Security alarm system...to pay or leave to the tenant

Security alarm system...to pay or leave to the tenant

Baltimore, MD · Member since 2014 · 3 posts · 1 vote

I've moved into my first property, a duplex, and in two days my first tenants will be moving in! The duplex has a security system in both units which is currently activated until the end of the year. This expense was rolled into my mortgage. After reading forum post about how to deal with security systems, I emailed the tenants and told them after Dec 31 if they want to keep the alarm system activated the account must be placed in their name and they are responsible for paying the monthly service fee to the company. This did not go over well - they said this is the first time they are hearing about this and they were under the impression that it was part of the rent. Admittedly they had not heard about it before because I just learned from the company that the contract ends Dec 31. But I never stated I would cover cost for the alarm, and my lease states "Tenant will pay all utilities charges, except for the following, which will be paid by Landlord: Water/Sanitation".

I can imagine that taking on the security system as my responsibility could be a headache down the road. I'm holding my ground that if they want it beyond Dec 31 it will be their responsibility to set the account in their name and cover the fee. They are already getting complimentary service for 5 months. Am I justified in taking this position? 

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  • Mechanicsville, VA · Member since 2014 · 40 posts · 6 votes
    12y

    I don't really have an answer because I am not investing just yet I'm still trying to build my fundamental education; but I plan on getting a multifamily unit and living in one part and renting out the other part. Could we perhaps connect and you tell me more about how you prepared yourself to take this on? like what books did you read? how specifically did you do it from the loan etc...? I hope to hear from you soon @Carmen Washington.

  • Property Manager · Livonia, MI · Member since 2011 · 4k+ posts · 1k+ votes
    12y
    Originally posted by @Carmen Washington:

    I've moved into my first property, a duplex, and in two days my first tenants will be moving in! The duplex has a security system in both units which is currently activated until the end of the year. This expense was rolled into my mortgage. After reading forum post about how to deal with security systems, I emailed the tenants and told them after Dec 31 if they want to keep the alarm system activated the account must be placed in their name and they are responsible for paying the monthly service fee to the company. This did not go over well - they said this is the first time they are hearing about this and they were under the impression that it was part of the rent. Admittedly they had not heard about it before because I just learned from the company that the contract ends Dec 31. But I never stated I would cover cost for the alarm, and my lease states "Tenant will pay all utilities charges, except for the following, which will be paid by Landlord: Water/Sanitation".

    I can imagine that taking on the security system as my responsibility could be a headache down the road. I'm holding my ground that if they want it beyond Dec 31 it will be their responsibility to set the account in their name and cover the fee. They are already getting complimentary service for 5 months. Am I justified in taking this position? 

     that's why the first thing i do when i purchase a house is rip the alarm off and disconnect the sprinkler system. they are nothing but a pain when they go bad and alarm system gives the potential tenants an impression that the area is bad. and why would you want that? 

    they can complain all they want, the contract will not be renewed and that's that. whatever says in the lease that's what is covered. NOONE will move out because their alarm system contract is no longer covered. it costs more to get a moving truck than a monthly contract.

  • Investor · Western Montana · Member since 2014 · 110 posts · 36 votes
    12y

    @Carmen Washington I do have a few questions.

    First is the alarm system actually two different systems. Meaning are they wired for each unit and only for each unit. I assume they are but then there is also the question of can each alarm unit be billed out individually?

    If each system is separate from the other AND it can be billed individually (also call the alarm company to see if there is any headache about switching the names to tenants then back again to you when they move out), then I say if the tenants want to have an alarm, they pay. You could politely remind them that like you said in your contract all utilities with the exception of water/sanitation are to be payed for by the tenant.

    Let us know which route you choose and what happened!

  • Investor · Middletown, NJ · Member since 2008 · 2k+ posts · 1k+ votes
    12y

    Alarm systems can be tricky. We had a tenant that we allowed to install one (and pay all expenses herself) because someone tried to break the lock on her front door when she wasn't home. She gave us a copy of the police report. As she was a single mother, we agreed to this as long as she gave us, and our contractor, the code. She did. But as time went by, she had to dis-arm the alarm remotely when the contractor was scheduled to come over if she was at work, and of course, forgot to do that once or twice and he couldn't get in.

    When she moved, we removed the alarm panel that she had left behind, and that was that.

