Investor · Philadelphia, PA · Member since 2015 · 9 posts · 1 vote
Hi Everyone!
I apologize if this topic has been discussed previously as I would imagine others have had the same issues. I have current tenant who is unemployed due to Covid. He does AV project work for large companies. He has been a great tenant for the last 2 years and wants to renew the lease for a 3rd year. If we were in normal circumstances it would be a no brainer. My concern is that I am unsure he is going to be able to land another high five/low six figure job in the near future given the nature of what he does.
I figured I wasn't the only landlord experiencing this dilemma. So would you renew the lease and hope unemployment benefits continue and he is eventually able to find a new job or do you try to find a new tenant?
I recently acquired a property where I encountered the same situation on 2 different units. I opted to keep both because they have been very good tenants and in NJ it is not too difficult to evict people if necessary. Additionally though, what put my mind at ease about making my decision, was know that they are typically good tenants and I was okay with the worst-case-scenario of no rent and a three month eviction process for each. My rent roll excluding the two units rent would have been still sufficient to cover my expenses.
Ultimately, I would say base your decision on the worst case scenario and are you willing to accept that risk based on your current financial standing.
I agree with the two above. You could be getting rid of a great tenant based on a hunch, and replacing them with either no tenant for a while or a bad tenant. He took care of you for two years, give him the benefit of the doubt.