “wirehouses”) when seeking advice. When the objective is to transition from active property ownership into a passive 1031-qualified replacement investment, such as a Delaware Statutory Trust (DST), a Qualified Opportunity Zone Fund, or another private-placement real estate program, investors are often better served by independent
boutique specialists whose practices focus specifically on these transactions. The difference is not merely stylistic. It is structural, economic, and professional.
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SPECIALIZATION MATTERS IN 1031 TRANSACTIONS A 1031 exchange is not a conventional securities purchase. It is a tax-driven transaction that sits at the intersection of real estate, securities regulation,
regularly handle 1031-qualified passive real estate investments. Independent boutique firms that specialize in exchange-related investments operate differently. Their professionals routinely evaluate DST programs, review sponsor track records, analyze underwriting assumptions, and coordinate with the other professionals involved in the exchange process. When millions of dollars of appreciated real estate equity are involved, that depth of experience matters.
and tax law. Successful execution requires understanding strict IRS deadlines, evaluating private real estate offerings, coordinating with qualified intermediaries, and navigating complex debt-replacement requirements. Most national brokerage firms are built around a broad retail model. Advisors manage portfolios of stocks, bonds, ETFs, insurance products, and retirement accounts for hundreds of clients. While many are capable generalists, relatively few
WHEN MILLIONS OF DOLLARS OF APPRECIATED REAL ESTATE EQUITY ARE INVOLVED, THAT DEPTH OF EXPERIENCE MATTERS.
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INSTITUTIONAL CONSTRAINTS INSIDE LARGE BROKERAGE FIRMS
Large brokerage firms operate under centralized product platforms and corporate oversight structures that shape what advisors are permitted or incentivized to recommend. Most national wirehouse firms maintain very short, approved product lists for private placements. These lists exclude otherwise strong offerings simply because they are not distributed through the firm’s internal channels. Even when DST programs are available, wirehouse bureaucracy can create additional friction. Advisors may need multiple layers of internal approval before presenting offerings to clients, and then must rely on sponsor wholesalers to effectuate the sale.
These constraints can slow decision making during the most time-sensitive portion of the exchange process: the 45-day identification period after the sale of the relinquished property. Independent boutique firms typically operate under a different model. Firms that revolve around private-placement real estate investments maintain broader visibility across the marketplace and can evaluate multiple sponsors and offerings simultaneously. For investors facing strict IRS timelines, that flexibility can make a meaningful difference.
ALIGNMENT WITH THE NEEDS OF REAL ESTATE INVESTORS
After years, or decades, of active ownership, many rental housing providers want to convert a hands-on property into a passive income-producing investment.
Achieving the transition to passive ownership requires careful analysis of:
Boutique firms that specialize in exchange- related investments regularly help clients transition from active landlord responsibilities to passive ownership structures. The focus is to meet the client’s lifestyle, tax and estate-planning goals, not to merely convert real estate equity into billable AUM.
Debt replacement requirements Cash-flow stability Sponsor strength and experience Property diversification Exit strategy
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DEEPER DUE DILIGENCE ON PRIVATE OFFERINGS Private real estate offerings differ substantially from publicly traded securities. They involve sponsor-level risk, property-specific underwriting assumptions, financing structures, and multi-year holding periods.
Because boutique firms evaluate these programs regularly, they often develop deeper institutional knowledge of the sponsor community. They understand which sponsors have successfully navigated multiple real-estate cycles and which ones have not. For investors allocating significant equity into long-term passive real estate investments, that experience can be extremely valuable.
Sponsor capitalization and operating history Property-level financial projections Debt structures and loan covenants Geographic market fundamentals Exit assumptions Evaluating these programs properly requires careful analysis of:
PRIVATE REAL ESTATE OFFERINGS DIFFER SUBSTANTIALLY FROM PUBLICLY TRADED SECURITIES.
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ONE OF THE MOST USEFUL TOOLS AVAILABLE TO INVESTORS IS FINRA BROKERCHECK.
