What would you do?

Question

Hi everyone,

Our rental unit is ready for a tenant move in. Its a 4 bedroom 2 bath nicely updated home. We've had a number of inquiries and a few visit the home. Our dilemma is who to rent it out to...

The most serious party is a very large family, 3 adult couples and 4 kids. Were very hesitant to rent it out to such a large party because we did such a great job updating the home and we feel that all that work may get damaged in a short period of time. They are willing to pay an additional $200 (from $2,300 to $2,500) if allowed to rent.

Do you guys think we should wait for another possible tenant or give this a shot?

In our budget, we have a contingency of 2 months' worth of mortgage and utilities accounted for.

We have another LTR thats been a breeze to manage for over 6 years buts its only 2 adults living in it they have really taken of the home for us...

Thank you!

Lynn McGeein · Answer

@Armando Carrera research and develop your own typical tenant qualifications so you don’t accidentally violate fair housing, landlord/tenant or local laws on occupancy limits based on bedroom quantity/size required for kids, number of unrelated persons in one house, etc. We require any tenant 18 or older to qualify for whole rent on their own unless they are a legal dependent (spouse, college student, dependent parent, etc) of applicant, even then must pass criminal background check. If you treat all applicants as equally as possible and research fair housing, local landlord/tenant laws, and required state/local disclosures, you’ll have less chance of accidentally causing yourself problems.

Armando Carrera · Answer

Thanks to all of you and your advice/suggestions.

We've decided to not rent to this large family. Wife and I are willing to risk paying another months worth of costs (but it was in our budget to begin with) than to rent to the one stated above. We have other parties interested and showings that we've somewhat "prescreened"  and look forward to meeting them. Ideally, we'd want a single family tenant.

Will keep you guys posted as to which direction we go in the next 48-72 hours.

Derrick E. · Answer

No way. Something is off. What if one of the couples decides to move out? Can the others afford rent without them?

What are the dynamics? Are they all family, or just friends? None of this would matter to me, I wouldn’t rent to them, but some questions to be asked if you are considering it.

The fact they are willing to pay $200 extra also indicates they have had a tough time renting other places, aka other landlords have told them no.

I would lower the rent and find a good tenant before I did this, but that’s just me.

Armando Carrera · Answer

Bob, Thanks for the reply! You gave me a great idea! Its something I will dive deeper.

Armando Carrera · Answer

Hi everyone,

Our patience paid off! We found a family (2 parents and 2 teenage daughters) and no pets to rent our place starting October 1st. Were super happy we didnt panic and remained calm.

Thanks everyone for your advice!

Nathan Gesner · Answer

I don't have time to read the other replies, so this may be a repeat.

Consider setting an occupancy limit on rentals. Mine is two people per bedroom, plus one. That means a 4bed home can hold nine people. This group is one too many and would be denied. Your standards can be even tighter based on bedroom size, flexible space, plumbing capacity, and other factors.

Check out the Keating Memo from HUD to learn more: https://www.hud.gov/sites/documents/DOC_7780.PDF

James Mc Ree · Answer

You will definitely have more wear and tear.

Do these applicants pass your screening criteria? If they do, be very careful in denying them because they are too large. That could run afoul of discrimination on family status. If you don't want to accept them, you could tell them you are waiting to see if you have other applications to make a final decision so as not to turn down the only qualified application you have, then risk a lawsuit.

Here are some ideas to check:

- Does the town limit the number of unrelated people living together? Are they unrelated? You could deny based on zoning limitations.

- Can the 10 people reasonably fit into the 4 bedrooms?

- How many cars do they have? Do they fit in available parking? You could have furious neighbors if you need to park 12 cars. This may lead to a lease limitation so you don't have them parking inappropriately.

Tanner Sortillo · Answer

Hey Armando, I agree with Bob on this one. You'll probably want to do some more digging on these tenants before accepting them.

6 adults and 4 kids in a 4/2 home is a red flag itself. It sounds like you have a cushion and some time to do some more digging and hopefully get an idea on what kind of tenants they are. An extra $200/mo. to me wouldn't be worth it to have so many families/people under one roof. If it were me, I'd probably hold off to see if you can't attract a single family or some other tenants.

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