Should You Let Tenants Work on a House In Exchange for Rent Credit?

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A few weeks ago, I was showing one of my units to a series of prospective tenants. One of the potential tenant applications asked, “Do you like the carpet?”

I looked at it. It was brand-new carpet, installed only a few weeks prior. It was a neutral color. It was, in short, the least-offensive, least-objectionable carpet that I could imagine.

“What do you mean?,” I asked.

“Well, I’ve done some contracting work,” he replied, “and I could install hardwoods in exchange for a rent credit … ”

Oh no. No, no, no.

I’ve never allowed a tenant to do any type of repair, maintenance or upgrade work in exchange for a rent credit. That’s not due to a lack of offers. That’s due to my assumption that allowing a tenant to work on the house is a potential recipe for disaster.

I’ve never heard any stories of that type of arrangement — working on a house in exchange for rental credit — going well. (In fact, I welcome those stories … if you’ve done this, and it’s worked out for you, please tell me about it in the comments below).

But I have heard plenty of stories about work-for-rental-credits going badly. Here are a few of the stories that stand out in my mind:

#1: The OverPriced Paint Job

I know a landlord in the Boston area who agreed to let his tenant re-paint the interior of their condo in exchange for one months’ rent. The landlord didn’t stop to crunch the numbers before agreeing to this arrangement. Later he realized that he’d effectively “paid” (in the form of lost income) more than $1200 to paint a very small space, only a few hundred square feet. The landlord, in other words, egregiously overpaid for the service.

And he got off lucky. Imagine what would have happened if the tenant did a terrible job — one that would need to be immediately re-done — AND THEN insisted on getting a rental credit for it?

#2: The Unstated Upsell

I know another landlord in the Denver-Boulder area who agreed to let his tenant do landscaping/gardening work in exchange for a rental credit. They negotiated an hourly rate for the labor, and the landlord agreed to compensate for the raw materials with a receipt.

You can imagine how this story went: the landlord ended up paying far more for raw materials, and for a far higher number of hours, than he had anticipated. The tenant did good work and created a fantastic-looking space, but the improvement went far beyond what the landlord had expected. The landlord, in other words, got “upsold” without knowing it.

And again, he got off lucky —  the strong quality of the work mirrored the cost. Imagine what would have happened if the tenant over-inflated his hours, or did a terrible job?


Those are the two stories I’ve heard, but I’m betting there are more. If you’ve ever agreed to let a tenant do work in exchange for a rental credit, share your story below. I’m sure there are more horror stories, and (potentially) there might be some good examples, too.

But one thing is certain: I’m never going to allow this arrangement in any of my rentals. I’d rather keep the landlord-tenant relationship as simple and clean as possible.

Photo: cncphotos

About Author

Paula Pant

Paula Pant quit her 9-to-5 job, invested in 7 rental units, and traveled to 32 countries. Her blog, Afford Anything, shares how to shatter limits, build wealth and maximize life. (At, she shares EXACT numbers from all her rental investments -- costs, cash flow, cap rate; it's all published for the world to read.) Afford Anything is a gathering spot for a tribe dedicated to ditching the cubicle. Read her blog, and join the revolution.


  1. My brother recently showed a house to someone who claimed to be a contractor and said he would be interested in moving in and could help with repairs. He offered to paint and replace flooring, among other things. He stopped showing up for the work, did a terrible job painting the house (it looked like he painted the walls first, badly, but left the corners/edges unpainted), and tore up the old flooring without putting anything new in its place. Now, he says he doesn’t want to rent their place anymore.

    So, they will have to repaint the entire house, most of which didn’t need it previously, and repair the floor.

    Some of my tenants asked to paint recently. They even presented color swatches to the manager. The colors were dark blues, oranges, etc. I just said No.

