Targeting the 60+ Year-Old Renter - Good Idea, Bad Idea?

24 Replies

A fellow investor recently said to me, "I want a 60 year old renter because they're stuck in their ways and I want them to be stuck in my home." 

If this is the target renter, you'd have to have single-story homes without stairs, which is certainly something to think about before buying. With the 60+ population growing as baby boomers get older, this could be a fairly good strategy at first thought. 

Curious to learn what others think of this concept. Please share!

It's funny that you say that. I was talking to a friend just yesterday that self manages. One of his properties is rented to an older couple, they are beyond 70 though. My friend receives all types of calls at late hours for things like changing out light bulbs that the couple is just physically unable to do. My friends wife suggested to have the tenants wife do it, to which my friend replied, "sure, have the 75 year old woman standing on a chair to change it." He has to do everything like that. Air filters, forget about it. He charges them an extra $10 per month to stop by once a month and change the filters.

It is just a different type of tenant I think. That being said, everyone has their niche and that may be worth looking into. 

My best renters are retired people with family in the area. They never leave and they take good care of the place Having family around is their financial backup and the relatives help with housework.  These days 60 can still be pretty mobile.  Worst renter is young gal with baby and new boyfriend. 

@Abby Carr Well, a couple of things, you really can't discriminate so you can rent to someone because they're old.  But you could posit that ranch homes with a single story could be more attractive to an aging population and demand a premium.  You could also end up having an emotionally hard time evicting "grandma" if she's on a fixed income and you own a property in Newport Beach where rents are going up.  How you handle that is probably for you to decide but best to think about going in.  Maybe you'll end up on the local news as a "heartless profit-seeking landlord".

And, you do have to think through 'What happens if they die in the house?'  Sure, there's the "oh, that's sad" moment but in some states you have to disclose the death for a certain amount of time as well as the manner in which it occurred.  The unpleasant reality is that that spooks some of the tenant population.  Maybe not another 60+ year old tenant but it can impact rentability.   

@Kyle Beauchamp - hadn't considered that in the conversation we had... good point. Thank you for the insight. I guess if you'd like to have some kind of 'additional care' package as an option on the rent agreement it'd be a way to squeak some extra money each month, but may not be worth the hassle.

@Richard Heine - the reliability of the person you mentioned who has family nearby is exactly what I was thinking, the trouble is how do you go about finding out if they have family nearby and such...? I'm sure there's a way - there's always a way - but to do so without discriminating as @Andrew Johnson mentioned is another obstacle. 

"heartless profit-seeking landlord" made me laugh, that's certainly not what I'm thinking with this strategy, but the points you all make are very helpful and worth considering. 

Thank you all! Still interested to hear and learn more thoughts of others, especially if someone's ever run into the issues that Andrew mentioned and what results they ended up with...

On the application, the older people that are good prospects (and young people in distress) tell you their life story. TNI. Some times I get four paragraphs. You don't have to break any rules in the advertising process. The app will tell you.

I can't wait to see you on local news @Abby Carr when you're booting an invalid out of the Newport Beach home she's been renting from you for the last 7 years on a fixed income :-)  

j/k...maybe...

Aside from the obvious discrimination, this really isn't a good idea.

The premise is 60+ year olds suffer more from complacency than other age groups

first off, got any proof? or does it just SOUND good and it's backed by anecdotal "research"

secondly, you think old people can't be lousy tenants? or that young ones are better tenants? What if you're complacency hypothesis is correct, old people don't change.....and your tenant is an *******, you want to be stuck with that guy? You think old people can't be ******** too?

People are complex, unique, and ever changing, to say one demographic has some explicit benefit to a business over others is short sighted. like @Andrew Johnson said, you want to evict grandma in December when the time comes? or deal with changing light bulbs all the time? People can be easy, or they can be difficult, and people of ALL AGES SUFFER DRAMATICALLY FROM COMPLACENCY. Discrimination laws help EVERYONE, because people will sometimes discriminate against their bests interests, Like your fellow investor imo.

I would suggest to use the tried-and-true model of most property owners = rent to the best candidate regardless of age, sex, color, religion, etc.

Originally posted by @Abby Carr :

A fellow investor recently said to me, "I want a 60 year old renter because they're stuck in their ways and I want them to be stuck in my home." 

