As Landlords our biggest “key” to success is our ability to find great tenants who pay on time and keep our home in great condition. So what would be better than having friends be tenants, right? You know, someone that you know and trust. They must be the PERFECT tenant… or are they?
Friends as Tenants: Good or Bad?
My Definition of Friend
Friends are the one who get us through the tough times. You know the ones you can walk into their home and know that no matter WHAT is going on in your life they are there for you. At the same time you are there for them. You know the ones you cry over wine, wipe “sleep” with coffee, and bring Panera for lunch when it is one of those the “world” will end days for the other person and you can’t cook.
Wait that’s me.
Here’s the thing! In my book that makes them horrible tenants! Not because of who they are but because of my definition of FRIEND versus BUSINESS.
Definition of a Rental
For me, rentals are a business. During the operation of my business I have to say No often. I have found that tenants always want to negotiate and push the boundaries. That’s normal, and as a landlord I expect that. Their goal is to find them the best possible deal as they are looking out for THEMSELVES. I totally get that. I would do the same.
Here’s the thing, as a landlord my job is to watch out for ME. If I don’t protect my investment no one else will. I am a strict by the book landlord. I treat my tenants with respect and follow the golden rule of treating others how I wish to be treated. But I am a professional, I say no, and I remember my goals and bottom line. I don’t negotiate, and I expect my tenants to toe the line. When they don’t; I call them on it.
It’s important to know you! This answer is as unique as the person. The thing is I know that renting to my friends would be disastrous because of who “I” am as a person and as a business one. You may not be that way. Maybe, just maybe, it will work for you.
My Friendship as Families
Being active duty military our FRIENDS become extended family. We have car seats in our cars (even though our kids are either too old or we don’t have any). We are the emergency contact and we are the one who doesn’t “judge” we support. We are there for you no matter what!
While I treat others like I want to be treated-I do judge. If you abuse the SCRA, don’t pay your bill, or ask for pest control or something else that your lease says it is your responsibility then I WILL call you on it! I have multiple properties so I HAVE to follow fair housing laws and enforce my lease. I am obligated to treat ALL of the tenants the same. Special treatment will get me in hot water.
I will enforce the deductible and probably you will be responsible for EVEN MORE of the repairs. I will know exactly how many rib bones went down that garbage disposal and will charge you for it!
But let’s say I didn’t and I let it go:
Then it would be an infected sore that would fester and bother me and eventually be the straw that broke the camel’s back. This would cause me to become a red head mess AND there goes my friend.
You know the one who has been there for me through everything. So I lose twice!
Now everyone else is different. Maybe you can differentiate or not get upset when they are costing you money (my pet peeve). Maybe you can distance yourself or they are perfect. (Is anyone really perfect?). Maybe it’s your best friend but your husband has nothing to do with her so he does all of the handling.
Is it worth it to risk it?
Are you willing to lose a friend because of business??? Because I HAVE! While it wasn’t as a rental- it was in business. Let me tell you it was sooo not worth it! In the end I lost a great friend/acquaintance and the deal still went south.
In the end it just isn’t worth it to me. While it might be a little more work or “risk” I would rather find a stranger who I can start off on a business relationship and then go from there!
For me, mixing family and friends with business is a “no-go”.1