Handling Inherited tenants

[Nicholas Gambino]

Just closed on my first duplex and I am inheriting a tenant from previous owner. Seems like a nice tenant but still don’t know. I will be taking the lower unit and his 1 year lease ends at the end of month. It will default to month to month until we agree on new lease. I verbally told him I probably plan on doing month to month and I am talking with my lawyer about getting a contract written up.

In all honestly I would prefer to start fresh and screen my own tenant. I feel a little uneasy because the tenant has been living there for awhile and I think he got too comfortable living with no neighbor for Atleast 8 months. I also have a lot of people inquiring me if the other unit would be for rent so I am not worried about finding a new tenant.

The current tenant is paying about 200 dollars below market rate and I feel I could really give it a small update to get it just at market rate or just below. How should I handle this situation?

I was thinking of doing month to month. Let myself self settle in and than give him a 90 day notice that I will not be renewing his lease come September.

[Nathan Gesner]

Such a common thread.

Be honest with people. If he's $200 below market, you don't want to keep him because that will cost you $2,400 in lost income per year. Give him notice. Tell him you need to do some renovations and rent it at market rate. He may try to negotiate staying longer, paying more, helping with renovations, etc. Don't accept it. Just give notice and be firm.

I also don't recommend 90 days to vacate, unless your state requires that. 30 is enough and 60 is generous. Get him out and then look for a new renter in the summer while the market is hot.