Bad Neighbors Who Want My House

[Cody Koetter]

Hi BP!

I acquired a rental property a few years back, that I rented to family while they were saving to buy a new house, so they have been my only tenants up to this point, for this property. They told me the neighbors next door had mentioned multiple time they wanted to buy the house. So once my family members moved out we put it up for sale at Market value to test the market while we were making some small rent repairs in case we weren't able to sell if for the price we wanted.

During that time our Realtor showed the house to a good number of interested buyers, but every time she brought a buyer to the property, the neighbors next door would come over and wait for them to exit the house to start telling the buyers the house had all these issues and that we were trying to scam someone into buying it. Come to find out, one of the offers we did not accept came in the name of their elderly mother at about 30% below asking. So they were essentially trying to buy the house using their elderly mother as the purchaser, just to have the land it sits on, which ultimately pissed them off. Needless to say we did not sell the house.

Brief Background on the neighbors: These 3 brothers dad passed away about 10 years ago, who passed down enough inheritance where they bought that house and won't have to ever work, if they live within their means. So essentially a few hundred thousand dollars 10 years ago.

Yesterday, I officially put it on the market as a rental and all 3 brothers have called me acting like interested renters (from the same number.. their elderly moms cell phone), and snooping around the property. I missed one of the calls late last night and called back today, where the elderly lady answered and said she didn't know anything about a rental but the house next door was for rent, which tipped me off they were the ones who called from her cell phone. I had 3 potential renters call me today asking about the property, and ALL 3 mentioned the neighbors came over when they were out front looking at the property, saying all of the exact same things they were saying to our potential buyers, which made the folks who called me question everything I said. At this point these people are costing me buyers, renters, and money.

Since I hadn't had to deal with putting a non-family member tenant in this property up to this point I foresee these people causing me quite a bit of trouble moving forward... 

Has anyone had to deal with this type of situation, and what could I do to keep them away from my potential future tenants, so I can get this place rented?

[Cody Koetter]

@Marc M. I did implemented the hybrid approach mentioned in my last comment. I avoided the Troll while the Marketing strategy was only a yard sign. While the interest was high during this time, none of the contacts signed a rental agreement by the end of Week 1. So I marketed the property on a number of sites like the Newspaper, Zillow, Trulia, Apartment List, Hotpads, PadMapper, Lovely, Craigslist, etc., where I received an almost overwhelming number of inquires and showings. Since I was generating leads through those third party sites, the prospective tenants only saw the house when I was there.

Since the interest was so high and the neighbors saw us showing the property about 5 times a day for a little over a week period, one of them came over after a showing and inquired about purchasing the property again. I first started out by telling him that I was disappointed in his families actions as I thought highly of them (which I didn't, but still said it). Then told him how disrespected I felt for his family to trespass onto the property to slander his neighbor (myself) and the property in an attempt to gain leverage, as it has a direct effect on my families well being. I also told him that due to my family being negatively affected by their actions, if it continued I would have to take legal action for preservation purposes, which I'd prefer neither of us have to deal with. Then, I essentially told him that the property is always for sale for X price and as he had noticed the demand is high, so continuing down the current path was not productive for his future ability to purchase the property, nor for our relationship as neighbors. At that time I already had 2 prospects asking to if we would sell the home using Seller Financing, on top of multiple qualified applications to lease property. So I told him the same thing I told all of the other people who viewed the property. The first person to submit an official offer or move forward with executing the Rental Agreement and paying the deposit, gets the property.

Unfortunately for him, and the 1 of the 2 folks looking to buy via Seller Financing, they submitted their offers after one of the qualified applicants executed a Rental Agreement and paid their deposits. While it would have been more preferable to move forward with the Seller Financing Agreement, as that would have been most profitable, I didn't have time for the property to sit empty. 

The next time I spoke with him was when he submitted the offer and while I had to decline it due to the executed Rental Agreement, I let him know that the lease was for 12 months and if he was still interested in purchasing the property to contact me in about 10 months, so everything could be finalized shortly after the current tenants move out.

Funny enough, my sister called me about 1.5 weeks later while she was doing a few last things before the tenants moved in and told me he was mowing the grass of our property when she showed up. She asked him why he was doing that, as we had a lawn service coming by the next day, and he mentioned the city had come by and asked him if he could tell us the grass needed to be cut to avoid a citation. So he just mowed it so we wouldn't get fined.

So, all in all, my takeaway from this situations were the following: 

Show these types of properties yourself, not through an agent. Avoid the troll until you can generate qualified leads. Overlap viewings to show the properties value, if possible. Only engage the troll in a position of power letting them know you thought more highly of them, whether you think that or not (to play on their emotions). Let them know the repercussions of continuing down the current path, in a non-threatening manner, along with the fact that the last thing you want to do is take legal action. Then let them decide how the relationship progresses.

In my situation it progressed in a favorable manner, however, if the troll still wants to continue down the current path Take Action as you stated you would.

i hope this helps anyone else in a similar type of situation. All trolls are different in nature so if you can find a soft spot play on it. Otherwise, take your stated action and move forward with your business.

Thanks again for everyone's input and interest in this post!

Cody