If this is the target renter, you'd have to have single-story homes without stairs, which is certainly something to think about before buying. With the 60+ population growing as baby boomers get older, this could be a fairly good strategy at first thought. 

Curious to learn what others think of this concept. Please share!

 Equal housing opportunity - however, once someone told me many years ago when I was looking at large multifamily in a low-income neighborhood, if you redo the building you should also market as a 65+ - because they stuck in their ways, because they wont ruin your place - I don't know never tried, I just concentrate on being thorough with whom we are placing, if you are patient and disciplined you can be rewarded by simply being diligent. 

@Abby Carr   I completely agree with @Kyle Beauchamp .  If you are going to provide housing in hat niche I would do so with a multifamily or in a condo in a complex with older tenants or owners already.   We have run into issues with grandchildren moving in that have not moved out after grandma or grandpa passes away, so you could get stick with an unwanted tenant.  Also not to stereotype but can't tell you how often we go into homes with elderly tenants where they have no idea the place smells.

@Abby Carr I currently have a tenant that is 84 years old with no disabilities. She has family that lives within 5 miles and goes out of their way to help her. I have not had any calls to change lightbulbs or any of the other things mentioned by the others.

The property just had a complete rehab and she was the first renter, so there was really not a thing wrong with the place. When she first rented the unit, I suggested to install a grab bar in the shower which I did. A week later, she then called wanting to add a ceiling fan and to change out the exterior lights on the property. I responded that I didn't install ceiling fans in any of my units and that the lights out side were functional and provided adequate lighting. I mentioned, that if she wanted these items, it would be a tenant requested improvement and she would have to pay for it with the understanding that she would have to pay to restore the unit to the original condition when she moved out. Well, she agreed to pay and I hired the contractor to come out and install the items.

Fast forward, 6 months of market rate rent and utilities being paid on time and I get another call for an improvement. Ok, so what's up now I think. She wants a walk in shower installed. I remind her, that this is a tenant requested improvement and she understands and is willing to pay for the improvement.

Initially, I was thinking of having a fiberglass shower surround installed so I went out and got some bids for this. I returned the information that it was going to be around $3500-3800 to install this. Knowing that the fiberglass surround was somewhat of a downgrade to the existing finishes as the place has quartz counters and new cabinets etc...

I mention to her that I wasn't a big fan of the fiberglass insert and her reply about floored me. Turns out that she isn't either and would rather have tile installed. When I mentioned to her that the price would immediately jump to around 6k, she replied, well, I don't really want to pay 10k for a shower, but get another estimate.

Wow, I thought this is fantastic. I have a tenant that is willing to pay for significant upgrades that will greatly enhance my property value.  I immediately scheduled an appointment for a contractor to come out to measure and give me a quote for the installation. Now I don't yet know what the final outcome will be, but I can assure you one thing. If the bid goes through, I have a good paying tenant that is going to be there for a long time which is our goal.

While I agree, this is somewhat unusual, I am liking my older tenant at this point. She pays on time, is paying market rate and is willing to pay for improvements to enhance her living space. It seems possible that people of this age could be willing to do something like this so that they can live out their remaining years in someplace they like with the finishes they like.

I will provide updates after the bid comes in. Until then, fingers are crossed hoping for a reasonable bid and approval from the tenant.

What in the world Ted Klein that is a crazy story! Please keep us informed I’m in dying to know what happens.

As for the OP question I had actually thought of that but got worried about the tendency that older folks have of not keeping house as well and not smelling things when they are “wrong.” I want people who can really maintain and look after my properties well and I don’t think 65+ is it (or rather 75+ because let’s face it 65 ain’t that old!)

Thanks for all the interesting replies, a good conversation to be having I'd say. Like most things, I guess it comes to some pros, some cons - pick your poison. 

I'm surprised no one mentioned the accessibility (or non-accessibility) of a home purchase as a way to attract or deter older tenants. I figure there's certainly some ways to deter an older tenant (e.g. live in a place that gets ice in the winter and have 5+ steps up to the front door) that some might consider given the complaints of some of the folks above about things like "smell" and repair requests they've seen from older tenants.

Nonetheless, here's to hoping we all get the dream tenants like @Ted Klein 's appears to be, regardless of their age.

