Trade work for Rent?

30 Replies

We have a property that we are looking to do some work on -- we are looking at some drywall work, flooring, and a few other odd jobs. We can do it but, life has gotten in the was and we dont think we will get it done fast enough. We would like to get the property rent out. We are trying to decide if repairs can wait. Someone then approached us that they could do some of the repairs is trade for a discount on rent. Would you or have you traded the labor on the house for rent? Why or why not?

Never agree to trade work for rent. Tenants are 100% unreliable and will usually do a terrible job. They will take advantage, over charge and probably never finish the work. If the guy is a qualified and licenced contractor consider hiring him to do the work but never agree to trade work for rent. Hire him before you rent the unit to him not after. Always keep your tenants and contractors separate.

@Aubrey H. I third this sentiment. Not only will the work likely be of poor quality, but it sets a bad precedent that will probably bite you in the end. Have the work done to your standard and the charge full rent.

I'm on board with everyone else. Even if the guy were a licensed plumber and offers to install a new water heater, you should always, always, always keep rent and services separate.

If your tenant is fully capable of doing the job, hire them like you would any other contractor. They should have insurance, meet your deadline, submit to inspection, etc.

I don't have any revelations to add, but you should never offer a discount or trade for rent in any situation. Once you negotiate rent, everything becomes negotiable and you lose any leverage with a tenant that you might have had. 

Don't trade work for went, Tenant are non reliable and possibly never picked up a hammer in their life. I rather leave the house vacant for another month and find a reliable tenant once it is ready. They will use this repair to their advantage in the future.

Sooner or later your landlord is going to make you angry. Sooner or later your boss is going to make you angry. If you are both the boss and the landlord, it will be sooner rather than later!

well of course in my reverse landlording style.. I have tried this a few times.. NEver works.

This is a terrible idea.

Pretty much any renter that will move into a place that is not rent-ready is going to suck.

One reason renters rent is because they don't have to do maintenance or deal with the issues that come with home ownership - so it really makes no sense for a renter to want to move into a place and do a bunch of work that an owner would have to do.  

I agree with everyone! The other thing to consider is on paper or in multi family properties, this can actually lower the value of the property. 

Landlord    "  That drywall looks good nice job "

Tenant  " Thanks I figure I dont have to pay rent for 9 months , and you owe me $1200 for supplies"

Landlord  " F$%#  That   BU&^%*#@ "

Dont do it 

If I knew the person's work, I might allow it. If he does remodeling for a living.... But it could turn into a hack job real quick. Maybe let them do one job and see how it turns out. 

The trades tenant is too exhausted to do anything for their landlord. On their own time they do not want to be bothered.

Unless they are out of work needing money to get caught up with rent. My experience they are not motivated.

I have tenants that do work for me but I do not pay for them to work on their own apartments and I do not permit tenants to make unauthorized improvements on their own apartments. 

However, when I have vacancies, I have one tenant that can install a toilet or a sink faucet; he occaisionaly runs into a problem and has to call for help but most of my toilet installs cost $10-$20 (I pay $10/hour). I have one girl that does a super job prepping old crufty trim for painting (in 100 year old buildings with 6" oak with many layers of crappy paint). I give her a red devil and an orbital sander and a pack of sandpaper and she gets that baseboard smooth as a babies bottom; it makes a huge difference in the paint job and I could never afford to have professional painters do that. It took a little training and figuring out what to ask for but now I just tell her how much I want to pay for-- ie 2 hours on this trim so do 15 minutes on each wall base and 20 minutes per door trim and do the best that you can. That gets me a pretty nice job for not too much money.

I have another guy that likes to lift. It costs me $20 to get a refrigerator up 3 flights. Call a company and see what you'll pay.

Well, looks like we have a consensus.

However, my mom has actually had a guy paying discounted rent for 9 months now in exchange for work on a property. I don’t know how, but she managed to get an awesome guy in there and the arrangement has been working out so far. He’ll buy supplies or get free stuff from jobs, has his own tools/truck from his day job, and we work together on the weekends sometimes. 

The house is a strange situation though - half is gutted and awaiting money, permits, and reno, the rest is pretty junky too. My mom lets him customize stuff as he wants, and he can have his band practice in the gutted area of the house. I definitely wouldn’t copy the way she has managed the investment so far, but she does have a tenant who’s paying reduced rent so I just wanted to give a counterpoint that it could work.

A guy who has approached asking about it could work out really well, or terribly.

I agree, I have a great tenant who is an electrician. I occasionally hire him for electrical projects, but not in exchange for rent, it is separate. 

@Jill F. I hope I read that wrong. I really hope you don’t send your tenant to sand 100 year old trim. LEAD!!! As a landlord, you need to be aware of RRP procedures and can land yourself in a lot of trouble if there’s lead dust being created. (Not to get off topic). Of course, maybe I read your post incorrectly.