Tenant wants 3 year lease for SFH
I am looking for some advice from the experienced landlords out there. I am in process of filling my new SFH and have a tenant that is interested in a 3-year lease or longer. I have yet to do the full background checks on criminal/eviction/credit but proposed tenant seems confident that there are no issues.
Other than a cap to my ability to raise rents during the lease-term, are there any downsides that I am not considering? Showing the property tonight so would really like to get your feedback and advice asap. Thanks!
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#3 Real Estate Deal Analysis & Advice Contributor
- Rental Property Investor
- Mercer Island, WA
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#3 Real Estate Deal Analysis & Advice Contributor
- Rental Property Investor
- Mercer Island, WA
I hate long leases. Longer than a month. A long lease ties your hands much more than the tenant. If you have a troublesome tenant that's not easily evictable, you're stuck. Its easy to evict for non-payment of rent. Unauthorized pet? (It's a friends, and just visiting. Extra residents? (just visitors.) Cars parked in yard? Lots of things that will cause you trouble. With a month to month, you can simply terminate the lease.
Now, you'll say "but the tenant can do the same". Yep, they can. Guess what? If they want to leave six months into that three year lease, they will. What will you do? Take them to small claims court and get an noncollectable judgment? Keep their security deposit? I'd much rather have them give me notice and leave after being there six months than to just disappear.