Lots of good info on both sides here. Not to hijack the thread but I learned a long time ago When buying, selling, or doing anything substantial with an older person, get some family buy-in.  Family members think everyone is out for grandma's money. I even look for buy-in if the people are early twenties for a sale. 

Also, if granny doesn't have the greatest numbers, the kids will step up and co-sign a lease. It's a Dave Ramsey no-no but everyone does it.

I only have 5 rentals currently so my view is different than someone who self manages 50-100+. I initially had mostly single women tenants (40-60 years old) when I started out and it spoiled me. They kept the property clean and did not try to fix (or rig) anything that was broke. They called me for any small issue they knew of. As the market increased, I consistently improved the property, and increased rent. I now target young adults with good jobs. They can afford the top of the market rent for my properties yielding the most cash flow. They rent to move every 2-3 years allowing me to improve the property and raise rent. If I had 50 doors, I might have a different strategy.

Awhile back at a real estate meet up, I was talking to a guy about the Phoenix market and he said he had been investing there but was pulling out. He did mention that he had an acquaintance who was continuing to invest there, and whose niche was to target the retiree tenant. According to him, these types tenants had a tendency to rent until they either need it to move to assisted living or died in the home. His acquaintance had some tenants who had been there for 10 to 15 years.

There are a lot of homes in the Phoenix area with SFHs and townhomes that are in neighborhoods with age restrictions—like 55+ communities. If I was understanding this person correctly, I think it was fine for the owner-landlord to be under 55 as long as the tenant was 55+. (Don’t quote me on that though, I’ve never looked into it myself!) If that is the case though, and you were interested in this niche, maybe homes in those age-restricted communities would be a good area to target.

@Andrew Johnson age discrimination probably falls under familial status, but fair housing does have exemption for "over 55" communities. It wouldn't apply to a single family home. As you pointed out, buy a property that has the amenities that attract your target renter would like. Single level living is a big one. Two bedrooms will limit the appeal to families. 

@Abby Carr In my experience seniors are great renters. They have lots of free time to take care of the property. There is an aging population that wants to down size and avoid maintenance, so I agree this is a good strategy.

Completely anecdotal, but to this point my worst renter was a single 67 year old woman. She complained about everything. On the plus side, she did keep the house neat. She ended up moving because she didn't like the way heat pumps work. Since there's no natural gas at that location, the only other realistic option is baseboard heating. She didn't like the fact that the air doesn't "feel" hot coming out of the vents, which is the way a heat pump works; it's a slow heat but an economical and even heat. 

@Abby Carr ,

While initially I thought about how much I love my older tenants, especially ones on fixed income so there's no question if rent is coming.. she takes A+ care of the place, never complains, and is very savy... but then i remembered, a prior tenant, who complained a lot about the heat, a lot about cosmetic stuff.. and later passed away, so yeah... just like young people, it's 100% dependent on the person, so I don't know if I'd only focus on senior citizens..   I've seen young tenants who are very astute and others who are shockingly ignorant, so it all boils down to individual tenants IMO.

@Joe Splitrock Thanks Joe, is the exemption for "Over 55 Communities" or just people over 55?  I could just imagine the scenario where the young couple with a better W2 doesn't get chosen over granny with a social security payment and make the argument that (on paper) they are a better qualified tenant.  I'd imagine this is the 1/10th of 1% hypothetical but you never know.  I personally don't market (or not) to any particular group so it's more of an intellectual curiosity to me.  

I know I have a couple of 55+ renters in my apartments but that's far more coincidental than anything else.  Most are the "townhome" style units so stairs don't exactly make it "friendly" for tenants that might have a challenge walking.  If we were trying to appeal to that demographic I'd probably look for smaller yard, stay away from properties with pools, buy something close to grocery stores, etc. 

Originally posted by @Andrew Johnson :

@Joe Splitrock Thanks Joe, is the exemption for "Over 55 Communities" or just people over 55?  I could just imagine the scenario where the young couple with a better W2 doesn't get chosen over granny with a social security payment and make the argument that (on paper) they are a better qualified tenant.  I'd imagine this is the 1/10th of 1% hypothetical but you never know.  I personally don't market (or not) to any particular group so it's more of an intellectual curiosity to me.  

I know I have a couple of 55+ renters in my apartments but that's far more coincidental than anything else.  Most are the "townhome" style units so stairs don't exactly make it "friendly" for tenants that might have a challenge walking.  If we were trying to appeal to that demographic I'd probably look for smaller yard, stay away from properties with pools, buy something close to grocery stores, etc. 

