Legal Compliance Checklist for New Properties

Confirm the parcel's zoning code (e.g., R-2, RM-1, C-1) on the municipal GIS or planning department portal. Verify the intended use — long-term rental, short-term rental, mixed-use — is permitted by right, not just by conditional use permit. Short-term rental bans (Austin, Santa Monica, NYC Local Law 18) catch operators who assumed residential zoning was enough.

Review planning commission agendas and any active rezoning, historic district, or rent-stabilization overlay proposals affecting the parcel. A pending overlay can convert an unregulated unit into a rent-stabilized one before your first lease — common in LA, NYC, and St. Paul.

Walk the property against the local code checklist — egress windows in bedrooms, GFCI outlets in wet areas, handrails on stairs of four or more risers, ceiling heights. Use HappyCo or zInspector to capture photos and notes against a code template.

Most states require working detectors before move-in — one per bedroom, one per floor, CO within 15 feet of sleeping areas. MA requires an inspection certificate at sale. Test each unit, replace batteries, and log the date on a signed checklist for the file.

Federal law covers seven classes; state and local law usually adds source of income, age, marital status, occupation, and immigration status. NY, MA, NJ ban refusal of Section 8 statewide. The list drives the screening criteria, the marketing language, and the application form.

NYC, LA, San Francisco, Berkeley, Oakland, St. Paul, and Portland (OR) have rent control or stabilization. Stabilization status changes the maximum rent, the renewal process, and the eviction grounds available. Confirm with the local rent board before setting asking rent.

Stabilized units require an annual registration with the rent board (NYC DHCR, LA HCIDLA, SF Rent Board). Missing the filing can prevent rent increases and create a refund liability for past collected rent. File before the first lease is signed.

Federal lead-paint disclosure (24 CFR Part 35) applies to any housing built before 1978. The signed disclosure plus the EPA pamphlet must be in the file before lease execution; per-violation HUD/EPA penalties apply for missing disclosures.

For commercial acquisitions and any residential parcel near former industrial use, gas stations, or dry cleaners, a Phase I ESA per ASTM E1527-21 establishes innocent landowner defense under CERCLA. Order before close; recognized environmental conditions may trigger a Phase II.

Issue the EPA-approved disclosure form and the "Protect Your Family from Lead" pamphlet to the prospective tenant before any lease is signed. Capture the signed form in the tenant file — not the property file — and retain for three years past lease end.

Landlord policy (DP-3 for SFR, commercial package for multifamily) with replacement-cost dwelling coverage and at least $1M general liability. Add loss-of-rents coverage for the typical vacancy window. Name the management company as additional insured.

Add a renters-insurance clause requiring at least $100K liability with the management company listed as interested party. Use Lemonade, Sure, or the AppFolio renters insurance integration to verify coverage at move-in and on renewal.

Most states require security deposits to sit in a separate trust or escrow account, not commingled with operating funds. Some (NJ, MA, FL) require interest accrual disclosed annually to the tenant. Set up the account in the property's name and link it to AppFolio or Buildium's trust accounting module.

Set up the property record, GL accounts, and owner profile in AppFolio, Buildium, or Yardi following GAAP-compliant chart of accounts. Distinguish capex vs repair categories now — misclassifying a $4,000 appliance package as a repair creates a year-end tax mess for the owner.

Publish written thresholds: minimum FICO, income at 3x rent, no eviction in the past 5 years, no felony in the past 7. Apply uniformly to every applicant. Vague or inconsistent criteria are the basis for most fair-housing complaints. Source-of-income protections in your jurisdiction may bar a flat "no Section 8" rule.

When a denial is based on a credit or background report, the FCRA requires an adverse action notice with the reporting agency's name, address, and phone, plus a statement that the agency did not make the decision. Template the notice in TransUnion SmartMove or RentPrep so it is automatic, not manual.

Document the state-specific notice ladder: Texas 3-day, California 3-day pay-or-quit and 30/60-day no-cause, Florida 3-day. Identify the landlord-tenant attorney and the housing court for the property's county. Pre-built notice templates avoid the most common dismissal reason — wrong cure period.