What would you Landlords do?

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What would you Landlords do?

Wilson Lee
Investor · Indio, CA · Member since 2016 · 13 posts · 0 votes

Greetings fellow landlords. Multi unit was purchased a few years ago. Inherited a tenant that already had 2 adults and 3 small children living in a small 2b1ba house. What should we do if the tenant was expecting a 4th? Not that we'd kick them out during this pandemic, but just wanted to get some wisdom on what should or can be done?

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Damaso Bautista
Rental Property Investor · Hawthorne, CA · Member since 2018 · 655 posts · 900 votes
5y

@Wilson Lee

If they are paying the rent on time and the rents are at market, I would leave them alone. 

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  • Damaso Bautista
    Rental Property Investor · Hawthorne, CA · Member since 2018 · 655 posts · 900 votes
    5y

    @Wilson Lee

    If they are paying the rent on time and the rents are at market, I would leave them alone. 

    14Reply
  • Holly Davis
    Member since 2020 · 3 posts · 5 votes
    5y

    I guess my first question is, what is your specific concern?  That too 6 tenants in one unit like that (including eventually 4 kids) will do more damage to the place than the existing 5 tenants?  So the concern is damage/wear and tear?  Or what?  Also important consideration would be whether they are good tenants thus far-- respect the property, pay on time, quiet enough not to bother their neighbors, etc?

    4Reply
  • Theresa HarrisPro Member
    Member since 2019 · 15k+ posts · 11k+ votes
    5y

    Not much you can do unless there is a problem.  I can't see how all of those people would fit in a house, but that is their choice.  If you say anything, you will be told you are discriminating though I am sure there are guidelines on how many people can live in a 2 bedroom house.

    2Reply
  • Wilson Lee
    OP
    Investor · Indio, CA · Member since 2016 · 13 posts · 0 votes
    5y

    Good tenants. Only concern is wear and tear on 1 toilet, water, plumbing, etc. Not really sure if 1 soon to come baby will do much damage for a few years anyway. Not to be a grinch, but just trying to get a birds eye view on a ton of people living in a small area. 

    Any tips on how to futureproof this poor toilet/bathroom/plumbing situation?  

    Also, aren't there provisions in a lease that say how many people can live at said property?

    0Reply
  • Wilson Lee
    OP
    Investor · Indio, CA · Member since 2016 · 13 posts · 0 votes
    5y

    Question 2: Would you raise rents at this time considering now we're only allowed to raise 5% annually.

    0Reply
  • Holly Davis
    Member since 2020 · 3 posts · 5 votes
    5y

    Again I think this goes back to several of the other comments. Is this a reliable tenant, who pays on time that you want to retain? If so I would be deferential to them, and don’t do anything to chase them out. I would suggest increasing your rents on the normal schedule you would regardless of the new baby, If this is a tenant you want to retain.

    1Reply
  • Damaso Bautista
    Rental Property Investor · Hawthorne, CA · Member since 2018 · 655 posts · 900 votes
    5y

    @Wilson Lee

    Question 2 is a reasonable one.  This is a personal business decision that you need to make based on your business plan.  I never fault anyone for following their plan.  

    If in your plan you can raise the rents based on what the market will bring then go for it.  The market will dictate how much you can charge for rent.  

    I will reiterate if they are good tenants who pay on time like you say, I would leave them alone. 

    0Reply
  • Jonathan Shambare
    Member since 2020 · 1 post · 0 votes
    5y

    This is anecdotal. I thought you can't limit the number of people in a rental unit. I also have heard HUD may have some regional recommendations.

    0Reply
  • Wilson Lee
    OP
    Investor · Indio, CA · Member since 2016 · 13 posts · 0 votes
    5y

    Thanks to all for their valuable input.

    0Reply
  • Chris John
    Member since 2020 · 671 posts · 937 votes
    5y

    @Wilson Lee

    Buy them a cigar?

