Do you disclose yourself as the owner when showing a rental?

General Landlording & Rental Properties
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Do you disclose yourself as the owner when showing a rental?

Scott Voytko
Rental Property Investor · Clermont, FL · Member since 2012 · 34 posts · 13 votes

I've heard mixed answers, including in podcast 60 where they say they are not the owner, but the manager, of a rental property they own.

It is my understanding that if you are a licensed realtor(at least in Florida), and own the property, you must disclose that you have a financial interest in the property to any potential renter (and of course, buyer). What do you do? And how do you disclose it?

My first instinct is to disclose it in the lease, but portray myself as the manager. Just curious how everyone else handles it.

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Chris Adams
Contractor · Valparaiso , IN · Member since 2013 · 604 posts · 327 votes
12y

I have no reason to hide the fact that I am the owner, and I can think of quite a few benefits of telling them I am.

First and foremost the tenant will understand that as the owner what I say carries credibility. Unlike dealing with a PM who runs numerous different properties and may not be able to give them specific answer.

If your starting off a relationship with a new tenant by hiding your identity, then how can you expect your tenants to be truthful towards you.

Hiding my identity would be chicken **** imho. If someone doesn't want to disclose this information, then maybe they shouldn'y be showing their properties and should put systems in place to remove themselves from being that involved in the daily PM.

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  • Rhett TullisBusiness Member
    Property Manager · Oklahoma City, OK · Member since 2013 · 1k+ posts · 617 votes
    12y

    Here in Oklahoma as a Broker I have to disclose it.

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    0Reply
  • Jonathan Pliszka
    Financial Advisor · Lexington, KY · Member since 2012 · 150 posts · 66 votes
    12y

    I've gone back on forth on this. I originally started saying that I was the "manager" but then switched to saying that I was the "owner." I work as a part-time broker and occasionally work rental leads for my managing broker. This may be Chicago specific, but I found that tenants were consistently quick to gripe about large property management companies and their bad experiences with them. I use this to my advantage in my listings by saying something like "Tired of dealing with a large property management company? This building is cared for by the owner." The potential tenants who value that statement are the kind of people I want to rent to. Again, may not work in your market because their may be less of a presence of large multi-family buildings, but just my two cents. Good luck!

    0Reply
  • Dawn AnastasiPro Member
    Rental Property Investor · Milwaukee, WI · Member since 2013 · 6k+ posts · 4k+ votes
    12y

    Brandon Turner and Ben Leybovich had two blog articles on the topic, opposing viewpoints:

    Brandon Turner - Is it a Lie to Tell Tenants I'm not the Owner?

    Ben Leybovich - Counterpoint

    Podcast Guest on Show #29
    0Reply
  • Arthur Banks
    Real Estate Investor · Waukegan, IL · Member since 2013 · 367 posts · 80 votes
    12y

    I'm interested in hearing what others are saying today on this often discussed topic. Rather than have anyone ask if I'm the owner, I think I would introduce myself as the manager upfront. "Hi, welcome. My name is Arthur, I'm the manager..." This way I won't be put in the position to have to disclose. If they ask directly, then I would be honest. JBH.

    0Reply
  • Brie SchmidtBusiness Member
    Moderator
    Real Estate Broker · Chicago, IL · Member since 2013 · 6k+ posts · 5k+ votes
    12y

    I agree with @Jonathan Pliszka - Maybe it is Chicago specific but I find a lot of people who will not even consider large management companies because they are so badly run here. I know when I was a tenant I would not consider the big apt complexes.

    In IL we have to include in advertisements that the owner is a licensed broker and when I meet with tenants I always say I am the owner and that our buildings are managed by us.

    Podcast Guest on Show #132
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  • Rolanda Eldridge
    Investor/Realtor · Hoover, AL · Member since 2010 · 1k+ posts · 459 votes
    12y

    @Scott Voytko ...I introduce myself as the owner. I'm professional in every aspect, but prefer to start out on the right track. It's difficult not to let human sided creep in. When tenant financial issues arise I try to help them resolve. More than 95% pay on time with few issues, but that 5% need a little TLC. I'm in a position to deal with the 5% more effectively. When I started out the 5% "freaked" me out because I needed every $$$....with continued growth and compassion I'm enjoying the journey!!!

