Hi all, sorry about the wall of text:
I recently purchased an occupied 4-plex with two long term tenants (5 years and 20+ years) and two more recent tenants (1 year and 3 years.)
All leases had expired before the sale and all are on month-to-month.
After the sale was complete I collected one cycle of rent payments to get the previous owner out of the picture and then turned it over to a PM three weeks ago. An early warning sign was two of the four rent checks were late by 5-7 days. I let this go as there were some transition issues with previous ownership.
In the interim I met with 3/4 and asked what needed to be fixed and any concerns they had.
I then sent all 4 a letter stating I was turning it over to the PM for not only management but I stressed in the letter I wanted the PM to begin fixing issues and replacing things neglected by the previous management.
PM delivers welcome packet and asks for SSN, Drivers License and full contact info to prepare new 12 month leases at the same monthly rent.
PM then responds with a letter stating they need DL and full contact info to prepare leases, again, at NO cost increase per month. PM indicates that they NEED this info and failure to provide info for a new lease may result in notice to vacate per local laws.
I'm brand new to real estate investing and I'm trusting my (highly recommended in my area) PM company. They suspect lax lease enforcement by former owners and significant deferred maintenance has created an environment where tenants are used to doing what they want, including late payments.
The next rent cycle is tomorrow, so I should know a bit more depending on if the checks arrive on time.
Is the PM right, should we take a hard line and force the issue, even with long time tenants? I'm thinking yes, this should be standard, but two of them have been there so long they may be used to doing whatever they want and that makes me a bit concerned.
Any thoughts are most appreciated, and again, sorry for the wall of text!
I have a lot less experience than many here do with tenants, but as a supervisor I have seen the same issues. You need to be reasonable but firm. And like you would do with any kid, follow through with any threats or promises. That also means keeping a cool head when annoyed so you don't make any threats you aren't willing to keep. If eviction is what is best, don't wait.
@Peter R. Let them know there is a new sheriff in town. I know it's hard, but business is business. I think your thoughts are in the right place.
If your PM is highly recommended, then you should pass the baton to them and remove yourself from the issue. The PM should know how to maintain crowd control as this is not their first rodeo. Sit back and relax and remove yourself from the frustration. Why micro manage? Food for thought.
@John Moore Well put. The PM company has a system. If they are a reputable company they know what they are doing. I wouldn't interfere.
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