MORE DIRECT ATTENTION DURING THE EXCHANGE PROCESS
Selling a property and completing a 1031 exchange often occurs under intense time pressure. Once the relinquished property closes, the investor typically has 45 days to identify replacement properties and 180 days to complete the exchange. During this compressed timeline, investors benefit from advisors who are responsive and deeply familiar with the transaction mechanics. Boutique firms generally operate with smaller client-to-advisor ratios, allowing for more direct communication and faster decision-making during the exchange window. For many investors, the experience feels less like dealing with a large institution and more like working with a dedicated advisory team focused on a single objective.
INVESTORS SHOULD CONDUCT THEIR OWN DUE DILIGENCE
Regardless of whether an investor works with a large brokerage firm or an independent specialist, conducting personal due diligence on financial professionals is essential. One of the most useful tools available to investors is FINRA BrokerCheck, a public database that allows individuals to review a broker’s licensing status, employment history, and disciplinary record. Before working with any securities professional, investors should review the advisor’s BrokerCheck profile carefully. Particular attention should be paid to disclosures involving fraud, criminality, or other forms of moral turpitude, as these issues may signal serious concerns about professional integrity.
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A DIFFERENT KIND OF ADVISORY RELATIONSHIP Ultimately, the decision between using a large stock-brokerage firm and a specialized independent advisor comes down to a simple question: Do you want a generalist or a specialist guiding one of the most consequential tax transactions of your financial life? For investors completing a 1031 exchange and transitioning into passive real estate investments, specialization can make a significant difference. Independent boutique firms dedicated to these transactions bring deeper expertise, broader market awareness, and a business model aligned with the needs of real estate investors. When a lifetime of real estate equity is at stake, that level of focus is not merely helpful, it is essential.
If you are interested in exploring options for relocating equity out of your state via a 1031 exchange, please contact 1031 Capital Solutions at 1031capitalsolutions.com or call us at (800) 445-5908.
RICHARD D. GANN, JD Managing Partner 1031 Capital Solutions (800) 445-5908 1031CapitalSolutions.com
Richard (Rick) Gann is an attorney, licensed real-estate broker, and general securities principal specializing in 1031 exchange solutions and he is co-author of the book How to Retire from Being a Landlord.
Disclaimer: This information is for educational purposes only and does not constitute direct investment advice or a direct offer to buy or sell an investment and is not to be interpreted as tax or legal advice. All opinions expressed herein constitute the author’s judgement as of the date of this article and are subject to change without notice. Statements made are not facts, including statements regarding trends, market conditions and the experience or expertise of 1031 Capital Solutions. Information is based on current expectations, estimates, opinions and/or beliefs of 1031 Capital Solutions. Such statements are not facts and involve known and unknown risks, uncertainties, and other factors. Past events and trends do not predict or guarantee or indicate future events or results. Securities offered through Concorde Investment Services, LLC (CIS), member FINRA/SIPC. Advisory services offered through Concorde Asset Management, LLC (CAM), an SEC registered investment adviser. Insurance products offered through Concorde Insurance Agency, Inc. (CIA). 1031 Capital Solutions is independent of CIS, CAM and CIA.
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Florida: CS/CS/SB 48, housing package with reusable tenant screening report provisions. Status: Effective July 1, 2026 What it does: Includes authorization and rules for reusable tenant screening reports, plus other housing related provisions (including local requirements tied to accessory dwelling units in the bill summary). For landlords, the reusable report piece can change application fee practices and screening workflows. California: passed AB 414, modernizes security deposit accounting and refunds. Status: Effective January 1, 2026 What AB 414 does: Updates how landlords deliver the itemized statement and return security deposits, including allowing electronic delivery and refunds under specified conditions. AB 1248, “junk fee” style rent pricing and fee limits. Status: Effective April 1, 2026 What AB 1248 does: Requires rental ads and offers to include required fees and charges, and to describe optional housing services and their fees. Proposes limits on what fees can be charged. New York City: LL86, ensures that tenants have clear, accessible information about whether their homes are rent-stabilized. Status: Effective: January 26, 2026 What it does: All multiple dwellings containing one or more rent-stabilized units must post a notice in a common area of the building, in both English and Spanish, informing tenants that rent-stabilized units exist in the building and explaining how to find out whether their unit is one of them. Hawaii: SB 2959, statewide requirement to accept comprehensive reusable tenant screening reports. Status: Effective November 1, 2026 What it does: Would require landlords to accept comprehensive reusable tenant screening reports if provided, and restrict application fees in that scenario. This directly affects how often landlords can charge screening related fees and how they verify report freshness and completeness. Local, state and federal lawmakers have been very busy passing new multifamily statutes, the majority of which have been decidedly tenant friendly. Here are a few of the more interesting pending multifamily laws and some that have already been passed into law: NEW TENANT FRIENDLY LAWS LANDLORDS SHOULD BE WATCHING IN 2026
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SB0937 Prospective tenant criminal history records. MARYLAND
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HB 1217 Improving housing stability for tenants.
