How to overcome emotionally difficult tenants?

44 Replies

@Jennifer Gligoric Thanks for explaining the finer details of agreements.  I think you're right, if I'm not expecting to become an expert in property management, I should hire it out.  

For everyone wondering why we verbally agreed on quarterly inspections...my plan was to start there as this is my first SFH that I'm managing and the value is high. Many of my "eggs" are in one basket so to speak, but this is simply the condition of my market in which I live. I desire and fully expect to transition to inspecting twice a year or ideally once a year with a trusted tenant, but given my lack of experience wanted to be sure the house is in good condition. The quarterly inspection is not for all properties for all time, it's simply a stepping stone to ensure we're all good on this large investment. This is more important than a tenants feelings.

I have a background story to add on a family members rental property. I witnessed a transfer of ownership after a death in the family to a family member that did not want it and was not equipped to manage, but rented it out after a small rehab. The tenant completely destroyed the house inside of 6 months and it was not inspected once during that time. Only after the tenant fled the state was it discovered the extent of trapped animal damage (horrific to say the least). Then it sat empty for years. The point is that I witnessed what a new tenant can do to your property. You might say "lesson learned" for the owner of that property, but if it happened on my SFH in California it would be a giant set-back if not the end. That said, I agree that it does not need to be ME who inspects or stops over for a routine job.

@Matt Mainini Good luck and I think everyone will understand your strong motivation in enacting due diligence when it comes to ensuring your investments have the best chance of success. We've all had or witnessed tenant horror stories but I'd caution against letting that experience, mismanaged as it was, color your actions now in a way that is stressful or worse might inadvertently open you up to a breach of contract or breach of quiet enjoyment suit. At $10k a person (if there is more than one person on the lease) it can add up. In San Francisco & Oakland, breach of quiet enjoyment in bad faith if proven can triple damages.

Good luck & maybe do an inspection every 6 months and call it Spring & Fall seasonal checkups and write those into the lease and get them to initial, sign off on it - and give the right written notice would be a compromise until you get more comfortable with your ability to vet and place good tenants.  

Bryan Devit....oh my god....... CA is not over run with rats....give me a frickin break. You need to check the sources of info you get.

Lived in CA my whole life..... NO ONE I know is over run with rats...... just like everywhere else, there can be issue from place to place based on the neighborhood and food sources etc...no different that any other location...

I definitely feel that Santa Cruz CA has an ongoing rat problem.  As I've had many opportunities to walk through homes on the market, some selling north of 1 million, almost every time I open the crawl space door I see rat traps everywhere.  It would be interesting to hear from a realtor or investor in the area that has more experience.  I've been told by multiple realtors that "every house has them".  Obviously that must be an exaggeration, but many of my friends are fighting them and I've heard a few stories of chewed up wires in vehicles because the rats are attracted to a certain type of wire sheathing that some auto manufacturers use.

Some people have a harder time dealing with confrontations. It seems like you are letting the offensive remarks bother you (you had nightmares and you don't deserve that). My best advice is to outsource the confrontational part to someone who is very comfortable with offensive remarks. I did this for one of properties in a tougher neighborhood and it worked out great. You will become more immune to this over time. Trust me, I've been there and I handle this type of situations much better than when I first started. I learned a lot from my property manager's "no non-sense approach".

Originally posted by @JD Martin :
Originally posted by @Bryan Devitt:
Originally posted by @JD Martin:

Thoughts:

2. I would be appalled to have rats underneath a $90k house, much less a $900k house. What kind of a/b neighborhood is that that has enough rats for you to find 3 under the house?

It's CA, there are rats everywhere. Podcasts I listen to with very rich people and nice houses complain about the rats going through their yard or making a house in their chicken coupe. I don't get it, but I guess you just get used to them like squirrels 

 

That's freaking crazy. I just can't see rats in a 900k neighborhood, but maybe with California's insane priced-out market 900k is a rat-infested neighborhood! I've lived in 8 different states and been to a lot of places (US Navy) and I never saw a clean place that was rat-infested. I lived in some areas that had a lot of rats, but the neighborhood was a slum. 

