Giving Tenants Control of Property Maintenance?

Question

Hi BP Friends,I am working to convince my husband to buy-in to real estate investing. Ideally, I would like to find a property in the Milwaukee area that we can self-manage. We would begin with one lower-cost house or duplex that makes sense financially and is in a neighborhood that we like, and then I would learn to manage it. My husband is open to supporting the project financially, but he does not want to be called upon to run the rental. That is OK with me. He is nervous that I will be asking him to go and fix things. However, I could hire that out to a service person and budget for those things.But also --- I could look for tenants who take good care of the property and who will ideally, do a lot of the maintenance. How do I do this? I have heard mentions on several podcasts of landlords who, in their leases, give a lot of responsibility to the tenants to take care of the property, as a homeowner would. Could we please talk about this in very specific detail? :) If we begin with a single family home, I would want to have a tenant who can and wants to and even enjoys making their home a nice place.How do you do this? What do you put in your leases? How do you talk to prospective tenants about your expectations? Which maintenance items do you take responsibility for? What is your maintenance schedule for your properties?If anyone is willing to share with me their specific lease language via message, I would love to review your examples and learn from them. And how do you screen to find a person who will be caring about the property? Do I ask something like -- do you own a lawnmower? (seriously, I don't know how to address it!) Have you maintained a house before? Do you give your tenants a chore chart? (I don't mean like a mommy, I mean like a seasonal reminder kind of thing.) Honestly, in our own home, there might be some gunk in our gutters right now. I don't expect perfection, but the property needs to be protectedI would also love to know, very specifically, how you do property reviews / inspections while the tenant is living there. It sounds like many landlords do quarterly or semi-annual property checks.Let me ask it like this -- I am going to take on a new job of being a property manager for our investments. What systems do I need in place to be successful, and to have a good experience all around? Thank you so much!Karen

Mike M. · Answer

It's your asset that you've likely got thousands of dollars already tied up in and likely are expecting hundreds of thousands out of it over the course of its life. I don't do blanket statements, but this is as close as I'll come: most tenants won't care about maintaining your property properly, and 99% of the small number that do won't be appropriately qualified to do so. This is not to say you can't have them do maintenance. I require mine to do lawn care and things like light bulbs. Just be mindful of abdicating responsibility of asset maintenance to folks with little stake in it. The last two houses I purchased were arrangements as you describe that had gone terribly wrong.

Mike Hurney · Answer

@Karen M. That's right up there in top mistakes - Pushing a Spouse to do something they can't do! Should be able to find a Handyman or Fellow Landlord w/handyman at your local REIA.@John H. "A fellow landlord (Massachusetts) told me if my tenant mows the lawn, I need workmans comp on each tenant." ;-) Not yet!@Rob Beland I agree, SF rental they do or hire for the lawn and snow!

Marcia Maynard · Answer

Our tenants in SFRs are responsible for lawn care, edging, flower and vegetable beds. We take care of shrubs and trees. Two days ago we had a blustery day. Bright sunshine, but the wind picked up quite a bit. One of our tenants in a SFR texts my husband that a tree in the backyard got damaged and branches fell on the "pathway". Sounded like something minor, until the next day when a neighbor called and told us the tree was completely down and blocking the shared back alley! Lesson learned, after a strong wind, check out all your properties and see for yourself if anything is out of place, broken limbs, downed trees, missing shingles, trash cans blown away, etc. Tenants don't always report well, know what to do, or see the implications if something isn't taken care of in a timely manner.

Stephen E. · Answer

Beyond changing light bulbs and furnace filters I am not sure I would ask a tenant to do anything. Amateur work can't be trusted and pro handymen are relatively cheap. The cost of fixing a botched repair could be higher than having it done by a pro.

Cal C. · Answer

My houses are usually in pretty good shape when a tenant moves in, so there are usually fairly few repairs other than something very small like a leaky faucet or a technical required repair such as an appliance repair or an HVAC issue. Oftentimes the tenant just does the small repair without even contacting me, which I'm okay with. But for example if it involves fixing a pipe then I send my handyman. Let me lay it out a little better.Yard (tenant)Leaky faucet (tenant if possible/handyman if not)Change a lightbulb (tenant)Fix a leaky pipe (handyman)Fix a shorted out circuit (handyman if very simple/electrician if not) HVAC issue (my HVAC Guy)Appliance issue (handyman/or appliance repair man)You get the idea Simple repairs (tenant), slightly more complicated repairs (handyman) complicated repairs (technician)

Kimberly H. · Answer

I only have tenants be responsible for changing light bulbs, batteries, changing furnace filters (while realizing the probably aren't), changing the lint sock from the washing machine, mowing and trimming shrubs and snow removal. I don't want any tenant on a ladder. I feel that if I put the responsibility on them to fix things, they won't do it or pay to get it done, and then I will be inheriting a much bigger problem by their deferred maintenance. I feel the same way about pest removal, a lot of landlords put it on the tenants, but I would rather know they can tell me there is a problem so I can take care of it, instead of expecting the tenants to take care of it, and then when they don't winding up with a bigger problem on my hands.

Leslie Pappas · Answer

as a real estate broker, I can tell you that 80% of the tenants won't take care of your property the way you would. Don't you want to be informed of everything going on there? It's your investment.On the flip side, I see landlords who won't put a nickel into their properties. Slum lords hoarding the cash and stingy on all repairs.

Wes Eaves · Answer

I would NEVER have a tenant perform maintenance or repairs on a rental property. This opens up a whole can of worms that I could fill a book with. The only exception to this, IMHO, is mowing the lawn (no snow removal in FL :)

Rob Beland · Answer

John H. · Answer

I was under the impression if your tenant mows your lawn or removes snow they are now your employee. A fellow landlord (Massachusetts) told me if my tenant mows the lawn, I need workmans comp on each tenant. And supposedly if someone finds out the tenant mows the lawn (grumpy neighbor maybe) they could complain and get me in trouble with workmans comp and its $300/day until resolved.I did a quick search and this popped up... http://www.startribune.com/housing/rent/11362341.html