Tenant offered above asked rent- legal to accept?

Question

I’m showing a property today and 2 days from now

A tennant offered $150 over rent if he can sight today.  But I haven’t shown it to everybody who applied

Seems unfair but it’s tempting

Legal?

What would you do?

Thanks

Scott M. · Answer

Unless you have discriminated against someone else in someway it is not illegal to accept higher rent. That said it does raise some red flags. People who are too eager to move, like, need to be in your home TOMORROW have never worked out for us.

So, while not illegal, it makes me want to ask a lot more questions.

James Carlson · Answer

Sounds like you handled it well. I'm with the people above in one respect. We have rentals in Denver and Colorado Springs, and normally, if someone is offering more rent than is advertised, they are in some way desperate. And to me that's indicative of a potential bad tenant.

It does sound like this is a slightly different scenario. It sounds like this person understood that there were other potential tenants and that in an effort to stand out, they offered more money. That's different than my initial impression.

I find the ambiguity in tenant-screening a tough nut. We have medium-term furnished rentals in Colorado Springs and Denver. For the most part, this naturally screens out problem tenants because A) the higher price point of a remote-worker type rental is self-selecting and B) the tenants are by their nature not looking to stay a long time, potentially nest and dirty up a place or to try to overstay. (They have to get back home, afterall, or to their next remote-work or traveling nurse gig.)

But occasionally we do run into a tenant who wants to start their stay RIGHT NOW and is willing to overpay on deposit and rent. For the most part, these are tenants from the same city in which our furnished rental is located, and that to me is a bad sign. Like they just go kicked out somewhere.

Anyway, good discussion. Thanks for posting.

Colleen F. · Answer

@Jim Stanley not illegal but only accept if he would be accepted by your criteria anyway.   I have not received increased offers for rent but I have accepted tenants for units under rehab who had a similar urgent need to see and secure the unit.

Kelly Iannone · Answer

@Jim Stanley sounds like this is becoming a thing in some markets: https://www.floridarealtors.org/news-media/news-articles/2021/08/bidding-wars-coming-back-rental-market

Scott M. · Answer

Got it.  I still stand by my comments.  My point wasn't that they are in a rush to move and therefore you should be concerned, my point is people acting out of normal behaviors and routines should be questioned.  Not dismissed or passed on, but of someone offers 150 more for a rental and they are not moving in for 2 months it would make me ask them questions.

You asked what others would do, and well, that is what I would do.  Ask a lot more questions and then be quiet and listen.  Things out of the ordinary (good or bad) require additional screening in my opinion.

Steve K. · Answer

@Jim Stanley I’ve had this happen at one of our Wash Park rentals that always has a lot of competition. I don’t think it would be illegal as long as you haven’t discriminated against any other applicants, but I would still go with the most qualified applicant not just the one offering the most money. If I had an applicant that was more highly qualified I would give them the opportunity to match the higher offer and go from there.

Jim Stanley · Answer

@Scott M.

Thanks

I should have mentioned this is highlands Ranch a suburb south of Denver and the market is HOT. And the move in date is October 1 so I’m not terribly worried about their motivation

Theresa Harris · Answer

If they are one of the three that you've narrowed it down to, you could offer it to them after you do the necessary checks.  Make sure you do a non-refundable deposit that once they move in will become part of their security deposit.  In a hot market, you can get a lot of good tenants who are desperate for a good place to live.

I would not ask the others for more money.  Do take their names and let them know you will contact them if something happens with the first person (which it can).

Kaylane Davis · Answer

@Jim Stanley have you verified that they can afford it?

Tenant offered above asked rent- legal to accept?

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