What is the catch with expat tenants?

Question

I have been getting some requests to show our rental to expats. It is usually a relocation agent that seems to be helping the client find a home. In my case, all of the expats seem to be from Japan. I have not verified but that is what the agents are telling me. I find it strange that there are so many expats looking to rent a home in this location, all of them from one country, etc.

Is there anything I need to be aware of? They won't have a credit history in the US or anything I can verify. Have you dealt with such situations?

Is there anything I need to be aware of? They won't have a credit history in the US or anything I can verify. Have you dealt with such situations?

David Gotsill · Answer

One additional thought - this might be seasonal.  Japanese companies operate on a fiscal year April - March.  So, the people looking now may want to be in the US to start the new Japan fiscal year in April.  If you sit on it a bit, you might see a different potential tenant mix, as these people rent elsewhere.

David Gotsill · Answer

I've been on the other side of this - the expat tenant trying to rent.  It's challenging, since as you point out, we don't typically have the customary paperwork/processes for the local market (in my case, I was American renting in Japan).  You can ask for a guarantee from the tenant's company, an increased security deposit, first 2-3 months' rent in advance, etc.  These are aimed to limit your financial risk, especially in light of not having a US credit report.

As to the offer letter - can't say that it "should be" from the US company.  I work for a J-company, and we have wholly-owned subsidiaries in the US.  When we send a Japanese expat to the US, their letter is issued by HQ, a Japanese company.

FWIW, I am a landlord in Japan, and to the extent that broad generalizations help, my tenants (I've held 55 units for the last 5 years) have almost never caused any damage beyond ordinary wear and tear.  I'm also a landlord in Alabama, and I can share pictures of the absolute nonsense some of those tenants have engaged in.  This is all a way of saying that (again, speaking in broad generalizations) my experience has been that Japanese tenants have been relatively problem-free.

Bruce Lynn · Answer

In my experience they are great tenants, normally stay about 3 years, and if you are super lucky their replacement will rent the same home.

Sometimes they'll pay extra to get fridge, washer/dryer and yard/pool service.

Usually very respectful and clean, I've never worried about credit as long as they have offer letter from the company.  Probably have good credit and work history if the company is moving them to US from abroad.

This year some said they had to have a 60 day out clause in case the company moved them mid-rotation.  That was new for me.

Just check as best you can....call HR here in US, check linkedin account, check ID and visa.   There is never a guarantee even with golden tenants, but I would say these are just about as good/golden as you can get.

Bruce Lynn · Answer

What if they are employee #1 in the US?   Can you find FB info, Linkedin info or anything like that.  You could still ask for bank account info, even if it is in Japanese, employee ID, passport info, visa info, information about where they live in Japan, pay stub, etc, you might also google their name and company info and see what comes up.   The ones I have dealt with from Japan are normally very organized though and will get what you ask for.   Japan is a little different, but for many countries the applicant can print for example their bank account info in English or maybe a dozen other languages.

You are correct that most day 1 will not have SSN, that might be 1-2 months after they get here....same with DL, they'll get bank account once they get those things.  May never have a credit report here.

You could ask the agent that is working with them if they have US office yet, go drive by it and see if anyone is there.  Is there a name on the door, on the sign board in the lobby, etc.

Since they don't have any info, you could ask for double deposit if that is legal where you are...or ask for some rent up front, if that makes you feel more comfortable....or if they just can't provide any info, then turn them down.

Pal Sa · Answer

Thank you for your response. I am checking as much as possible.

For the current applicant, there is no SSN, no driver's license number, no US bank information, no US address for the office. All I have is their passport number and offer letter that has no references to the US office or US HR or anything. Shouldn't they be receiving an offer letter from the US office if they are going to work in the US?

What is the catch with expat tenants?

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