Move-out settlement disputes are one of the most common issues in rental management. As property management professionals, we will explain how to correctly read settlement statements and the checkpoints for preventing disputes.
When Does the Move-Out Settlement Statement Arrive? Understanding the Basic Process
A move-out settlement statement (security deposit settlement statement) is a document that shows how much of the security deposit will be returned at move-out. It is prepared by the landlord or management company and normally arrives within one month after move-out. If the lease agreement specifies a return deadline, that deadline will apply.
What Determines Move-Out Costs? Understanding Restoration Guidelines
Move-out costs are determined based on the Ministry of Land, Infrastructure, Transport and Tourism’s “Guidelines for Troubles and Restoration at Move-Out.” The basic principle is that deterioration due to normal aging is the landlord’s responsibility, while damage caused by the tenant’s negligence or intentional acts is the tenant’s responsibility.
However, because this distinction can be difficult to make, disputes are likely to arise. This is an area where even rental management professionals are required to exercise careful judgment.
What Are the Checkpoints for Avoiding Settlement Disputes?
Carefully Review the Breakdown in the Settlement Statement
Once the settlement statement arrives, please check the following.
- Whether the portion attributable to normal aging has been properly deducted
- Whether the amounts for flooring replacement (typically JPY 100,000 to 150,000 for a 6-tatami room) and wallpaper replacement (typically JPY 40,000 to 50,000 for a 6-tatami room) are appropriate
- Whether you are being charged for full replacement costs even though the damage is only partial
- Whether there is inflated billing (charging based on an area larger than the actual size)
Checkpoints During the Move-Out Inspection
- Scratches and stains on floors and walls: normal aging (such as sun fading) is the landlord’s responsibility, while tobacco tar stains are the tenant’s responsibility
- Equipment malfunctions: report any problems promptly to the management company or landlord
- Mold caused by condensation: in most cases, leaving condensation unaddressed is regarded as the tenant’s negligence
Frequently Asked Questions (FAQ)
Q. What should I do if I cannot agree with the settlement amount?
First, ask the landlord or management company to explain the basis for the charges. If the issue still cannot be resolved, consulting a consumer affairs center or filing a small claims action are also options.
Q. What happens to move-out costs if the property had no security deposit?
Even if there is no security deposit, repair costs caused by the tenant’s negligence will still be charged. Because separate settlement will be required at move-out, it is important to keep a photographic record of the property’s condition at move-in.
Q. As a management company, how can we reduce move-out disputes?
Record the property’s condition in detail at move-in and share a checklist with the tenant. The move-out inspection should also be handled carefully, with a commitment to transparent settlement based on the guidelines.