    2Reply
  • Chris Adams
    Contractor · Valparaiso , IN · Member since 2013 · 604 posts · 327 votes
    12y

    I have no reason to hide the fact that I am the owner, and I can think of quite a few benefits of telling them I am.

    First and foremost the tenant will understand that as the owner what I say carries credibility. Unlike dealing with a PM who runs numerous different properties and may not be able to give them specific answer.

    If your starting off a relationship with a new tenant by hiding your identity, then how can you expect your tenants to be truthful towards you.

    Hiding my identity would be chicken **** imho. If someone doesn't want to disclose this information, then maybe they shouldn'y be showing their properties and should put systems in place to remove themselves from being that involved in the daily PM.

    7Reply
  • Richard C.
    Bedford, NH · Member since 2012 · 2k+ posts · 1k+ votes
    12y

    I love the, "I'm not really lying, the building is owned by my LLC, not by me" line. And by "Love" I mean "Hate."

    Ask yourself this. If you were qualifying a tenant, and they said, "I'm not self-employed, see here are my pay stubs from XYZ, LLC!" What would your reaction be if you later found out that the tenant is the sole owner of XYZ, LLC?

    Be a grownup, deal with people honestly and with respect, and expect and demand the same in return.

    6Reply
  • Michael B.
    Apopka, FL · Member since 2012 · 207 posts · 120 votes
    12y

    Here's what it comes down to for me:

    I expect the tenant to be completely truthful with me. So, I'm going to start a multi-year relationship with someone who I expect to tell me the truth by playing word games? Very bad idea.

    There may be an acceptable fig-leaf of not actually lying when you say you're not the owner but your LLC is. But it's still deception since you're trying to get the tenant to arrive at an incorrect conclusion.

    If you expect a tenant to be truthful with you then you need to return that courtesy. Deceiving with word games is a really bad idea that will bite you in the future. Way too much risk for such a piddly gain.

    2Reply
  • Arthur Banks
    Real Estate Investor · Waukegan, IL · Member since 2013 · 367 posts · 80 votes
    12y

    On second thought... there's this really fancy building here in Chicago that has the name TRUMP all over the place. I guess there is no hiding who the owner is. In fact the owner seems to WANT you to know who the owner is. If it works for him... :)

    0Reply
  • George P.
    Property Manager · Livonia, MI · Member since 2011 · 4k+ posts · 1k+ votes
    12y

    after awhile they seem to figure it out.

    0Reply
  • John Rooster
    Denver, CO · Member since 2013 · 409 posts · 105 votes
    12y

    Of course I tell them I am the owner. It would be deceptive to tell them otherwise. As best as I can tell, the only benefit to not telling a tenant you are the owner is if you are wishy washy and afraid of confrontation. I have no problem telling a tenant to go to he!!

    0Reply
  • Account Closed
    Investor · Central Valley, CA · Member since 2012 · 6k+ posts · 3k+ votes
    12y

    Five years ago I met my daughter's first landlords in Berkeley, a professional couple, out front one day. They introduced themselves and I asked how their foray into landlording was going, as I knew that they had bought it a year ago. They said, oh it's not ours, we just manage it. I said Really, then why did you buy it in your names and why did you borrow $500K in your names?

    The internet changes everything. You can put your property in an LLC and you can have your service agent be an LLC in another state but if someone wants to find out who owns it, they will.

    A problem tenant will bother a manager just as much as the owner. Anybody who is sue happy will do so, whether you are the owner or not. If you are asked point blank and you lie, then you can't really expect transparency on the part of the tenant applicant.

    2Reply
  • Deborah BurianPro Member
    Rental Property Investor · Oklahoma City, OK · Member since 2013 · 1k+ posts · 412 votes
    12y

    I tell tenants I am the owner and I have no issues with that from a privacy standpoint. I do have mental struggle with the literal accuracy of that since all props are held in an LLC and the whole point of an LLC is to separate business risk from ones personal assets. If I say I'm the owner, am I claiming its a personal asset? The whole thing gives me a conceptual headache... Technically I am a member of the LLC but I sure feel like the owner!

    0Reply
  • James Wise
    Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 31k+ posts · 20k+ votes
    12y

    If your the owner just tell them your the owner.

    Some want to say they are the manager so they don't have to be the bad guy. In this business sometimes your going to have to be the bad guy.

