New Landlord issues

[Nnabuenyi Anigbogu]

Hi all, 

I am about to close on my first multifamily (a 4 unit property this Friday) and become a brand new landlord. I am looking forward to it but im also apprehensive. I have read just about every blog on BP related to landlording and am reading books on it also.

My question is regarding kicking people out or potentially evicting them. All my tenants are month to month right now (all come with building) and the only open unit is the owners unit. However the owners unit is a 4 bedroom/2 bath which is way too much space for just me and my fiancee. Also i can get about 2k a month for that unit in my market (compared to 850-1k or so for the rest of my units).

Because of that i would like to move into one of the 1 bed/1 bath units that is currently occupied. Since the tenant is month to month I learned i can just tell them i am not renewing their lease and they have to be out by the end of June (working with my lawyer to give them the notice). However even though i know this needs to be done i am still apprehensive of doing it (i have been told im too nice to people). The guy is a hoarder also (could barely walk through the apartment) so he probably should be kicked out anyway.

I just wanted to get some advice on how you guys deal with having to kick people out and so forth. I know its necessary but it doesn't make it easier.

Thanks

[Seth Nadreau]

First off... congrats on your income property! It sounds amazing!

I should preface this with the typical chatter about not being a lawyer and not being qualified to give legal advice... so there it is.

As a landlord, kindness is a double-edged sword. I, like you, am a good natured person and hate hurting anyone's feelings. I believe in being nice and kind and the world will reward that.

At the same time... you are now a business and you have to think like one. Your idea of taking residence in a smaller unit and maximizing your income is great. Is there one particular reason that this tenant is the one you are choosing to not renew with?

One option available to you is to ask all tenants to sign 1 year leases and sometimes the tenants will weed themselves out. Of course, you run the risk of everyone leaving. If you're open to residing in other units, I would talk honestly and openly to the tenants. Maybe one is willing to move... especially if you offer them their last month for free. Sure, you lose a few bucks on the short end, but gain more than enough on the back end by leasing the larger unit.

Lots of options for you. State law will dictate the notice you are required to give and you can use some of that kindness to make the move easier on a tenant if you choose to.

Again, I would recommend trying to lock them in to annual leases if you can. That ensures 12 months of income and decreases the chances of losing money to vacancies. It also doesn't hurt to offer a small reduction $25 a month or so, if they'd sign an 18 month lease... that way you can stagger some of your leases and not have all of them up for expiration at the same time (if everyone moves out, you are in a world of hurt!).

Hope this has helped in some way.