Is New Jersey becoming a "professional tenant" haven?

Is New Jersey becoming a "professional tenant" haven?

Rental Property Investor · North Jersey, NJ · Member since 2013 · 72 posts · 21 votes

Hello everyone,

My story comes out of North Jersey where it seems that being a landlord is becoming more and more of a nerve-racking stroke-causing endeavor. 

My parents have owned and operated a 3 family house out of Paterson since the 1980's. They never had any major problems with tenants until last August. It all started when a tenant, who we rented the third floor to, brought in two new individuals who we have never seen before. My parents immediately gave him a call and asked him who those two people were. The tenant never really gave us a straight answer. We then sent a notice to quit a few days later.

A week or so later we had several agencies from the city calling us and telling us we had an "illegal rooming" house and several violations we needed to fix asap. The two individuals had built a makeshift wall in the living room and accused us of building it and renting the apartment as a "rooming house" which it was not and never has been. Coincidentally enough it was around this time (i think a week or so earlier) that my mom filed to evict the third floor for non-payment. And then the fun began. 

Thinking it was a routine eviction (we had probably done one every two years for the past decade) we went into court. While there we saw the two individuals and our tenant with a lawyer. (Big red flag. Most of our evictions the tenants would never have lawyers because it woukld always just be about non-payment) The proceedings started and the attorney immediately accused of of renting a "rooming house" which the house inspectors had declared it was on their report. We told the judge it was all lies but wouldnt really hear us out probably since we didnt have an attorney and he had already expressed dissatisfaction with this. He granted SIX MONTHS RELOCATION FEES TO OUR TENANT. In order to have possession of the apartment we had to pay, which we did the same day. Because of the slow court system it took us almost 5 months (from the time we filed the original eviction) to finally have the apartment back. Now a few days later after we took possession the other two individuals are suing us and saying they also rented from us as a "rooming house" and want six months relocation fees as well as any other damages and attorneys fees. 

We've had an attorney on this case for a few months now and he's as dumbfounded as we are. Neither him nor I understand how someone can illegally move into an apartment, build a makeshift wall with a couple of 2x4's and sheetrock and then claim it is an illegal rooming house and have the court believe them. I asked my attorney what constitutes a rooming house? He said that the people rooming have to pay the landlord separately. These individuals never paid us a dime. Yet in court they lied on the stand saying they did pay us (no receipts, no documents, no pictures, no nothing) and the court believed them. 

It seems that in New Jersey this is becoming more and more of a common practice. I've talked to neighbors in towns like clifton, passaic, newark and paterson who have experienced tenants taking advantage of small time landlords.  Tenants who are taking advantage of the friendly tenant laws and the system. The ones who are the most vulnerable are the small or medium sized landlords and they know that. I'm becoming sick of it.

So, our fear is that the 2nd floor is good friends with the guy who got evicted and is telling them to do the same thing. Simply put a mattress in the living room and claim that you are living in a rooming house and the tenant friendly court will give you 6 months relocation fees. They can do this for each individual living in the apartment. ITS SOMETHING THATS BEYOND WORDS. 

I thought I'd share this story to you all as a warning. If anyone wants to share your thoughts or advice please feel free.

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Susan H.Pro Member
Investor/Landlord · NWA, AR · Member since 2016 · 227 posts · 132 votes
9y
Originally posted by @Marco Y.:

Hello everyone,

My story comes out of North Jersey where it seems that being a landlord is becoming more and more of a nerve-racking stroke-causing endeavor. 

My parents have owned and operated a 3 family house out of Paterson since the 1980's. They never had any major problems with tenants until last August. It all started when a tenant, who we rented the third floor to, brought in two new individuals who we have never seen before. My parents immediately gave him a call and asked him who those two people were. The tenant never really gave us a straight answer. We then sent a notice to quit a few days later.

A week or so later we had several agencies from the city calling us and telling us we had an "illegal rooming" house and several violations we needed to fix asap. The two individuals had built a makeshift wall in the living room and accused us of building it and renting the apartment as a "rooming house" which it was not and never has been. Coincidentally enough it was around this time (i think a week or so earlier) that my mom filed to evict the third floor for non-payment. And then the fun began. 

Thinking it was a routine eviction (we had probably done one every two years for the past decade) we went into court. While there we saw the two individuals and our tenant with a lawyer. (Big red flag. Most of our evictions the tenants would never have lawyers because it woukld always just be about non-payment) The proceedings started and the attorney immediately accused of of renting a "rooming house" which the house inspectors had declared it was on their report. We told the judge it was all lies but wouldnt really hear us out probably since we didnt have an attorney and he had already expressed dissatisfaction with this. He granted SIX MONTHS RELOCATION FEES TO OUR TENANT. In order to have possession of the apartment we had to pay, which we did the same day. Because of the slow court system it took us almost 5 months (from the time we filed the original eviction) to finally have the apartment back. Now a few days later after we took possession the other two individuals are suing us and saying they also rented from us as a "rooming house" and want six months relocation fees as well as any other damages and attorneys fees. 

We've had an attorney on this case for a few months now and he's as dumbfounded as we are. Neither him nor I understand how someone can illegally move into an apartment, build a makeshift wall with a couple of 2x4's and sheetrock and then claim it is an illegal rooming house and have the court believe them. I asked my attorney what constitutes a rooming house? He said that the people rooming have to pay the landlord separately. These individuals never paid us a dime. Yet in court they lied on the stand saying they did pay us (no receipts, no documents, no pictures, no nothing) and the court believed them. 