SB 273 Eviction diversion eligibility changes and required court notice. VIRGINIA
SB 369 Proposed disclosures to prospective tenants and late fee restrictions. KANSAS
LL86 Gives tenants clear information on whether their homes are rent stabilized.
AB 414 and AB 1248 AB414 modernizes security deposit accounting and refunds, and AB1248, “junk fee” style rent pricing and fee limits with a 2026 timeline.
CS/CS/SB 48 Housing package with reusable tenant screening report provisions. FLORIDA
SB 2959 Statewide requirement to accept comprehensive reusable tenant screening reports. HAWAII
Washington: HB 1217, improving housing stability for tenants. Status: Effective January 1, 2026
What it does: Limits rent and fee increases, requires notice of rent and fee increases, limits fees and deposits, establishes a landlord resource center and associated services, authorizes tenant lease termination, creates parity between lease types, and provide for attorney general enforcement.
Kansas: SB 369, proposed disclosures to prospective tenants and late fee restrictions. Status: Pending What it does: Would require certain disclosures to prospective tenants and adds restrictions around late payment fees under the Kansas Residential Landlord and Tenant Act. A landlord may charge a reasonable late fee for the late payment of rent as set forth in a rental agreement. Virginia: SB 273, eviction diversion eligibility changes and required court notice. Status: Pending What it does: Amends the Virginia Residential Landlord and Tenant Act. Adjusts eligibility rules for the Eviction Diversion Program and requires courts using the program to attach program information and eligibility criteria to unlawful detainer summonses. It lowers the required upfront payment percentage and revises prior payment history limitations, which can change case outcomes and timelines.
Maryland: SB0937, prospective tenant criminal history records. Status: Effective October 1, 2026
What it does: Prohibits landlords from requesting or considering a prospective tenant’s criminal history before making a conditional offer, limits which convictions may be considered after that offer, and requires landlords to consider evidence such as rehabilitation or inaccuracies provided by the applicant.
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DON’T LET TRESPASSERS THREATEN YOUR RENTAL INVESTMENT Discovering someone on your rental property who shouldn’t be there is stressful and potentially risky. For landlords and property managers of single- or multifamily rentals, knowing how to respond protects tenants, your property, and your business. Beyond legal compliance, it’s about preventing headaches, financial loss, and liability exposure. This guide explains your rights, practical steps, and creative ways to keep your properties safe. WHAT IS WHAT COUNTS AS TRESPASSING
Trespassing occurs when someone enters or stays on your property without permission. According to FindLaw, “trespass to land occurs when a person intentionally enters another’s property without permission or legal right.” This could involve a former tenant who hasn’t vacated after their lease ends, a guest refusing to leave, or even a passerby cutting across your yard. Physical damage isn’t required to take action. Civil or criminal laws allow property owners to enforce boundaries even if nothing is stolen or broken. Wikipedia notes, “Intentional unauthorized entry may be sufficient to justify legal remedies.”
TRESPASSING According to FindLaw, “trespass to land occurs when a person intentionally enters another’s property without permission or legal right.”