    An SFR that we own had the pipes stolen while it was vacant, a week before the new tenants were to move in. We had to postpone their move-in by 2 weeks and told them why. To dissuade them from deciding not to take the property, we installed an alarm system at our expense and told them we'd pay for it for the first 6 months. If they decided to keep the system active, they would have to pay for the monitoring service after that. Otherwise, they could keep the existing alarm in place and there would be no formal monitoring, just an alarm that would go off if there was a break-in. They decided to continue paying for the monitoring, again with the requirement that they do not change the code. It costs about $25 a month. We own the equipment.

    Over time, a tenant could decide the cost of moving is more appealing than paying for an alarm system that they assumed was included. What you might do is keep paying for the service until their lease expires, to keep a goodwill relationship, and let them know the new lease will not include the service without a rent increase to cover it.

  • Investor · McKinney, TX · Member since 2012 · 588 posts · 224 votes
    12y

    Most systems will have a master code, then you can create many additional codes.  If I had an alarm in a rental, I'd keep the master code to myself, then create a code for the tenant, and maybe have a spare one as well that you keep to yourself.

    I do not have one but I keep thinking about getting simplisafe.  Its an alarm system you can move from house to house and it uses cellular services.  You can also disable remotely through the web.  I think it would be good for vacant houses or houses you are rehabbing.

    As far as paying for it, if you misled (even accidently) them into thinking it was covered, I'd offer to cover some of the costs.  Around here, you can get monitoring for $14 month.  You could split that.  

    If they continue to monitor, make sure they cancel when they move out.  My parents bought a house and the monitoring was prepaid and my parents didn't know it.  One day he set the alarm off, the police show up and enter the house. He is standing there in his underwear chomping on a piece of pizza.  Ain't nobody got time for that!

  • Real Estate Investor · Somerset, KY · Member since 2011 · 211 posts · 64 votes
    12y

    Stick to your lease b/c it falls under utilities!!!!! Just b/c cable is available don't mean you should pay for it!! Tell them its a bonus it is for free until then!!! If they didnt ask about it prior then its not your problem either!! You were just making them aware it will be up to them to renew it in their name, case closed!!

  • Property Manager · Big Bear Lake, CA · Member since 2013 · 585 posts · 330 votes
    12y

    I can see both sides. They assumed it was included, because no one said it wasn't. You assumed it wasn't included, because you didn't tell them it was. Because of the misunderstanding, I would pay the monitoring until their lease is up. If they renew, make sure it is in the lease that they are responsible for it.

    Having said all of that, I also think you are in the right if you say they are responsible. I'm not sure I would consider the alarm system part of utilities. Most people are going to assume those are gas, electric, water and trash only. But, then you get unhappy tenants and it just may not be worth it. I would suck it up and pay till the lease is over. You are paying for 5 months anyway. If this is a one year lease, it really is only 7 months you will have to pay. Splitting the cost could be a good compromise, like @Shawn Thom said.

  • Property Manager · Big Bear Lake, CA · Member since 2013 · 585 posts · 330 votes
    12y

    I am now adding a clause in my lease about alarm system monitoring. I've always just told tenants verbally that they are responsible for the cost, should they choose to use it. Now it needs to be in writing.

  • Baltimore, MD · Member since 2014 · 3 posts · 1 vote
    12y

    Thanks for all the great feedback! I weighed the input carefully and decided to draft an addendum to my lease stating that complimentary security service would be provided until Dec 31, 2014 thereafter tenant is responsible for the service fee. It went over well. This is a two year lease and I didn't want to commit to being responsible for anything else - I just received the water/sanitation bill and I'm already regretting that I didn't distribute that cost. Hey but this is a learning process. All my lease documents were signed, checks turned in and I feel so excited that I decided to make my first property an investment property. 

    Now I'm ready to set my next goal and find another duplex or triplex to purchase! 

  • Chris K.Pro Member
    Investor · Baltimore, MD · Member since 2012 · 1k+ posts · 655 votes
    12y
    Originally posted by @Carmen Washington:

     I just received the water/sanitation bill and I'm already regretting that I didn't distribute that cost. Hey but this is a learning process. 

     Oh my!! Yes this is definitely something you don't want to do (unless required by law). They can run those bad boys up quick when they think the water is free.

    Congrats and good luck with your goals.

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