Inhereting Tenants & Lease Non-Renewal

[Michael Breedlove]

Hello BP! My wife and I will be closing on our very first property next week. It's a 4 plex in the New Orleans (Metairie/Old Jefferson) area that we will be Owner Occupying. Currently all 4 units are rented. 2 are on month to month leases and 2 are on year long leases.

My questions are 1) What's the best way to handle a Lease Non-Renewal for one of the Month to Month units since we have to occupy the property? In Louisiana, I'm pretty certain I have to provide in writing 30 day lease non-renewal information. 

2) I know there's a difference of opinion on lease terms, but what are your suggestions for lease terms and why...month to month, 3 month, 6 month, 1 year? 

3) 2 out of the 3 remaining units will be Section 8, but I do not plan to continue with the section 8 program once their current leases are up. Any advice for temporarily handling section 8 housing and any advice for non-renewal of those leases as well?

Thanks for the tips!

[Marcia Maynard]

@Michael Breedlove, as the new property owner, you certainly have a right to terminate tenancies in accordance with the laws for your jurisdiction. Other than the unit you will be owner occupying, why would you want to terminate any others? You may find that the tenants who have made those units their home are good people and good tenants. Their tenancies may be worth saving.

Section 8 tenants can also be good people and the Section 8 program administrator for your area may be fine to work with. Our longest term tenant, on a M2M contract, is Section 8 and has been in the same apartment for 28 years! Much more stable than others, the rent is always paid on time, and the tenant is motivated to take good care of her unit.

@Stephen Leonard will be able to guide you much better than those of us from out-of-state. His advice is sound. Take him up on his offer to assist you. I agree with him, if you intend to terminate a tenancy, give ample notice. It's not easy for people to suddenly have to give up their home.

As soon as you take ownership of the property, introduce yourself to the tenants in a positive manner. Be polite and professional. Introduce the tenants to your management style and attend to any of their concerns promptly. If you intend to keep the tenants, transition them over to your rental agreement and property rules as soon as you can. 

You will be on a learning curve as you adjust to your new role and your new responsibilities. Give yourself time to adapt. Not only will you be their landlord, you will also be their neighbor, so establishing a good relationship and clear boundaries will be paramount.

Congratulations and Good Luck!