  2. Paula: You made a great point with your stories – success or failure is created up front, as in any deal!

    YES! We’ve had tons of amazing work done on our properties by tenants. However, we make sure we’re in charge. For example, maybe a property needs work before they move in and they say they can do it, so we let them move in for a lower move-in fee. This might mean the house hasn’t been cleaned out (yes, we’ve had tenants view a property before we even cleaned out what was left by the former tenant or owner) and they said they’d do the work. Great! No money out of our pocket or time and effort on our part so they pay less to move in! And, they can paint if they want or not, their choice, but we don’t have to do it. We often take less move in money when a house needs painting or has odd colors. Turns out, most people want their own colors anyway and they’re thrilled to know they can not only paint, but because they pay less to move in, they can use that money toward paint!

    We’ve had people ask if they could take out carpet and put in hardwoods. Yes. But, we are part of the process sending our guys to give bids and check on their work to see if it is done “well” or, depending on the size of the job, to code. We have had not only hardwoods installed (at little or no charge to us) but tile floors in bathrooms and kitchens. Again, we allow this in “their” home only when we are a part of the overseeing process to “protect” them and the work being done in “their” home. Most times, they simply want to upgrade where they are living and a rent reduction doesn’t even come into play. People stay longer when they can make it feel like their home so it becomes a win/win/win.

    Moral of the story, maintain control and you can get some GREAT work done on your properties with far less out of pocket than it would take to do it yourself. Many people truly love doing the work so I say, “Go For It!”

    Thanks, Paula, for your post!

    • I’m with Karen on this.
      I have let some residents do some upgrades or minor fixes or paint a room if they want to do it themselves. Sometimes I will pay for the material (Mostly if it is a minor repair vs. something they desire) but not always.
      I’d NEVER let them do anything significant and I would never pay them to do anything.
      The closest I came to that was recently there was a bum wall mounted AC in a condo rental I own. I bought a new one and had it delivered but they do not install them. Instead of waiting for me to get a guy out there to put it in the tenant said he could so I said okay and just arranged for the haul away of the old unit.
      I sent them a $10 rent coupon that I had made up for little gifts at the holidays and such with a thank you letter. Good hourly rate for him but still way cheaper than the minimum service call fee for anyone I could have gotten out there.

  3. Robert Watkins on

    Paula thank you for your post it comes at the perfect time for me. I’m ready to rent a room in my home to a handyman friend of a friend who is selling his home.

    Karen.. Your response is fantastic, THANK YOU both this helped me greatly on my decision moving forward…

  4. In addition to all the horror stories listed, one that could potentially worse would be if a tentant
    got injured (real or fake) and filed a workers comp claim. Some courts may judge that doing the work is the same as a paid employee or worker, not worth the risk for any amount of money.

  5. A technique that I have seen worked – is to disclose all the details in the rental agreement and verbally express it to the tenants.

    For example, a clause stating “all repairs are the responsibility of the tenants” and add penalty “3-strike clauses” for repairs/maintenance that takes work responsibility away from the tenant if the work is deemed unsatisfactory.

    In addition to the “3-strike clauses”, the repairs/maintenance cost is added to the rent each month. Disclose examples of some of the costs in the rental agreement, such as $50 additional per month for pool maintenance and $50 additional per month for gardening.


    • Hmm — I do have a clause in the lease stating that the tenant is responsible for maintenance (e.g. yard care), and if they don’t do it, then I’ll hire a company and bill them. (That’s for my SFR’s, of course. On a multiplex its different).

      I also have a clause stating that the tenant is responsible for the first $25 of every repair call. I don’t enforce it unless I think they’re making frivolous calls.

  6. How about on a lease purchase? It seemed like a good idea at the time, I supply 10 new double pane vinyl windows and the tenant buyer a window and siding guy installs them for a partial rent credit? You would think this is a win win the tenant buyer gets all new windows in the house he has a chance to buy in 12 months.

    I notice the windows in the front of the house looked great, then about a month later they look different. I find out the tenant sold the windows I provided trading his customers older versions for my new windows. He assured me he was still happy to buy the place with the older windows.

    Of course this story would have been long forgotten if this tenant had actually purchased the property. My hvac office is just across the street, I thought if kind of funny when I saw a competitor van out front and one of his technicians going up the stairs on a Saturday.
    As a tenant I would have figured the landlord would have received the first call about the heat not working.

