Corp halfway house tenant - Good Or Bad?

Question

Hi everyone! I have a vacancy and was just approached by a company that places tenants coming out of drug rehab. They said the types of people are DUI, drug rehab, family abuse, etc. and they stay for a short period. Felony background checks are performed on all prospective tenants by the company. This is an important factor since I would be doing a long term lease with a corporation I wouldn't get to say who is actually staying in the house. It seems like it would become a half-way house really.

About my property: It is a seven year old duplex with 3bed 2baths about 1400 sq ft each. I have a section 8 tenant in one unit and the other is vacant. They would have upto FIVE people living in the unit at one time! Seems like a lot and brings up wear and tear concerns.

My questions are:

Has anyone had experience with this type of arrangement?
How can I investigate more about this type of rental arrangement?
Get referrences like people who have been prior tenants and other current landlords? 
Should I be asking anything specific?

Care to start a Pros and cons debate? :)

Thanks for reading!

Jeff Takle · Answer

I've also got to imagine that it makes the property IMPOSSIBLE to get rid of if you want to dispose of it.  Probably makes for terrible showing to prospective buyers and you'd be pressed to find someone else who's eager to take that situation on.

I agree, if you could get a HUGE rent premium, maybe you could make it work out well enough.

Bryan Casteel · Answer

Sounds like it could be a nightmare.  If you were going to take this on, you should get a HUGE rent premium.  Why do it if they are just going to pay market rent?

If you are brave, it could be a profitable niche to be in, but you may curse the day you ever got involved if it blows up in your face.

Tony B · Answer

BUMP