Lease renewal after a fire?

Lease renewal after a fire?

Investor · Rogers, AR · Member since 2018 · 62 posts · 27 votes

Hello all and thanks in advance for your advice. In a triplex building, one of my tenants caused a grease fire in one of my units  by walking away from frying bacon in an air fryer (admitted by the tenant) which caused major interior damage to the unit only because they mismanaged the fire poorly by turning on the vent-o-hood and opening the back door. The tenants had renters insurance (I ask that all my tenants have insurance) as well as my insurance. 

My question is on renewal. Their no longer able to live in the unit and have been placed in a hotel while the repairs are made. The current lease is up at the end of October of 2021. My thinking is to not renew their lease because of the increased risk here. What are your thoughts?

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  • Investor · Las Vegas, NV · Member since 2013 · 8k+ posts · 10k+ votes
    5y

    If you renew them their renters insurance may continue to pay you rent and pay for their hotel space? Even at an increased rent? Even month to month? Tennants will be incentivized to renew if they’re getting free housing. 

  • Rental Property Investor · TN · Member since 2018 · 2k+ posts · 2k+ votes
    5y

    I would let them go, but do make sure you have a direct pathway to collect that renter's insurance.

  • Nathan GesnerBusiness Member
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    Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
    5y

    I would not renew. Sure, they probably learned their lesson and won't repeat this poor choice. But they're likely to make other bad choices. I would wrap this up and move on.

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