Inconvience discount for broken refrigerator?

Question

The refrigerator in one of my units quit working last Friday.  It is a new refrigerator and is still under warranty.  The tennant has been GREAT through this and has moved all of their refrigerated items to a small refrigerator and chest freezer that they own.  The repair company is finally going out to replace the control board today and get the refrigerator working again.

My question is, should I give the tennant a discount for this month's rent for their inconvience?  If so, how much?  The tennant just moved in Dec 1 of last year, but has been the perfect tennant so far.  Rent is $900/mo.  I was thinking around $100 for their trouble.

James H. · Answer

I am not too sure I would offer anything if it is a new appliance and they know it is. Will the manufacturer comp you for your trouble? Or will they just fix it?

If these are reasonable people/tenants, how could they fault you for the refrigerator if you provided a brand new one? I think they could be just as happy if you just kept on top of it and followed up with the situation to make sure it was being handled as effieciently as possible.  From a good will standpoint, I think that would go just as far as some sort of comp.  So while the comp is nice (and who doesn't appreciate some cash or a gift card?), if you are doing your job it might just be throwing away money to make yourself feel better.

I consider myself a pretty nice and very reasonable person/landlord, but I would be afraid that comping them for something that is clearly not your fault sets the precendent that any time something happened they deserve a comp.

Just my .02. I haven't been doing this very long, but that is what my gut tells me.

Nathan Emmert · Answer

If you do anything, make sure you specify why you're doing it.  The danger you run here is setting expectations you don't plan to keep.

I would get them a gift card to a restaurant or something similar.  I would hand deliver it and I would say, "I know I satisfied the requirements in the lease, but given you just moved in, I just wanted to thank you for your cooperation during all of this."  Make sure they understand it's a gift, not a concession.

Joel Owens · Answer

Not having a refridgerator for a week is a big inconvenience.

On a water heater in one of units the thermocouple went bad.The manufacturer had a recall on that part so it would have been free with shipping.The problem is it would have taken over a week to be shipped to me.

Instead just bit the bullett and bought it that day at Lowe's for 8 bucks and corrected that day.

You have to remember with tenants PERCEPTION not REALITY is everything. If they feel you are slow to fix items they will tell others that you are slow to fix things yet want them to pay full rent.They will grow resentful that you (in their mind) are taking advantage of them  by putting off repairs and padding your pocket.
Tenants in apartment buildings or houses owned close by with the same investor talk.

With a house this isn't as noticeable but with apartment  buildings it is much more critical.It is imperative if you want to retain long term tenants to have a certain "hard but fair" reputation. My rep is I have a property manager and a maintenance guy living on site and items will be repaired right away.

The tenants also know on the 5th they are late and eviction will start immediately.

I think giving the gift card is a great idea.

Jeff B. · Answer

If the house was in a "lesser" neighborhood, I might consider just letting it go.  But it is in a nicer neighborhood (I'd say a "B" neighborhood), and there are nicer houses in the neighborhood for the same or less money.  The tennants have already stated an interest in staying long term (4-5 years) due to some health issues with one of their children, so I'm a little more inclined to go a little further in order to keep them.

Brian, the whole idea of a discount is to do exactly what you state.  Make myself feel good.  I feel bad that the brand new refrigerator went out.  Is it my fault, no, but it is my refrigerator and I am responsible for it.  When it went out, the tennant lost a few items, so I also feel responsible for that as well.

I do like the idea of a gift card to Kroger in place of the discount to replace the food that went bad.  I wonder if I can expense that instead of taking the hit on the income?  I would think so...

Cheryl C. · Answer

Brian, it's not the tenants fault either.  As a LL you are expected to get things resolved.  When I have a repairman over the next day, I don't give any credit - I'm just doing my job.  In my case I had a crew there for a week tearing up and installing new flooring.  Tenants stuff had to be moved out of the living room and dining room.  A pain in the rear (dust, carpenters,etc.).  A 2 day wait for a washing machine or dishwasher is not a big deal.  Perhaps a fridge isn't if they have an alternative.  A hundred bucks isn't much to me when my average rent is $1,500.

Tod R. · Answer

My initial thought on a number was $50.  As long as you are complying with your lease, you technically owe nothing.  That being said, I agree that you should work with a good tenant.

Cheryl C. · Answer

I think that giving them $100 off their rent is fair and will do wonders for goodwill.  I had new tenants move in and the brand new hardwood started to buckle and come up.  This was clearly my contractors screw-up, but it was a full week of inconvenience and I credited them $500 on their $1500 rent.

Inconvience discount for broken refrigerator?

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