Tenant legally responsible for property management?

[Seth Gerber]

I am making an offer on a property with a unique situation. The previous owner was related to the tenants in a two family home. The landlord would charge $2,250 per unit and then pay back $250 per month to the tenant as an allowance towards utilities. The tenant would also do all of the maintenance on the property. The current tenants are at will but want to sign a lease with this arrangement for 5 year term. I am very interested in the proposition as these rent levels would yield almost 20% cash on cash return for the property and potentially guarantee me rent with no vacancy for 5 years. On the downside, I am concerned about having the tenant essentially become the property manager. Are they qualified to do repairs? Are they going to ruin my house and cause long term problems? 

I am not sure how I can structure the lease to protect me from downside here. Any thoughts from experienced landlords?

[Bjorn Ahlblad]

@Seth Gerber I would not enter into a 5 year term with anybody-well maybe Microsoft or the Catholic Church. The thought of easy money is the best way to distract a LL from doing his job. I don't want my tenants to do any maintenance-generally they suck at it, perhaps outside work-lawn, shrubbery etc if applicable. If the tenants are MTM now I would continue that arrangement and I would screen them thoroughly. The LL tenant relationship will be completely different when you take over. All the best!