How Can Property Managers Prevent Squatters

According to the UN, 10% of the world’s population are estimated to be squatters. In the US, particularly, squatters continue to be a persistent problem for property managers. The housing bubble in North America too led to a significant increase in squatters as affordable housing got harder to find.  

Property managers have taken preventative measures by investing in lockboxes to keep their properties safe.

Who are squatters?

As we move forward with our blog, it’s important to know who exactly qualify as squatters.

Trespassers vs squatters

The first distinction to make is between trespassers and squatters.

Trespassers enter the property for a short period of time, sometimes with the intent to cause damage. They may live on the property temporarily and do not claim ownership. Trespassers have rights too but it is easier to classify their actions as illegal and therefore evict them.  

Squatters, on the other hand, reside on the property for years at an end and claim ownership. Hence, getting rid of squatters is harder and more often than not, a legal headache. Squatters have also been given rights by each state, making it possible for them to claim ownership.  

Squatter tenants are the existing tenants who:

• Refuse to pay rent or move out.
• Continue to live on the property even after their lease has expired.
• Are victims of rental scams who live on the property and have been unknowingly paying rent to someone who is not the owner.  

Tips to prevent squatters

Dealing with squatters can be a massive headache for property managers. It costs time, energy and money that they often can’t spare. According to property management experts, here are a few effective and simple tips to avoid squatters on your property:

• Conduct regular property inspections
• Make sure you’re marketing all your vacant properties to find tenants faster
• Erect signs on your property such as ‘private property, no trespassing’.  
• Maintain a working security system that immediately alerts you.  
• Using lockboxes as opposed to keys is more effective at preventing break-ins. Click here to learn about secure lockboxes.
• Using tools like SimpliSafe to trigger security alarms and remotely terminate showings.
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• Avoid tenants turning into squatters:
  1. Contact previous landlords of tenants to run background checks
  2. Conduct thorough screenings. (Pro tip: invest in a property management software that does it for you. LetHub pre-qualifies prospects so only the leads who meet the criteria are able to book a showing. Learn more here).
  3. Be extra strict with rent payments
  4. If the tenant under whom the lease is signed passes away, change locks and secure the property until you have documentation for whoever will be handling estate. No family or friends should be allowed in to stay in unit or remove any belongings until documentation is received.
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• If your house has been on the market for a bit, take steps to make your property appear occupied. For example:
  1. Regularly collect mail instead of letting it pile it in the mailbox
  2. Draw or shut curtains when you drop by for an inspection
  3. Keep the landscape clean and maintained
  4. Talk to the neighbors and ask them to inform you if they see anything weird
  5. Make sure you visit the property at least thrice a month for inspections
  6. If it's winter season, turn off water supply

What you must do as a property manager if you get squatters

If you find squatters on your property, you have to take an immediate action. Any delays on your part will only strengthen the squatter’s claim. Here are the necessary steps you must take to get of squatters.

• Contact the authorities
• Inform the owners
• Collect proof of ownership – e.g. utility bills still addressed to the owner
• Read up on your state’s squatter rights
• Find an attorney experienced in evictions

What you cannot do as a property manager if you get squatters

Unfortunately, if you do find squatters on your property, there is no easy way to get rid of them. Squatters have rights, protected by their state. Here’s a list of things you absolutely cannot do should you ever find yourself in this situation:  

• You cannot force them out
• You cannot take actions to make the property uninhabitable
• You cannot turn off the utilities on a squatter
• You cannot use coercion to evict squatters

What have state laws got to do with it?

Squatter rights, simply put, give squatters a chance at ownership of the property if they haven’t been evicted by the rightful owners within a set period of time. This period is called the statute of limitations and it differs from state to state.  

These are the 6 states with the most lenient squatter rights. Here’s what is required of the squatter in each state to claim ownership:

Arkansas and Utah: Live on the property and pay taxes for 7 years

California and Montana: Lived on the property and pay taxes for 5 years

Florida: Live on the property for 7 years and either hold a color of title or pay taxes

Tennessee:  Live on the property for 7 years and have a color of title

What is color of title?

Having "color of title" means possessing a property without proper registration or missing necessary legal documents. It can be claimed through an adverse possession claim if the squatter fulfills certain legal requirements.

Adverse possession and why property managers should know about it

Adverse possession is the when squatters are legally granted ownership of the property. Yes, it happens. Property managers should be aware of the adverse possession laws in their state and have a real estate attorney who is experienced in squatter evictions to avoid a lengthy legal battle.  

The silver lining - there are a lot of conditions that must be met before a squatter qualifies for adverse possession.  

• Actual - The squatter must actually have been residing on the property for the required period of time.  
• Open and Notorious – The property has to have been occupied openly and not in secret. ‍
• Continuous – The squatter must have occupied the property for the required number of years as per state law ‍
• Exclusive – The land should be occupied by one legal party exclusively ‍
• Hostile – There must be some contest over the legal ownership of the property with the landlord or owner.  
• Other - The squatter is also required to meet other requirements depending on the state e.g. paying taxes holding color of title.  

While squatters exist in almost every state, it is not necessary that you will have you deal with one. However, it is still advised that you take the necessary precautions to avoid squatters. In case you do find squatters on your property, immediately seek legal help and ensure all communication is formal and in accordance with state laws.