    5Reply
  • Owen DashnerPro Member
    Lender · Omaha, NE · Member since 2008 · 1k+ posts · 1k+ votes
    5y

    Check your HUD and Fair Housing laws/guidelines and be mindful of saying anything discriminatory (commenting on number of children, asking if they'd be happier elsewhere, etc.).

    https://rentprep.com/tenant-sc...

    2Reply
  • Peter Anderson
    Real Estate Broker · Stamford, CT · Member since 2016 · 66 posts · 33 votes
    5y

    @Wilson Lee your local municipality probably has guidance on overcrowding. In our market we permit two people per bedroom. An infant is not considered ‘eligible’ in the headcount until they are 18 months old.

    Suggest contacting them to tactfully inquire about their plans.

    2Reply
  • Jim K.
    Handyman · Pittsburgh, PA · Member since 2018 · 5k+ posts · 13k+ votes
    5y

    If you provide a washer and dryer on the premises, prepare for it to lose at least an extra year of life expectancy in 2021.

    0Reply
  • Xela Batchelder
    Member since 2020 · 49 posts · 40 votes
    5y
    Originally posted by @Jonathan Shambare:

    This is anecdotal. I thought you can't limit the number of people in a rental unit. I also have heard HUD may have some regional recommendations.

    Yes, I just came across this today while researching HUD. For each bedroom, there was a minimum and maximum number of people in a HUD house. I was thinking of Joe Asamoah's 5 bedroom section 8 houses and happened to remember a 5 bedroom needed a minimum of 8 and a maximum of 10.

    Found it again:

    "Here is a reference table used by Housing Authorities across the US to determine how many people can live in a unit. Also, the table has both minimum and maximum guidelines for occupancy, which are set forth to avoid cases of fraud."

    https://section8facts.com/sect...

    Also ran across this trying to refind that chart above:

    What Is IPMC?

    IPMC, also known as the International Property Maintenance Code, includes a set of more specific occupancy rules. These rules are used whenever state and local laws do not give enough regulation to occupancy or when the state and local rules do not apply because of the Fair Housing Act.

    The rules set out by IPMC are more specific that many other regulations:

    • All bedrooms with one person should have at least 70 square feet.
    • Shared bedrooms must have at least 50 square feet per person.
    • Kitchens and other non-habitable rooms cannot be used as a bedroom.
    • Every unit should have an overall occupant limitation based on its overall size:
      • 1-2 occupants: must have at least 120 square feet living room
      • 3-5 occupants: must have at least 120 square feet living room and 80 square feet dining room
      • 6 or more occupants: must have at least 150 square feet living room and 100 square feet dining room

    https://rentprep.com/tenant-sc...

    1Reply
  • Michael Robbins
    Property Manager · Henderson, NV · Member since 2018 · 501 posts · 317 votes
    5y

    potentially limiting number of occupants in a home related to someone having an additional child could end up being a fair housing violation. Familial status. My understanding is it is not specified but HUD does offer some guidelines.

    0Reply
  • Jill F.
    Investor · Akron, OH · Member since 2016 · 2k+ posts · 4k+ votes
    5y

    I'd just keep collecting the rent.

    1Reply
  • Marian Smith
    Real Estate Investor · Williamson County, TX · Member since 2011 · 1k+ posts · 961 votes
    5y

    @Wilson Lee No shared walls to bother anyone else. Are you wanting a reason for them to leave so you can rehab and raise rent? Not sure you can limit occupancy beyond 4 anyway so you may jump out if the pan into the fire. Besides, we are expected to enter crisis mode after the new year here..covid. Are you planning on being around for the rehab and interacting with workers? I would be patient and let it sort itself out over the next year or so. And read a Stephanie Plum /Janet Evanovich novel, pretty funny. Character talks about growing up in a small one bath with siblings and grandmother in New Jersey. The whole neighborhood was the same. Everyone used to live cramped up, one car, etc. so it is doable.