It seems that in New Jersey this is becoming more and more of a common practice. I've talked to neighbors in towns like clifton, passaic, newark and paterson who have experienced tenants taking advantage of small time landlords.  Tenants who are taking advantage of the friendly tenant laws and the system. The ones who are the most vulnerable are the small or medium sized landlords and they know that. I'm becoming sick of it.

So, our fear is that the 2nd floor is good friends with the guy who got evicted and is telling them to do the same thing. Simply put a mattress in the living room and claim that you are living in a rooming house and the tenant friendly court will give you 6 months relocation fees. They can do this for each individual living in the apartment. ITS SOMETHING THATS BEYOND WORDS. 

I thought I'd share this story to you all as a warning. If anyone wants to share your thoughts or advice please feel free.

 I'm very sorry to hear about the difficulties you and your family has experienced. I'm not a lawyer, so you should certainly ask your own lawyer, but I wonder...would it be worth your time to include in your lease "This is a [describe apartment]. Tenant understands this is NOT a rooming house. Landlord expressly prohibits sub-leasing..." etc. etc. etc.

I live in a university town and have an addendum to my lease (with signature required) stipulating the zoning ordinance for single family homes and who can and cannot reside there. 

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  • Developer · Philadelphia, PA · Member since 2015 · 2k+ posts · 904 votes
    9y
    Mark Y. , that sucks! Do you have a landlord association in your area? Sounds like it is something they may be able to offer help with or at least should be aware of. Can your attorney use the threat of perjury against the plaintiffs? Somewhere on here is a link to a tenant review site and I would definitely leave a comment for them.
  • Columbia, NJ · Member since 2015 · 47 posts · 20 votes
    9y

    @Marco Y. 

    This thread is extremely helpful. As a newbie looking to invest in multifamily properties in NJ I now know what tenants I may run into down the road. 

    Best of luck getting this issue resolved!

  • Howell, NJ · Member since 2016 · 87 posts · 56 votes
    9y

    Just as important as the right tenants is the right area.  In Jersey, stay way from the poor areas if you're going to actively seek tenants for a rental.  It's that simple.  

  • Rental Property Investor · Red Bank, NJ · Member since 2017 · 1k+ posts · 1k+ votes
    9y

    Perhaps consider paying $25 to have a tenant report. I have any new tenant sign photos of the apartment I print out, seems that would have short circuited this. Also consider retaining an attorney to draft a lease that you can reuse.

    I am very sympathetic to your troubles and your loss, but I also believe you bear some of the responsibility in not protecting yourself. I enter into all of my leases with the assumption that I will have to provide supporting evidence to a court to prosecute an eviction and likewise to defend a claim by my tenant. The moment you noticed someone else at the rental you should have drafted a notice to cease and informed the tenant you would schedule an inspection to ensure he was the only resident. Bad tenants hate getting papered! A notice to cease is awesome because it allows you to begin telling the story- your version. So when you filed for eviction and you have six different notices documenting what has transpired in real time you have effectively gotten to the judge first. Also the judge is going to see that you are a contentious and professional landlord. This has served me well- but this is only one component of my responsibilities.

    I love owning a rental property because it allows me to engage in different jobs and responsibilities. I find that to be very exciting. But I also want to be the best in my duties... so look at it a different way:

    If you hired a broker to vet your tenants and a property manager and you found yourself in eviction court every 2 years would that be acceptable to you? On a three family house? I would find it unacceptable on a 10 unit building. I would fire both immediately. Also, if I was one of your other tenants I would be very put off by all of the drama and nonsense going on because my landlord rented to jerks.

    I hold myself to a very high standard and I also have a tremendous sense of responsibility to my tenants, neighbors and town. But I also find it very fun and I have had a great mentor without whom I would be lost.

    I highly recommend the book "Landlording." But also consider using a broker and property management company, with the trouble and financial loss you are dealing with now it would more than pay for itself.

    The Asbury Park Press just did an excellent 4 or 5 part series on the state of landlord/tenant around the state. I was appalled at what landlords get away with and what tenants are put through. From decrepit, overcrowded apartments to using the LLC to duck legal responsibilities, it is bad. We all know they are the vast minority, but they are the ones that are going to dictate public policy and the ones people remember. And do you think there was one story on problem tenants- nope not one... and God knows there are some good stories out there.

    Anyway- best of luck, I hope you can come out of this for the better! 

  • New Jersey, NJ · Member since 2015 · 327 posts · 137 votes
    9y
    Staying away from the poor areas is not the simple solution. Whatever area you choose to have a rental properties just be more prepares with all the great advice you are given in this forum. Being a landlord in poor areas is more of a job than investing and some landlords manage it well because they live in those areas and understand it.
  • Member since 2018 · 3 posts · 1 vote
    7y

    this sounds like a nightmare.

  • Rental Property Investor · Union city, NJ · Member since 2016 · 203 posts · 43 votes
    7y

    @Mark Y.  believe it or not i am going through a similar scenario, in south jersey city. i do have cameras outside, and it is owner occupied, but still its a tricky situation. will PM you

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