First property has tenant in one unit

[Connor Kerr]

I'm about to buy my first property (house hack duplex) and one unit already has a tenant who according to the description, "doesn't plan on leaving any time soon". If I decide to keep them, should I treat them like a tenant who is a applying? For example, should I screen them, collect a security deposit, and so forth. Or should I basically just have them sign a new lease between us and call it a day?

[Ronald Allen Barney]

Originally posted by @Connor Kerr:

I'm about to buy my first property (house hack duplex) and one unit already has a tenant who according to the description, "doesn't plan on leaving any time soon". If I decide to keep them, should I treat them like a tenant who is a applying? For example, should I screen them, collect a security deposit, and so forth. Or should I basically just have them sign a new lease between us and call it a day?

Reviewing the lease should have been part of the due diligence for your investment.  But now that you're playing catch-up, review it now and see what it is you signed on for.  You're taking whatever the lease says you're taking now.

At the end of the lease it's up to you but I would get rental comps to see what market is for that unit.  If it's more than what they were paying during the lease period then you have a decision.  If they were paying rent on time, weren't trashing the place, and weren't causing trouble, I would go about a third of the way from previous rent to market rent each lease renewal.  On the one hand you want to get to the market rate for rent, but on the other with the eviction moratorium the entire world is starting to see rent payment as optional now so if they're paying, hang the f* onto them.  My two bitcoins.