    0Reply
  • Linda S.
    Investor · Richmond, VA · Member since 2016 · 1k+ posts · 2k+ votes
    5y

    @Wilson Lee,

    We had a nearly identical situation, a 2bd, 1 bath SFH, originally just an older lady and her brother (2 people).. but then.. she moved in her daughter, and her 3 kids, so now a total of SIX ( 6 ) people using ONE toilet! She decided to stop paying, so I looked into getting rid of her based on a compliance violation.

    Check your local inspector, but if people are RELATED-- the rules are different. In VA, the code compliance pretty much said 6 people wasn't an issue, as there can be 2 sets of bunk beds, people can sleep on the couch, it was an odd learning experience! I'd confirm with the code compliance BEFORE saying anything to the tenant!

     If they are good tenants, I would try and get them to move into a 3 or 4 bd home instead, or just raise rents each year. 

    0Reply
  • Alex Heidenreich
    Investor · Columbus, OH · Member since 2020 · 55 posts · 64 votes
    5y

    @Linda S.

    I would agree with this. You can get in deep water even commenting on kids in the house. You need to know the codes and see if there are limits. Possibly consult with an attorney to know the laws and ensure you are not saying anything that can get you into trouble. On the other side, you also want to ensure you/they are not violating code by having too many people occupy the premise.

    1Reply
  • Amy D.
    Investor · Clinton, MI · Member since 2018 · 17 posts · 7 votes
    5y

    @Wilson Lee let it be for now. It won't be long and they'll be moving themselves out. I would increase the rent as usual. Put break resistant stuff in the house, easy to clean traps, and I'd make sure to do regular visits to watch the cleanliness factor.

    0Reply
  • Alexander Szikla
    Real Estate Agent · New York City · Member since 2020 · 819 posts · 640 votes
    5y

    This unit is going to have a lot of "wear and tear" 

    0Reply
  • Greg Carrier
    Investor · Granger, IN · Member since 2015 · 195 posts · 129 votes
    5y

    @Wilson Lee we will see if we have something else for them to move into. Or give them notice and tell them they’re going to need to find a different place to live. We just were six people and a large dog out of a Small two bedroom in the last month or so. I know that large families go to small houses 50+ years ago but I don’t want to wear and tear on something that small being used by so many people.

    0Reply
  • Tyler Brown
    New York City, NY · Member since 2015 · 125 posts · 48 votes
    5y

    While we all have our opinions on whether or not we'd rent a two bedroom to six people, making any decision based off soley that factor is treading dangerously close to discrimination based off of family status, which is a protected class outside of a few exceptions.

    Unless your local municipality has a ordinance regarding the maximum occupancy (based either on number of bedrooms, or square footage) that they're violating, you're hands are pretty much tied, at least until lease renewal time.  This is why any attorney will always advise to never give a reason when electing not to renew a lease.

    For what it's worth, as long as no neighbors are complaining and they're otherwise good tenants, I wouldn't worry about it.

    0Reply
  • Joe SplitrockPro Member
    Moderator
    Rental Property Investor · Sioux Falls, SD · Member since 2015 · 9k+ posts · 18k+ votes
    5y

    @Wilson Lee occupancy standards will vary by state and city, but generally speaking 2 per bedroom plus one is the rule of thumb. The plus one is living room fold out couch type situation. Also be aware babies are treated differently, because they can be a third in the parents bedroom. You can use occupancy standards when screening people coming in, but once a family is there, good luck asking someone to leave for having a baby. There is no way you could enforce that.

    My advice is increase rent the 5% you mentioned was the maximum allowable. There will be extra wear on everything. More people is always more wear, which means more repairs over time.

    1Reply
  • Wilson Lee
    OP
    Investor · Indio, CA · Member since 2016 · 13 posts · 0 votes
    5y

    Great discussion and appreciate the amazing input. 

    0Reply
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