Tenant Incentive for Property Maintenance

Tenant Incentive for Property Maintenance

Investor 路 Clarington, Ontario 路 Member since 2015 路 2 posts 路 0 votes

Hey there, my duplex is currently tenanted with a retired gentleman upstairs, and I'm working on getting the lower unit tenanted asap.  For the first year I have handled the Grass Cutting and Snow Shovelling myself.  The unit isn't too far away, and I enjoy the work, but as my life gets busier I am hoping to get this off my plate.  I am trying to place this responsibility on the next lower tenant and am considering rather including this agreement on their lease and reducing their rent immediately, or leaving it as a verbal agreement where I "refund" $50/month as long as they're keeping the grass and snow under control.  Specifically, I would ask they still pay me the full rental amount every month, and that's what the lease will state, but then I can e-transfer them the $50 back as long as they're holding up their end of the deal.  My idea here is obviously to incentify them refund money, instead of include it on the lease and risk them not fulfilling the promise.  

I've heard there's risks of accidentally becoming the tenants employer this way, and then getting in trouble if they hurt themselves during shovelling the driveway or something.  I am in Canada, and I'm reluctant to believe a court here is as likely to pin that fault on a landlord based on a friendly deal to look after the lawn, but maybe I'm wrong?

Does anyone have a better idea, or advice?

Thanks!

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Investor 路 Philadelphia, PA 路 Member since 2015 路 3k+ posts 路 3k+ votes
9y

Why pay the tenant? 

Either go with @Roy N.'s suggestion or simply pay a landscaping company to take care of it.

I prefer to not complicate the landlord-tenant relationship with extra arrangements.

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  • Roy N.Pro Member
    Rental Property Investor 路 Fredericton, New Brunswick 路 Member since 2013 路 7k+ posts 路 4k+ votes
    9y

    @Adrian Ede

    You can simply tell the tenants they are responsible for lawn care and snow removal and let them work it out themselves - no rebates, no stipend.   When we have done this we also made it clear in the lease that the tenant is responsible for any citations/fines for an unkempt premises.

    These days, where our smaller buildings are predominately student rentals, we take care of the snow removal (driveway & egress window wells, the tenant is responsible to shovel steps and walkways, though we end up doing them at least once per month) and lawn care and simply bake it into the rent.  I have found this to be the simplest and best way of handling snow removal and lawn care - you know its going to get done; that a shovel will not get put through the siding; and your insurance company will be much happier that you have a (insured) third-party handling snow removal and lawn-care.

  • Investor 路 Philadelphia, PA 路 Member since 2015 路 3k+ posts 路 3k+ votes
    9y

    Why pay the tenant? 

    Either go with @Roy N.'s suggestion or simply pay a landscaping company to take care of it.

    I prefer to not complicate the landlord-tenant relationship with extra arrangements.

  • Kim Meredith HamptonBusiness Member
    Real Estate Broker 路 St Petersburg 路 Member since 2014 路 2k+ posts 路 2k+ votes
    9y

    I prefer to have everything handled professionally. I never have the tenant handle such items, especially because they don't have insurance and workers Comp if they get hurt performing work on your property, or possibly damage or hurt something or someone else. CYA

  • Member since 2016 路 13k+ posts 路 12k+ votes
    9y

    What ever you choose, in Ontario, it is the responsibility of the landlord to do or have the maintenance done. If a tenant agrees to do it and then stops a landlord can not force them to continue doing the maintenance regardless of what is in the lease.

    Personally if I was not going to do it my self I would hire a contractor or better  hire a local kid to do the work. Any kid you hire will be less hassle and do a better job than a tenant.

  • Investor 路 St. Thomas, Ontario 路 Member since 2015 路 692 posts 路 312 votes
    9y

    Sorry Roy N. But Greg S. Is right about Ontario rules. Clauses for maintenance a d automatically void in Ontario.

  • Roy N.Pro Member
    Rental Property Investor 路 Fredericton, New Brunswick 路 Member since 2013 路 7k+ posts 路 4k+ votes
    9y

    @Matt Geerts

    Lawncare and snow removal are services and not typically considered maintenance - though in Ontario anything is possible :-)  If you read though to the end of my post, my recommendation is to take care if these and bake the costs into the rent.