 

Can confirm, in both the Bay Area and LA, there are plenty of neighborhoods which have few or no homes under $1MM, but still have rats around. It's not a big problem, and the amazing weather and quality of life more than make up for it (in LA at least).

Originally posted by @Matt Mainini :

@Jennifer Gligoric Thanks for explaining the finer details of agreements.  I think you're right, if I'm not expecting to become an expert in property management, I should hire it out.  

For everyone wondering why we verbally agreed on quarterly inspections...my plan was to start there as this is my first SFH that I'm managing and the value is high. Many of my "eggs" are in one basket so to speak, but this is simply the condition of my market in which I live. I desire and fully expect to transition to inspecting twice a year or ideally once a year with a trusted tenant, but given my lack of experience wanted to be sure the house is in good condition. The quarterly inspection is not for all properties for all time, it's simply a stepping stone to ensure we're all good on this large investment. This is more important than a tenants feelings.

I have a background story to add on a family members rental property. I witnessed a transfer of ownership after a death in the family to a family member that did not want it and was not equipped to manage, but rented it out after a small rehab. The tenant completely destroyed the house inside of 6 months and it was not inspected once during that time. Only after the tenant fled the state was it discovered the extent of trapped animal damage (horrific to say the least). Then it sat empty for years. The point is that I witnessed what a new tenant can do to your property. You might say "lesson learned" for the owner of that property, but if it happened on my SFH in California it would be a giant set-back if not the end. That said, I agree that it does not need to be ME who inspects or stops over for a routine job.

I understand your experience has left you nervous, but the fact the house wasn't inspected isn't why it was trashed. It was trashed because an inexperienced landlord didn't properly screen the tenant. No well screened tenant would trash a property and leave the state. And no experienced landlord would let a property sit vacant. I have had places totally trashed and they were spotless with a new tenant in less than 30 days.

It sounds like you have good tenants. A young family could stay in your home for years. I am not sure why you are so intent on driving them out. Vacancy is a far greater expense in rental properties than damage.

@Matt Mainini were was the lady’s husband? You are setting yourself up to be accused of insulting his wife or worse. This may sound old fashioned to you, but I don’t meet a lady without someone with me if they are alone and for that matter it not likely for me to go on an appointment of any kind without my wife or one of my children with m. Yes I know some people do it all the time and nothing comes from it, but it only takes one false accusation to do great damage. 

Originally posted by @Joe Splitrock :
Originally posted by @Matt Mainini:

@Jennifer Gligoric Thanks for explaining the finer details of agreements.  I think you're right, if I'm not expecting to become an expert in property management, I should hire it out.  

For everyone wondering why we verbally agreed on quarterly inspections...my plan was to start there as this is my first SFH that I'm managing and the value is high. Many of my "eggs" are in one basket so to speak, but this is simply the condition of my market in which I live. I desire and fully expect to transition to inspecting twice a year or ideally once a year with a trusted tenant, but given my lack of experience wanted to be sure the house is in good condition. The quarterly inspection is not for all properties for all time, it's simply a stepping stone to ensure we're all good on this large investment. This is more important than a tenants feelings.

I have a background story to add on a family members rental property. I witnessed a transfer of ownership after a death in the family to a family member that did not want it and was not equipped to manage, but rented it out after a small rehab. The tenant completely destroyed the house inside of 6 months and it was not inspected once during that time. Only after the tenant fled the state was it discovered the extent of trapped animal damage (horrific to say the least). Then it sat empty for years. The point is that I witnessed what a new tenant can do to your property. You might say "lesson learned" for the owner of that property, but if it happened on my SFH in California it would be a giant set-back if not the end. That said, I agree that it does not need to be ME who inspects or stops over for a routine job.

 I understand your experience has left you nervous, but the fact the house wasn't inspected isn't why it was trashed. It was trashed because an inexperienced landlord didn't properly screen the tenant. No well screened tenant would trash a property and leave the state. And no experienced landlord would let a property sit vacant. I have had places totally trashed and they were spotless with a new tenant in less than 30 days.

It sounds like you have good tenants. A young family could stay in your home for years. I am not sure why you are so intent on driving them out. Vacancy is a far greater expense in rental properties than damage.