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REAL-LIFE SCENARIOS YOU MIGHT FACE
The Guest That Overstayed Imagine a tenant’s friend visits for a weekend and refuses to leave. While it might seem minor, their presence increases liability risk, especially if they damage property or engage in illegal activity.
The Abandoned Property Squatter
Vacant rentals are magnets for trespassers. A property left unlocked, dark, or appearing neglected can attract someone to move in temporarily, creating complex legal and financial challenges. Property that look abandoned tend to attract unwanted visitors or squatters.
The Neighbor Shortcut
Even neighbors can trespass. Repeatedly cutting through your yard might seem trivial, but it’s still unauthorized entry and can create liability if someone is injured. A low fence or posted signage often resolves these issues before they develop into a dispute. These scenarios demonstrate why trespassing isn’t just about strangers. Tenants, guests, and even familiar faces can become unauthorized occupants.
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STEPS TO HANDLE TRESPASSING SAFELY AND LEGALLY
Prioritize Safety First, assess the risk. If the trespasser is aggressive, armed, or otherwise threatening, contact law enforcement immediately. Never attempt to confront someone in a dangerous situation. Your personal safety comes first.
1
Document Everything Record date, time, location, and descriptions. If safe, take photos or video. Accurate documentation is essential if the situation escalates or you need to pursue legal action. Documentation can also help with insurance claims if property damage occurs.
2
Ask Them to Leave if Safe If the situation is calm, politely inform the trespasser that they are not permitted on the property. A verbal or written request may resolve the issue. Refusal to leave strengthens your legal standing if further action is required.
3
Use Property Controls and Signage Clearly posted “No Trespassing / Private Property” signs, locked gates, fences, and security cameras make unauthorized entry harder and reinforce your legal rights. FindLaw reports, “Fences, cameras, good lighting, and clear signage are often key defenses landlords can install to protect their property.”
4
Call Law Enforcement When Necessary If someone refuses to leave or appears dangerous, local authorities can remove them and may issue citations or arrests depending on the situation.
5
Understand Your Legal Options Even without physical damage, unauthorized occupancy can be sufficient for civil trespass claims or criminal action, depending on state laws. Historical precedent confirms that unauthorized entry alone can justify legal remedies, as noted in Wikipedia’s coverage of Dougherty v. Stepp.
6
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PREVENTING TENANT-RELATED TRESPASSING
Former tenants or guests overstaying can be a common problem. Prevention is often easier than removal: • Change Locks Immediately: Never leave keys in vacant units. • Maintain an Active Appearance: Keep utilities on/off as appropriate, maintain landscaping, and keep windows lit at night. • Perform Regular Inspections: Especially for vacant or under-renovation units. Frequent visits deter unauthorized occupation. • Professional-Grade Security: Keyless entry smart locks that alert you when someone attempts unauthorized access, security cameras with real-time alerts, and motion-activated exterior lighting reduce risk. • Documentation: Maintain ownership papers, lease records, maintenance logs, and photos to demonstrate active property management.
FINANCIAL AND LIABILITY CONSIDERATIONS
Trespassing is more than an inconvenience. It’s a potential financial liability: • Insurance Complications: Unauthorized occupants may void certain property insurance protections if damages occur. • Legal Costs: Pursuing civil or criminal remedies can become costly if incidents are not well- documented. • Property Damage: Even minor damage adds up over time, and unresolved trespassing may escalate into more serious issues. Investing in proactive measures, such as security systems, signage, lock changes, and regular inspections, can save landlords substantial money and stress in the long run.
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TRESPASSING IS MORE THAN A NUISANCE. IT’S A RISK TO YOUR PROPERTY, TENANTS, AND BUSINESS.
CREATIVE PREVENTION STRATEGIES
Simulate Occupancy: Motion-activated lights that turn on at night give the impression someone is home. Smart Locks: Track who enters and exits, and receive alerts when someone attempts unauthorized access. Landscaping as Defense: Thorny bushes along fences or dense hedges can act as natural barriers without looking unwelcoming. Draw a Property Map: Identify vulnerable points like side entrances, windows, or alleyways. This simple visual tool helps you plan security enhancements. Tenant Screening: Before an applicant is accepted as a tenant, do an exhaustive AAOA landlord background check to look for any red flags about them. Clear Policies: Establish clear rules for guests in leases, including maximum stay limits and consequences for overstaying.