  • Investor 路 St. Thomas, Ontario 路 Member since 2015 路 692 posts 路 312 votes
    9y

    It is perfectly reasonable to hire the tenant on a separate contract. If they dont perform you can just fire them. I have no idea what your liability would look like because they are just a contractor who happens to be your tenant. 

    Just dont reference the other contract in either contract or LTB will consider them to be one and null the yard work clause (but keep the discounted rent)

  • Member since 2016 路 13k+ posts 路 12k+ votes
    9y

    The common consensus in Ontario is for landlords to make arrangements with tenants that both parties agree to but simply keep in mind you can not inforce the agreement. As long as a tenant agrees there is no violation of the RTA. 

    It would be similar to having a "no pet" clause in your lease, providing the tenant agrees, it is fine but as soon as they bring in a pet the "no pet" clause is voided.

  • St Thomas, Ontario 路 Member since 2013 路 575 posts 路 408 votes
    9y

    @Adrian Ede The problem with a discount on rent or similar is that if the tenant then stops performing the assigned duties there is nothing you can do, and if you attempt to take away the discount and increase the rent back to the 'normal' level the Landlord and Tenant Board would hold this to be an illegal rent increase. Instead as has been discussed you can enter into a separate agreement aside from the tenancy in which the tenant agrees to provide certain maintenance services and you pay the tenant $X. This contract can then be ended for nonperformance if the tenant stops doing the work. It has the same effect but gets around the nonsensical outcome of the LTB in effect forcing you to grant a permanent discount regardless of whether the work is performed.

    This does not address the question of what happens if the tenant is in your employment and is injured. This is one of several reasons why I prefer to rent townhouses. All of this kind of thing is the responsibility of the condominium corporation and they take care of maintenance and snow removal. Liability for the employees of their contractors is their business. As is exterior maintenance, which reduces my management time. I know some landlords think they can avoid the costs that condo fees represent, but in most cases they are simply not accounting for or providing for these expenses and are in for substantial cash flow shocks down the line. Plus issues like arranging snow removal.

  • Investor 路 Clarington, Ontario 路 Member since 2015 路 2 posts 路 0 votes
    9y

    Thanks for all the great ideas. I think in my situation where maximum cashflow is my main need, I'm best off to put lawn care/snow removal into the Lease knowing that I can't hold them accountable, and then incentify them with positive re-inforcement (and beer).  Sometimes showing gratitude goes a long way, and  if they don't help me out I can always look into hiring a company, and drinking the beer myself. 馃榾

    Thanks again!

    - Adrian

  • Buy & Hold Owner 路 Redlands, CA 路 Member since 2015 路 5k+ posts 路 2k+ votes
    9y

    You can do anything you like -- until you get into any court action and the tenant claims unpaid labor .... & the ****hits the fan for violation of labor laws

  • Peter MacKercherBusiness Member
    Residential Real Estate Broker 路 Saint Louis, MO 路 Member since 2014 路 1k+ posts 路 567 votes
    9y

    @Adrian Ede I'm going to throw another hat into the "just hire someone camp". You're not going to get professional results from a tenant and it's not worth the effort to try and police them to ensure it's getting done. Your relationship is landlord-tenant and the more you complicate that, well, the more complicated it is. It sounds nice on paper saying you want to "maximize cashflow" but establishing that as a practice is not scalable since you're adding to the plate of things you need to manage which ultimately limits how much you can grow.

  • Jacksonville, FL 路 Member since 2014 路 12 posts 路 22 votes
    9y

    When I am signing a lease with a tenant, and they bring up renewal and price increases, I let them know that if they take care of the home like it is their home we usually dont raise rents on them. But on the flip side if they call me to change a light bulb and for little things every week, I can almost promise that the rent will be raised.

    It really sets the stage with the tenants, that we expect them to take care of the home they are renting like it is a home they own. Every since starting this practice, we have cut down on the number of "small jobs" that get sent into us.

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