It is the over 55 communities. So if you had an apartment, it would need to be uniform in the building. I am not sure how much age discrimination really goes on. I don't care as long as people pay their rent and take care of the property. I guess it is like college rentals, theoretically a family could rent a house on frat row, but why would they want to.

I rent primarily to retirees and widows/widowers. You still must screen carefully but they are the quietist and most cooperative tenants. Mine do not make demands and do not cause trouble or damage for the most part. If you prefer long term tenants they will stay till they die (common occurrence) or till their family moves them to a home. You do end up losing a lot of work time chatting and having coffee and cookies with them though.

I do not discriminate (openly) I just pick the best applicant. It just so happens I think seniors are the best applicants. Funny how that works out.

The majority of my properties on one of my companies primarily has older tenants. Didn't intend this but like many have said they filled the app out entirely and showed up for a showing on time. Was respectful and had all their paperwork. I've been renting to them for that 4 years and it's great. I have some even pay online! The others either set up direct deposit or mail it in. 

The only con I can toss out there is most want to mail their money which forced me to get  PO box. Wasn't the end of the world but just another stop I have to make on the 1st of each month. 

I recently had tenant pass away (in the hospital). Process went very smooth and the family got his things out quicker than I expected. The only thing I would recommend is putting a beneficiary on the lease for the deposit and have them give you multiple points of contact with their family. Wasn't a big deal b/c of the family, but it clears things if something happens and you need to reach out. I'm in NC and my attorney said it should go to his estate OR the person that is related to him that I have contact with. Just so happen to be his brother and at that point the responsibility  falls on his brother to put it in the estate ( if there is in). If you have a beneficiary it can help to clear up who gets the deposit but again it's best to let an attorney guide you. 

Most of mine draw some sort of retirement check so the security of guaranteed income is nice as well.

Good luck to everyone!

@Heidi Wilson @Abby Carr @Richard Heine @Steven Gesis

Well I think I owe the BP community an update. I talked to the tenant and her son to determine what level of finish they were wanting in the apartment so as not to be seen as taking advantage of the tenantwent out and got a

Updated 6 months ago

Sorry but the post accidentally posted before I was finished. I will finish the update below

@Heidi Wilson @Steven Gesis @Thomas S.  

Well I think I owe the BP community an update. In a previous post on this thread, I explained how my tenant wants to pay for a remodel to the shower in their unit. @JD Martin Since she is great tenant, never complains and always pays on time I wanted to accommodate her request. So when I talked to the tenant  @Richard Heine I requested that her son  be present to determine what level of finish they were wanting in the bathroom upgrade so as not to be seen as taking advantage of her. In our conversation, I offered to them, that if the estimate came back too high, that I'd be willing to carry some of the cost for a short term and that she could just pay an additional payment with the monthly rent until the entire balance was paid if that would help. 

So, I went to Home Depot and got an estimate on the remodel. The total price using the finish level requested was $6900 for labor and $1500 for materials for a total of $8400 before taxes. I submitted this for tenant approval and explained that if the amount was too high, for them to determine a reasonable amount that she could put down and a reasonable amount that she could afford to pay monthly to pay off the balance.

Then I waited about a week before I got an email back from the son stating that they would like to proceed with the remodel if she could pay $4000 down and pay an additional $500 per month with the rent until paid off. I mentioned to the son that we would need to sign an addendum to the lease for the additional payments.

I'm not exactly sure if this is the right approach but figured just letting them know they would they would be signing an agreement to repay in full. If anyone has any suggestions of how to handle this it would be greatly appreciated for advice here. I figure that it would take about 9-10 months to pay down the balance but there is only six months left on the current lease. I don't figure she is going anywhere after paying for the remodel. @Abby Carr as your friend said, I figure she will be stuck in my home. While I initially didn’t target older tenants, I feel that with the proper screening there is definitely potential for great tenants that will likely stay for a long time.

My plan is to contact my lawyer tomorrow and discuss this with him and have him draw something up. Since she is 84, but still in relatively good health, I'd like to have a plan on how to handle this if she were to pass before the balance was paid.

Any advice or suggestions on how to move forward on this would be helpful.

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