    Before this fellow got to the front door I hailed him to ask what was up. He replied that the owner of the house was trying to sell the new gas boiler and water heater. It seems my tenant had a for sale advertisement in the Craigslist for all of the mechanicals in the house.

    Lucky for me, he had not sold anything other then the windows. He had however moved out of the property while having the sale. A call to the police sent him on his way, never to come back.

    Needless to say the worst contractors you could possibly hire for any job would be any tenant in residence in any of your properties.

    • That’s one of the worst horror stories I’ve ever heard — a tenant selling off all the mechanicals in the house!! Holy moly!! I never even imagined that a tenant would do something like that … but geez, you get all kinds ….

  7. Yea, had tenents wanting to move in early, they agreed to finish painting 2 bedrooms in exchange for early move in cost. Well 3 months later, the rooms where never painted and they in fact stopped paying the rent too, had to evict them & still had to paint too. So with that, NEVER AGAIN…

  8. Robert Steele on

    Have to agree with the author – no no no.

    I have allowed tenants to repaint a room on occasion. No rent credit. Baby blue for a new nursery for instance. I get to approve the color and I make it clear in writing that if they do a bad job and I have to come in and fix it up they will be paying for it. I have not had to enforce that. I’d probably end up taking it out of the deposit if I did.

    I have had another tenant that wanted to install a fish pond in the back yard. I regretfully said yes but put it in writing that I could ask them to remove it when they moved out. If not, again -security deposit.

    I am not sure about the wisdom of all this. I try to make my tenants happy but I get the feeling this is going to bite me one day.

  9. I couldn’t agree with you more. That is a recipe for disaster. Renters are not contractors and the relationship should stay that way. If I’m making money off someone, I wouldn’t want anything (no matter how little) to become between that.

  10. I have always rented homes, never believed in buying one until I married, yet my talents and handy work always get me home work. can you fix this or wouldn’t this look nice. I ‘ve done everything from landscaping to roofing. My bigest issue is when it’s time to move on I am owed big from my landlords and I take a loss each time. I do understand that it’s tough to let someone else work on you property and there are not many of us who don’t take that plunge into home ownership but were out there and a good handyman can really and value to your home.

  11. My husband and I lived in two rental properties in return for either no rent or reduced rent. The first property was a house that literally had holes in the floors and had been vandalized after being abandoned by the owners. We were to live in it rent free for one year, they would pay for the flooring but we would install it; we would pay for all other materials (sheetrock, paint, etc.) and provide the labor. After four months, they came by the house and saw all the work we had done, the wife immediately told us that they had decided to sell the house and we had until the end of the next month to get out. That would have given us just a total of 5 months in the house. We essentially paid $4,200/month for rent. The next house we learned our lesson. We paid half of the monthly amount the owner usually got for rent. She paid for ALL materials and we provided ALL labor. We also had a lease that guaranteed us one year in the house. When the year was up, she told us she was selling the house. She sent a real estate agent over and the next day it was sold. We had two weeks to move. Speaks for our work but it’s a royal pain to try to find a place to live AND move in two weeks. The owners aren’t always the ones who get the short end of the stick.

  12. I rent my house to a young couple, and the wife’s father is a contractor. Each month we negotiate the exact job to be done and the price. Either I agree or I don’t. I come to inspect the work or they send me pictures as soon as it’s done. I started with a list of everything that needed to be done, and I allow them to choose the job that month according to what’s most conducive to comfortable living (i.e. we decided to do the bathroom heater this month because it’s cold now, last month it was the front door for security reasons). I send her an email confirming the price and the exact work to be done for that price and she has to acknowledge it before they can begin. I’m actually having pretty good luck with this system.

  13. Max T.

    I agree with the author! The closest thing I did to this was once when I was in a time crunch to turn around a unit I had lived in to new tenants while at the same time renovating my new place. In order to get it done on time for the newbies I asked them to help me do touch up paint and clean for two days. I deducted from their first month’s rent at the same rate I pay my day laborers. It worked out great and I really got to educate them about my former home in the process.

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