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LANDLORD LESSONS LEARNED
The following mini case studies highlight how proactive management prevents trespassing and reduces legal exposure. Lesson 1: A former tenant left a spare key behind. The landlord changed locks immediately and posted signage, preventing unauthorized re-entry. Lesson 2: A neighbor repeatedly walked through a backyard. Installing a small fence and posting a polite “Private Property” sign solved the issue without conflict. Lesson 3: An abandoned-looking vacant unit attracted someone attempting to squat. Regular inspections and security cameras prevented further intrusion.
CONCLUSION
Trespassing is more than a nuisance. It’s a risk to your property, tenants, and business. By understanding your rights, documenting incidents, responding safely, and implementing creative preventative measures, you reduce the chance of unauthorized entry and can react effectively if it occurs. Tenant-related trespassing, such as former tenants or overstaying guests, is just as critical to address as random intrusions. Clear policies, consistent security measures, and active management signal that your property is monitored, deterring potential trespassers before problems arise. As FindLaw emphasizes, “trespass to land occurs when a person intentionally enters another’s property without permission or legal right.” Taking action now from signage and locks to law enforcement involvement, if necessary, ensures your rental property remains secure and your investment protected.
NANCY ABRAMS Assistant Editor American Apartment Owners Association (866) 579-2262 nancy@aaoa.com
Nancy Abrams has enjoyed a long career in real estate marketing throughout Southern California and Las Vegas. She formerly represented 19 Merrill Lynch Realty branch offices, property managers The Roberts Companies, new home developers, including master planned communities Peccole Ranch and The Valencia Company and shopping centers for Sandy Sigel of NewMark Merrill.
Disclaimer: All content provided here-in is subject to AAOA’s Terms of Use. Nothing contained on this website constitutes tax, legal, insurance or investment advice, nor does it constitute a solicitation or an offer to buy or sell any security or other financial instrument. AAOA recommends you consult with a financial advisor, tax specialist, attorney or other specialist who is able to properly advise you.
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PAGE 35
ADVERTORIAL
HOW INVESTORS CAN SAVE TAX WHEN SELLING RENTAL PROPERTY Selling a rental property represents one of the biggest financial decisions you will make as a real estate investor. The question isn’t just about timing the market or finding the right buyer. It’s about what happens to your hard-earned profits after the sale. With tax rates reaching as high as 28.8% in states like Washington and 42.1% in states like California, cashing out immediately can significantly impact your investment returns. The good news? You have options that can help preserve more of your capital while aligning with your long-term financial goals.
CASHING OUT IMMEDIATELY CAN SIGNIFICANTLY IMPACT YOUR INVESTMENT RETURNS.
PAGE 36
UNDERSTANDING YOUR INVESTOR PROFILE
Before diving into tax strategies, it is important to understand where you stand as a property owner. Your approach to selling should match your investment objectives and lifestyle preferences.
Active investors typically want to remain hands-on with their real estate portfolio. They are comfortable balancing risk with returns, often concerned about current market conditions, and less likely to use complex tax strategies. These investors usually focus on optimizing their portfolio through strategic buying and selling.
Property divestors on the other hand, are ready to exit the active management game. They are looking to reduce risk, increase passive income, and are particularly concerned about tax liabilities. This group commonly explores a 1031 Exchange to transition their investment strategy while deferring significant tax payments.
THE TAX REALITY OF SELLING RENTAL PROPERTY
When you sell a rental property, you typically face two primary paths. The first involves cashing out and paying taxes immediately on your capital gains and depreciation recapture. Depending on your location and income level, this can mean losing up to 42.1 percent of your profits to taxes, as in California. The alternative involves using a 1031 Exchange to defer those taxes by reinvesting into another qualifying property or investment vehicle. A 1031 Exchange allows property owners to defer taxes while reinvesting in new opportunities, effectively keeping more capital working for them in the market.
