Private landlord here!

J

jbh

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I've been a landlord for about 17 years. I rarely, if ever, raise the rent on the property. My (former) real estate agent presented several renters 10 months ago. Some had poor credit ("I just have a foreclosure" and it turns out that they've decimated ever bit of their credit and are still eating out at Scotts) and offered more than market rent and I still turned them down. Others had timing issues.

Our agent presented a guy with one big ding on his credit (a looming foreclosure), along with a few other "questions". When I asked for more clarification (i.e. His stated income was much higher than his paycheck stub represented), she got a verbal confirmation from his "supervisor" and ok'd him in writing before I could ask anything else. I was angry, but took him on as a tenant along with the ensuing risk.

I just poured $5,000 into the place in '08, and the place looks really nice. The property upstairs has not been well cared for, and just rented for $100 less than my property. It's only 10 months into the lease, and my tenant is now applying strong pressure for me to lower his rent or he'll "consider his options". When I reply that the unit upstairs is not in as good of condition, he becomes angry and wants my "final number" for his new lease rate. Thoughts?

 
He does not seem like a very good person. I would not let him strong arm you. He is not your ideal tenant to begin with. I say hold firm on price.
 
As a fellow landlord, I would remain firm as well.  Do not let tenants strong arm you because the rental market in OC has stabilized in the past year or so.
 
If he is a good tenant, I would work with him. 

Does he pay on time or early?  Is he doing the little things himself and keeping it clean, or calling when the toilet runs?

But it sounds as if you don't like him much personally, so maybe you should just stand firm and hope for a better tenant next time.
 
Thank you for you replies. Right after he moved in, he wanted some upgraded window coverings, which I decided to put in a few weeks later for him. I just wrote a check for several thousand for a new heater pump for the condo, so the timing is bad as well.

I think that a private tenant-landlord relationship is based more on "trust" than say, an IAC-tenant relationship. When I work hard to make a tenant happy, and the reply is "lower my rent or else" two months before the lease ends, I wonder what's next. I don't think that I want to sign a new lease with this guy, and put myself in a position where I'm stuck with him if his demands increase. Right now, I'm just trying to keep myself from writing a note explaining that rent prices are influenced not only by the quality of the property, but the quality of the tenant :)
 
Out of curiosity, why did you turn down the foreclosure person who was ready to pay more than market?  I imagine a lot of these folks have to turn to private landlords as IAC will not touch them with a 10-foot pole.

My father-in-law rented his house in Orange to a family with horrible credit but they prepaid 6 months rent on a 12 month lease.  I imagine this foreclosure person looking at your property probably is sitting on a decent amount of cash if they squatted in their previous place for a while. 
 
I would have taken the foreclosure tenant if that was the only ding, since there is a lot of that going on. But they had let every item on their credit report lapse, except for their car payment. Even the small debts were way behind. I wasn't willing to risk a long eviction process.
 
My wife and I met our tenants at our first SFR investment property for the first time since the home was built in 2006 and they have never missed their $3000 rent for the 4 years they have been tenants. I know this is extreme luck or blessing from God for a first time land lord. To our suprise the home was kept in incredible shape (better than how my wife and I would have kept it living there for 4 years) where the tenants painted the exterior and interior, added a sprinkler system, beautiful landscaping, and fences from their own pocket. What is odd is that the tenant is my dad's age (born in 1946), a strong devout christian, and reminds me a lot about my dad as loves to talk about all the businesses he started during is life time and passionate about his work. We just moved to the Atlanta area 10 days ago and don't really have any friends or family in the area, but my tenants wanted to take us out for dinner next weekend and seemed to be interested in getting to know us. Is it okay to become friends with your tenants? I can really see my wife and I clicking with this couple, but i am sure if it is appropriate in a landlord/tenant relationship.

They initially planned to relocate to Georgia from Texas for only 1 year, but got extended as my tenant started to see success expanding his business in Atlanta. Gosh, I hope they continue to my tenants for another 4 years.  :D
 
Panda said:
My wife and I met our tenants at our first SFR investment property for the first time since the home was built in 2006 and they have never missed their $3000 rent for the 4 years they have been tenants. I know this is extreme luck or blessing from God for a first time land lord. To our suprise the home was kept in incredible shape (better than how my wife and I would have kept it living there for 4 years) where the tenants painted the exterior and interior, added a sprinkler system, beautiful landscaping, and fences from their own pocket. What is odd is that the tenant is my dad's age (born in 1946), a strong devout christian, and reminds me a lot about my dad as loves to talk about all the businesses he started during is life time and passionate about his work. We just moved to the Atlanta area 10 days ago and don't really have any friends or family in the area, but my tenants wanted to take us out for dinner next weekend and seemed to be interested in getting to know us. Is it okay to become friends with your tenants? I can really see my wife and I clicking with this couple, but i am sure if it is appropriate in a landlord/tenant relationship.

They initially planned to relocate to Georgia from Texas for only 1 year, but got extended as my tenant started to see success expanding his business in Atlanta. Gosh, I hope they continue to my tenants for another 4 years.  :D
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Like I tell anyone who is interested in being a landlord and buying rental properties...good tenants are worth their weight in gold!
 
Its good to be friendly with your tenant (or landlord if the roles are reversed).  But it isn't good to be friends.  It is a business relationship, afterall.

I would skip the dinner, but send them flowers or something, thanking them for being such great tenants.

 
If I were a tenant of a private rental, I wouldn't expect a reduction if a nearby unit was cheaper by only $100.

Sounds like you should let him walk and look for a new tenant.

The problem you may face now if you do end his lease would probably getting some cooperation in showing your unit to future tenants. He may do what I saw when we were looking for rentals and throw clothes all over the place to make it look less desirable.  ::)
 
Panda said:
My wife and I met our tenants at our first SFR investment property for the first time since the home was built in 2006 and they have never missed their $3000 rent for the 4 years they have been tenants. I know this is extreme luck or blessing from God for a first time land lord. To our suprise the home was kept in incredible shape (better than how my wife and I would have kept it living there for 4 years) where the tenants painted the exterior and interior, added a sprinkler system, beautiful landscaping, and fences from their own pocket. What is odd is that the tenant is my dad's age (born in 1946), a strong devout christian, and reminds me a lot about my dad as loves to talk about all the businesses he started during is life time and passionate about his work. We just moved to the Atlanta area 10 days ago and don't really have any friends or family in the area, but my tenants wanted to take us out for dinner next weekend and seemed to be interested in getting to know us. Is it okay to become friends with your tenants? I can really see my wife and I clicking with this couple, but i am sure if it is appropriate in a landlord/tenant relationship.

They initially planned to relocate to Georgia from Texas for only 1 year, but got extended as my tenant started to see success expanding his business in Atlanta. Gosh, I hope they continue to my tenants for another 4 years.  :D
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Observing what my brother and friends went through went their tenants, I recommend skipping the friendship and maintaining a nice but professional relationship.  While everything is great now, things can go bad and its much harder to deal with friends regarding financial matters. 

On another note, how much does your house cost now?  $3000 rent in Atlanta seems high and would like to understand what kind of properties these are.  I looked at some properties near my uncles house in Lawrenceville and they were around $250K and would rent for about $1500 so cashflow positive with todays rates but not enough when you factor in property management and hassles of being 1000s of miles away from the property. 
 
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