    0Reply
  • Account Closed
    Investor · Central Valley, CA · Member since 2012 · 6k+ posts · 3k+ votes
    12y
    Originally posted by @Deborah Burian:
    I tell tenants I am the owner and I have no issues with that from a privacy standpoint. I do have mental struggle with the literal accuracy of that since all props are held in an LLC and the whole point of an LLC is to separate business risk from ones personal assets. If I say I'm the owner, am I claiming its a personal asset? The whole thing gives me a conceptual headache... Technically I am a member of the LLC but I sure feel like the owner!

    A properly set-up LLC limits your liability and you already did that. So give your brain a rest and struggle no more. If you are ever sued, let the plaintiff's attorney figure out the asset situation. That's the what the the plaintiff is paying them for. :)

    0Reply
  • Elizabeth Colegrove
    Hanford, CA · Member since 2013 · 5k+ posts · 1k+ votes
    12y

    @Scott Voytko

    I disclose exactly my position.

    1Reply
  • Tim Davids
    Real Estate Broker · NW Indiana · Member since 2014 · 99 posts · 30 votes
    12y
    Originally posted by @Arthur Banks:
    On second thought... there's this really fancy building here in Chicago that has the name TRUMP all over the place. I guess there is no hiding who the owner is. In fact the owner seems to WANT you to know who the owner is. If it works for him... :)

    Your better . I've seen tons of building with "Bank" on the front :) I know it's Banks. ;)

    0Reply
  • Dominick Adolfo
    Chicago, IL · Member since 2014 · 28 posts · 10 votes
    12y

    I treat people the way I want to be treated. I have no problem telling them up front.

    1Reply
  • Kimberly T.
    Investor · Colorado Springs CO · Member since 2014 · 535 posts · 253 votes
    12y

    We (husband and I) tell them we are the owners. For our local triplex, we even have them come to our house to sign the rental agreement, and tell them rent is due at our house. That way they can't deny knowing where to pay rent!

    For our out of state (AZ) fourplexes, we introduce ourselves as the owners, but we haven't given out our address or phone number. Of course, they could look up our address online if they wanted to. But we want them contacting our PM for rent, repairs, etc.

    I read an interesting story once about a couple who owned a complex. The wife portrayed herself as the owner - stickler about late fees, abiding by the rental agreements, etc. Strict. The husband, though, would always show up to do repairs, maintenance, etc., so tenants got the impression he was just a handyman who worked for the female owner (they never asked him if he was an owner too). Tenants would then tell him all kinds of stuff about the "mean old landlady" not realizing it was his wife! Maybe a good way to go about getting the inside scoop from your tenants!

    0Reply
  • Arthur Banks
    Real Estate Investor · Waukegan, IL · Member since 2013 · 367 posts · 80 votes
    12y
    Originally posted by @Tim Davids:
    Originally posted by @Arthur Banks:
    On second thought... there's this really fancy building here in Chicago that has the name TRUMP all over the place. I guess there is no hiding who the owner is. In fact the owner seems to WANT you to know who the owner is. If it works for him... :)

    Your better . I've seen tons of building with "Bank" on the front :) I know it's Banks. ;)

    Hahaha! Nice!

    0Reply
  • Account Closed
    Investor · Evanston, IL · Member since 2014 · 14 posts · 6 votes
    12y

    I was listening to another attorney here in Chicago, who specializes in landlord/tenant law, talking about how often landlords want to remain anonymous, or appear as "managers" to their tenants - he didn't get it at all! In fact, he said that sometimes when landlords are more upfront, they get better results from their tenants. Not sure if I agree, but not sure if I don't!

    0Reply
  • Craig SmithPro Member
    Investor · Hixson, TN · Member since 2014 · 25 posts · 6 votes
    12y

    I don't understand the downside to telling them I am the owner. Can someone who prefers not to do this explain what benefit is gained?

    0Reply
  • J. MartinPro Member
    Rental Property Investor · Oakland, CA · Member since 2011 · 3k+ posts · 2k+ votes
    12y

    I agree with @Elizabeth Colegrove

    0Reply
  • Larry K.
    Investor and Architect · Ramsey, NJ · Member since 2010 · 305 posts · 84 votes
    12y

    I have found they rarely ask. If they asked I would answer truthfully. The upside is they know they are dealing with the decision maker.

    0Reply
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