Net Sales Proceeds Total Estimated Taxable Gain Accumulated Depreciation Estimated Total Tax Liability Funds Available for Reinvestment Tax Liability 5% Annual Return on Reinvestment
$2,600,000 $1,900,000 $400,000 $0 $2,600,000 1031 Exchange $130,000
Cash Out
$2,600,000 $1,900,000 $400,000 $567,400 $1,726,700
$86,335
*Example Calculation: California state investment property with 22 years of ownership.
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DELAWARE STATUTORY TRUST (DST) INVESTMENTS OFFER A HANDS-OFF APPROACH TO REAL ESTATE OWNERSHIP.
DELAWARE STATUTORY TRUST: A PASSIVE INVESTMENT ALTERNATIVE For investors ready to step back from active property management, Delaware Statutory Trust (DST) investments offer a hands-off approach to real estate ownership. These professionally managed investment vehicles allow you to maintain Delaware Statutory Trusts provide several advantages for property divestors, including geographic diversification, professional
management, and the ability to own fractional interests in institutional-quality properties that would otherwise be out of reach for individual investors. Though DST investments may provide passive real estate exposure, it is important to know they involve risks, including illiquidity, lack of control over property management decisions, and potential loss of principal. Want to Know How Much Tax You Can Save? Calculate Tax Savings Instantly Get Results
real estate exposure while eliminating the day- to-day responsibilities of being a landlord. DSTs are typically offered through private placement offerings and are generally available only to accredited investors.
FREE 1031 CALCULATOR
PAGE 38
CHOOSING THE RIGHT REAL ESTATE EXIT STRATEGIES FOR YOUR GOALS
Effective real estate exit strategies should align with your long-term financial goals and lifestyle preferences. Whether you are preparing for retirement, relocating, or simply want to reduce the stress of property management, the key is understanding your options before you need them. The 1031 Exchange process requires careful planning and professional guidance. Timing is critical, and there are specific rules about identifying replacement properties and completing transactions within designated timeframes. Working
with experienced professionals who understand both the technical requirements and investment options can make the difference between a successful transition and a costly mistake.
THE KEY IS UNDERSTANDING YOUR OPTIONS BEFORE YOU NEED THEM.
MAKING YOUR NEXT MOVE
Understanding how a 1031 Exchange works may help investors defer a significant portion of taxes depending on their situation. Whether you choose to reinvest in another rental property or transition to a more passive investment like a Delaware Statutory Trust, the goal is to preserve capital by deferring taxes. The best real estate exit strategies consider both tax implications and lifestyle changes. With over 27 years of experience helping property owners
navigate these transitions, Real Estate Transition Solutions (RETS) Advisors focus on education and transparency to ensure you make informed decisions that serve your long-term interests. Your rental property sale doesn’t have to mean losing a significant portion of your profits to taxes. With proper planning and the right guidance, you can transition your investment strategy while keeping more of your capital working toward your financial goals.
ABOUT REAL ESTATE TRANSITION SOLUTIONS
Real Estate Transition Solutions (RETS) is a consulting firm specializing in tax-deferred 1031 Exchange strategies and Delaware Statutory Trust property. For over 27 years, we have helped investment property owners perform successful 1031 Exchanges by developing and implementing well-planned, tax-efficient transition plans carefully designed to meet their objectives. Our team of licensed 1031 Exchange Advisors will guide you through the entire process, including help selecting and acquiring passive management replacement properties best suited to meet your objectives. To learn more about 1031 Exchanges and Real Estate Transition Solutions, visit re-transition.com/aaoa or call us at 888-377-5131.
Disclaimer: This material is for informational purposes only and is not investment, tax, or legal advice. All investments involve risk, including loss of principal. Representatives are registered with Aurora Securities, Inc. (ASI) Member FINRA/SIPC. Advisory services are offered through Secure Asset Management, LLC. (SAM), a registered Investment Advisor. ASI and SAM are affiliated companies and maintain common ownership. RETS is not affiliated with ASI or SAM.
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