I appreciate your business-first thinking Joe.  It's helpful to see your perspective as I try to mentally shift toward a thought process more aligned with success :)

I am so sorry you have to deal with that.  I know you mentioned there is no room for property management.  I don't know California law, when is the next opportunity to modify the lease?  Do you have the option to not renew your lease?

@Matt Mainini   If the lease says quarterly inspections, then they agreed to it.  My insurance requires inspections twice a year (or visits to the house).  It lets you check smoke detectors and furnace filters plus gutters and other things.  I'm sure you have a check list, so give it to them ahead of time and they will know what you are looking for.

@Matt Mainini If I were a professional and renting in good asset class area, I would want you to stay out of my way as well, especially 2 weeks after having a child. You’ll need to figure out what assets you need to hawk over and which ones you give tenants some rope.

You lost me at the story about finding 3 rats and getting rid of them, like this just happened to happen in an afternoon.  I'm not buying your story.

Rats aren't a problem in Santa Cruz and even if you had a problem with rats, which I did have a million years ago on a rural property in WA, you sure couldn't just get rid of them in an afternoon.

So, for someone who's been around the block, I don't buy your story.

@Matt Mainini

Totally understandable since you’re a “newer” investor (if I understood correctly) with much to learn.

However, I'd leave well enough alone. Don't be a helicopter landlord. Follow the lease. I have over 100 units and with that comes 100+ different personalities. Some will get under your skin. At the end of the day you gotta realize it's business. And in any business the main thing above all other things is how you handle people. My wife and I recently had a baby and there's all kinds of different "momma bears." Sounds like this one is pretty private, possibly on edge from lack of sleep (you may have walked in and through her whole house after she finally got the baby down or through some kind of stressful fit). Don't take it personal. If she says she knows how to handle a home make her price you wrong. If it were me I'd pick up rent or have the tenant send electronically and until they missed a payment they would be on auto-pilot. I invested in real estate because I wanted to work less not more. So causing problems for my tenants and having to unravel issues is not my ideal way to spend an afternoon. Let alone going home to let said tenants attitude keep me on edge while I'm at home with my family.

Outside of that I’d buy more stuff you didn’t mind someone renting. You’re emotionally attached to this property which might hinder you from keeping business as business.

Keep trucking.... everyone has to learn different things different ways. I’ve got a couple tenants who are driving me absolutely nuts at the moment. Both are in the process of being evicted but the amount of rent not collected seems to be eating at me.

If the tenant acting like this is a one time thing then you probably just caught her on a bad day, a really bad day. Also, if you are at the point where you are having nightmares and stressing over a tenant I would suggest not even putting yourself in this situation again. Hire someone local to do your quarterly inspections and have them report to you what the findings are. Personally I have never understood the quarterly inspection strategy, but if you think it is important I'd figure out a way to do it that is less stressful for you. 

3 rats under the house is really low on the list of problems you can have with tenants. If the place is well taken care of and they're paying rent on time..I wouldn't worry about it. If your wanting inspections every 3 months, that should be in writing on the lease.

Originally posted by @Michael Noto :

If the tenant acting like this is a one time thing then you probably just caught her on a bad day, a really bad day. Also, if you are at the point where you are having nightmares and stressing over a tenant I would suggest not even putting yourself in this situation again. Hire someone local to do your quarterly inspections and have them report to you what the findings are. Personally I have never understood the quarterly inspection strategy, but if you think it is important I'd figure out a way to do it that is less stressful for you. 

Agreed completely Michael.  Thanks for explaining clearly what my next steps are!

 

What you’re doing is not legal in CA. Read my original post. You could get sued by your tenant, and they’d have an easy case against you in tenant friendly CA courts. 

@Matt Mainini   I would be inclined to sell and get the owner occupant exclusion but I see your strategy.  My thought was how could you cash flow at 900k.  

Even though you  are also going over to see how the tenant is keeping things you have to convey I am trying to keep the house in the best shape for them so they don't get unexpected issues. At your class of rental you are probably always going to have some high maintenance tenants.