Never again. Unless you BOTH just so happen to be extremely responsible, reasonable, high-quality, stand-up individuals, something will inevitably go wrong. And even then I'd still not do it.
my instinct is "NO", but I suppose if there was no other option for them, I would
I want to clarify - I initially said NO, then thought about the 20K + people that lost their homes to the fires here. If one of my friends was homeless? yes.
@Justin Petrides most of the time I’d say No. but I have one rental leased to a buddy. He’s got a young family and is super responsible. So it all depends. If ur even thinking this might be a tough call id Pass.
@Bradley Bissett thanks I appreciate everyone’s input .I was trying to help a friend out with the purchase of my house by letting him and his wife rent it while they saved money but I think it’s best to just pass . I realized that if I want to get started in rentals I need to do it as a business and nothing else .
We have a STR Vacation property with another couple, and have NO "Friends & Family" discounts or preferred bookings or anything of the sort, and told them all this from the beginning. Go to VRBO and book the place through the site and pay the rates posted if you'd like to stay there...maybe I'll leave you a gift certificate for a local seafood place since you're a friend. But probably not.
I am also house hacking 2 rooms to my friends while living in the other. I was hesitant at first, but its been great. I did not make them sign an official lease, but I did make them sign an "agreement" stating what theyd pay monthly, when its due, etc.
@Joe Brisindi I know them very well. They currently rent a 1 bedroom and are looking to buy a house . I was thinking of renting my 3 bedroom home out to them for about half of market value because they are interested in purchasing it but aren’t ready financially yet. The house is in Pa and I’d be living in FL. I don’t feel comfortable being an absentee landlord. Putting someone in the house I know well i thought would be a better idea then keeping it vacant while it was up for sale . I’m thinking of a rent to own contract with them .
@Joe Brisindi I know them very well. They currently rent a 1 bedroom and are looking to buy a house . I was thinking of renting my 3 bedroom home out to them for about half of market value because they are interested in purchasing it but aren’t ready financially yet. The house is in Pa and I’d be living in FL. I don’t feel comfortable being an absentee landlord. Putting someone in the house I know well i thought would be a better idea then keeping it vacant while it was up for sale . I’m thinking of a rent to own contract with them .
@Joe Brisindi I’m not worried they won’t pay , I’m worried they won’t purchase after being there for a year. We have been talking over some different options and it doesn’t seem they have any money . I’d like a small initial down payment or raise the rent and take a portion and put it towards the purchase of the house .
@Justin Petrides probably not. If you rent and give them a “friends and family discount” you will expect them to earn it by treating your place a little nicer because they are friends or family. But they wont. And then your taxes, etc. go up and they get miffed with the rent increase. And you know its a great deal but they don’t because they don’t watch the market. And the market says you now should be getting $200 more a month so they are beginning to really cost you. And the place was nice when they moved in and its getting shabby and they start thinking of you as a slumlord even though it is them, their stuff, their pets that are creating the shabbiness, for the most part. And you get to thinking about how to get them to leave and there is just no win-win because moving is a hassle. But it could work out fine. The more affluent they are, the more business minded, the more likelihood of sucess, I would think.
The big issue here tends to be that they can feel like they need special treatment. Friends and Family often get frustrated when you don’t let them pay late, or they have to wait for a repair man.Plus, will you feel comfortable raising the rent when the time comes? How would each of you react if they caused a flood and need to pay for the repair? This can end friendships and cause more problems. Tread carefully my friend.
@Justin Petrides im gonna say house hacking yes renting full properties no. Its easier to maintain a good line between friends and Tennant's full on properties and if your living with them its like your on the same side working together. Not against or some sort of other type thing.
Generally no. However we rented to my MIL for many years and she was an ideal tenant-the rent was below market; but never a problem. Never say never, I guess.
@Justin Petrides we did one time in our first rental and personally I would not do it again. We didn‘t have a terrible experience or anything like that but I think that’s the exception and not the rule. The landlord dynamic is always off in that type of situation.
In the future I would provide other assistance (recommendation, help finding a place, etc.) before renting to a friend.
Best of luck.
If this isn't an emergency (lost their home due to circumstances beyond their control such as fire) and they wouldn't qualify under normal circumstances, then, no, you should not rent to friends
I have friends that I would rent to and friends that I would not rent to. I know my friends well enough to know which would be a good fit. I would not, however, give any discount/special treatment to them. They sign the same lease under the same terms as any other tenant.
Generally no but I am renting one SFR to a good friend. She’s wanted to live in the house ever since I bought it. She’s been as quiet as a church mouse since she’s moved it and rent is always deposited on the 1st. I’ve given her a slightly below market rent but considering I’m saving on a property manager I’m still on top. So while generally I would not rent to F/F this situation has worked out pretty good for me.