Coin-Op washer and dryer

Davon Lowery · 2015-05-30T21:52:07-07:00

So, finally got the second tenant for the duplex and almost lost them the same day. The tenants are responsible for their own electricity and gas, I pay the water and trash. My mentors have advised me to either, take out the the washer/dryer hook-ups (cap off) or put in coin-op laundry, protections against countless liability reasons, i.e. laundry business etc...So, after the applicant, now tenant, signed the lease agreement and the supplemental renters addendum, which clearly states in section 'J' subsection '1', "no personal laundry units shall be installed and or otherwise used by any tenant at any time{....}, landlord reserves the right to discontinue laundry access at anytime for any reason."The tenant signed everything and when we met today we had a back and forth about what was explained and how I'm not operating fairly, this is bad business, will I reimburse them for the electricity and gas that they use...yada yada yada. To which I promptly responded, everything was clearly articulated in the lease agreement and the renters addendum and if you so choose we can end the application process now and I can refund all of your deposit and first months rent. The applicant stated that part of the deposit went to the leasing company. I contracted with them to handle screening; they have a no-refund policy once applications are singed and deposits are surrendered. They too informed the tenant that I would be installing my own company washers and they would be coin-op.I allowed the tenant approximately 3 hours to think it over and decide with the family. When I called the tenant back, I was informed that if they backed out now they would loose their deposit, and again how my business was unfair. My response was firm and steadfast, you are renting. Laundry is a privilege and not an entitlement, moreover, you are a renter and if you would like to make your own rules then you would have to become a homeowner to be fully satisfied with your living arrangements. Again, I reminded, everything was in the addendum, the response was yeah, I didn't read it.I thanked them for choosing to do business with DNL Investment Group, and we look forward to having them as tenants. If there is ever any need please contact your property manager and you will receive a response in less that 24 hours.....yada yada yada.To be honest, after the exchange and the malcontent tone and basically subtle insults, I didn't want them as a tenants anyway and was hoping that they would back out under their own impulse, as we are both bound for the deposit with the leasing company. My question, to my multi-unit landlords is, what's your take? Unfair? Unprofessional? Anyone can comment, just would like my multi-unti folks to take note.

Marcia Maynard

Investor · Vancouver, WA · Member since 2013 · 3k+ posts · 4k+ votes

11y

1) I think your mentors gave you some bad advice. In a duplex unit, I would have left the washer/dryer hookups and would have separately metered the units if I could. If I couldn't separately meter, then I would factor the water cost into the rent. I would screen well and guard against overuse of the water by having a clear clause in the rental agreement about water use and I would monitor it. Our duplexes are separately metered with w/d hookups and the Tenants provide their own machines, but we hook them up to make sure they are done properly.

2) Putting coin-op machines in a Tenant's unit would not be cool. But if you created a separate coin-op laundry room that could work well. For our 8-plex we pay for water. We have a separate laundry room with coin-op machines that the Tenants share. It works fine.

3) How was the unit advertised? Were you open, honest and clear in your advertising? Would there be any reason the applicant would not know about the laundry situation before committing to apply and pay the deposits? This is why I let Prospective Tenants read our entire lease/rental agreement prior to even applying.

4) The ability to do laundry is a basic need. Is it your intent for Tenants to take their laundry off-site, like to a laundromat? If so, I can tell you... your pool of qualified applicants will drop significantly, unless this is the norm for the area and for your market. It is reasonable for a Tenant to think they could do laundry in their own home, or at least on the premises. If not then it should be clearly stated in the advertising.

5) I suggest that you take this as a learning experience. Obviously there was a breakdown in the communication at some point. I would allow the Tenant out of the contract, refund the rent and deposit, but not the application fee. I would negotiate this with the leasing company if necessary. I think all three parties should bend a little here.

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Account Closed

San Jose, CA · Member since 2015 · 4k+ posts · 3k+ votes

11y

I agree you should let this tenant go. How much money will you be out?

And I wouldn't use the leasing agent ever, ever again. You're doing all the work anyway.

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Davon Lowery

OP

Investor · Whitttier, CA · Member since 2015 · 405 posts · 110 votes

11y

Thank you @Marcia Maynardand @SueKelly

I appreciate the input.

Yes, I did reach out to the leasing company, they haven't responded yet (weekend).

No, the laundry is not in the unit, it is outside in the garage, not in the units. We fully disclosed what type of laundry it would be and there is no excuse for not reading a contract and or a supplemental agreement. Were talking $750, separating the meters is prohibitively expensive out here not sure in your states; ROI on that endeavor is out the window, $7k minimum.

Frankly, the coin-op is not for profit, only protections. I work very close with public utility professionals and I listen to irate landlords as they rant about $2,3,5,7,$10k water bills. Some tenants are ruthless and will operate multiple businesses under the auspices of water included; laundry service and car washes to name a couple.

Also, I recall us having a conversation about the laundry before we met today, I make it a point to give a phone interview prior to accepting a tenant.

I can't really fault the leasing company either. They handled all the showings and no shows (ppl not showing up for scheduled appointments, that would drive me crazy). The background checks and facilitated the transfer of funds, keys and created contract language that binds the applicants into a year lease with the landlord.They did their job, as we did ours. The onus is on the applicant to do their due diligence. Believe me, I would gladly not deal with unhappy tenants thats why I provided them with options immediately.

Don't get me wrong, I am still willing to let them off the hook. However, I think the discontentment is all for not, they already stated that they needed to be out by the 1st and seeing how its the 31th today, I think the options have slowly eroded away.

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Marcia Maynard

Investor · Vancouver, WA · Member since 2013 · 3k+ posts · 4k+ votes

11y

@Davon Lowery Okay, understood. So you are indeed providing a coin-op laundry to the tenants of both units, located in an area that can be accessed by both tenants and you. Then why state in your lease: "Landlord reserves the right to discontinue laundry access at anytime for any reason."? I don't think it is fair to say that. If you strike that from your rental agreement, then you will probably gain points with the tenants of both units.

Are the machines in place or just promised at this point? Did the applicants see the machines when they toured the unit? Did the advertising say coin-op laundry on premises, or something to that nature? If you are clear about what you are or are not providing, you will be in a much better position. Otherwise it could be seen as a bait and switch.

You asked for our take... a candid opinion of someone who owns multiplexes. Well, I think you could have done better. This concerns me:

"My response was firm and steadfast, you are renting. Laundry is a privilege and not an entitlement, moreover, you are a renter and if you would like to make your own rules then you would have to become a homeowner to be fully satisfied with your living arrangements. Again, I reminded, everything was in the addendum, the response was yeah, I didn't read it."

I would never talk to our Tenants in that manner. It doesn't sound professional to me and sounds a bit condescending. If you intend to establish a good landlord-tenant relationship, then be polite, firm, fair, and sometimes flexible. Even when the tenant isn't. Seek to understand their position. Go for a win-win. I don't expect tenants to fully absorb all that comes at them when leasing a unit; it's like drinking out of a fire hose. It's human nature to miss some things and have second thoughts. Even buyers remorse.

Could this relationship have been saved? Maybe if both of you hadn't given up on it. Unfortunately, once communication becomes heated, the relationship takes a big hit. Perhaps fatal. Since you gave the tenant the option of ending the application process (rescinding the newly signed lease) and offered to refund their deposit and first months rent, do so and move-on. I think you're doing the right thing there. Then work out a different arrangement with the leasing agent, since the tenant they placed fell through.

But if there is a glimmer of hope, you and the tenant could decide to revisit this on Monday after you have both had a chance to cool down and reconsider your positions. All the parties involved have invested quite a bit of time, effort and money. The tenant probably doesn't look forward to restarting the home search any more than you look forward to restarting the tenant search. I truly hope it works out for all of you.

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Roy N.Pro Member

Rental Property Investor · Fredericton, New Brunswick · Member since 2013 · 7k+ posts · 4k+ votes

11y

@Davon Lowery

7K sounds unreasonably high to sub-meter water at a duplex. Our worst case {thus far} is a five unit where the cold water run to each unit was not independent, so we have had to run separate lines to three of the units. Even then, five sub-meters, manifold, plumbing and drywall repair was < 3.5K.

You are not running a separate line from the municipal water supply, all your sub-metering will occur downstream of their entrance and existing meter.

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James Wise

Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes

11y

Coin operated laundry for a duplex is a little much. That doesn't fly in my city.

What are the other duplex owners doing?

Are the coin operated machines that are used by both tenants operating off of one of the tenants gas and electric meters? If so that's going to be an ongoing problem.

$750 is not a lot of money, I would provide two hookups and allow tenants to use their own machines.

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Davon Lowery

OP

Investor · Whitttier, CA · Member since 2015 · 405 posts · 110 votes

11y

Update:

The property manager and I met with tenant today, gave keys and short update on the progress of the property, continuing to upgrade the property etc... We were all pleasant and cordial. However, I think it be best if I remove myself, for the time being and let the property manager do the job.

Thank you all very much for the dialog, I really appreciate it. Just because we all don't agree, doesn't mean we can't have a conversation, I welcome the discussion. @Marcia Maynard That was heart felt and I appreciate it. I have much respect for your input and value your experices.

Marcia, after talking to my property manager we agreed that we need to speak to clients in a professional manner at all times and I fell short. I will continue to endeavor to always remain professional, even if they are not. This is not a school yard, this is my business. Likewise, always communicate and overstate what the rules and policies are and are to be.

@Roy N. Yep, that is the going rate out here my friend. Trust me I have access, the meter alone is $3k, then we are talking about braking concrete, contractor and permits. Nightmare. Again, ROI on that endeavor is slim to none at best like

Correct @James Wise every market is different, this is a C-D neighborhood and tenants have been know to take advantage of a good situation.

Last year I evicted 3 tenants, all for non-payment and the units remained vacant for a year. Without the violins playing and going too much detail, the evictions sapped my rehab budget and delayed getting the units rent ready.

I have learned the hard way that California is not a business friendly state, in that landlording is a business; therefore, I have to be, including any one on my staff that is interacting with tenants, has to be educated in the California tenants rights and landlords responsibilities publication. As a landlord, enduring, scrapping by, while someone is living off of you is not anything that I would wish on another person. Granted not every tenant is like the other but, I have to exercise prudence and use wisdom to avert and mitigate any possible snafus.

So, when renting to anyone I am very frank, not crass or rude, I am firm and what I perceive to be fair and when i'm not my property manger helps me. I find no fault in my decisions and am resolute in my beliefs. At the end of the day the tenant was provided with options and chose to remain. I am not and will not make myself responsible for the errors of others, if at all possible. To pay $750 from my management budget to the leasing company because the tenant didn't read the contract and when received verbal confirmation, later electing to stay, is not the way I conduct business.

I made it clear that if it was going to be a problem we can resign the contract and lease stating that their will be no access to laundry period, or the tenant can move on.

I don't know how, after having a conversation prior to meeting and then proving someone with a written synopsis of the conversation that I can be liable/responsible for their error. Then providing them with an out and they refuse to take it.

IMHO, this is a simple case of, I want something for nothing.

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