The perfect scenario:
You are lounging on a sunny, deserted beach with your
loving wife by your side. You have a
cold drink in your hand as you marvel at the solitude and beauty of your
surroundings. The only sounds you hear
are the waves gently crashing in front of you and the occasional fluttering of
a seagull’s wings. The sun subtly warms
your skin before a timely breeze arrives to refresh you. You grasp your wife’s hand as she lovingly
reciprocates. And you just filled your
last rental property with a tenant. Life
is perfect.
But, wait… is that your cell phone ringing in your beach
bag? Who could be calling you? As you reach for the phone, your wife
aggressively removes her hand from yours.
“You better not answer that! We
haven’t been away together since Eli was born and I’m not going to have our
vacation ruined by work calls!” As your
eyes refocus to the numbers on the phone, you realize it is the new
tenant. “I’ve got to get this,” you
mutter as your wife disgustedly begins to turn her beach chair away from
you. You feign an enthusiastic greeting
of “Hey Herb, what’s up? How’s the
place?” as your eyes plead forgiveness to your now emotionally-estranged wife.
Herb begins his 10-minute rant, “This place is a dump! The whole house is filthy! The cabinets and appliances are especially
gross and the entire trim needs to be repainted. The landscaping has been completely neglected
and the yard is mostly weeds. My wife
and I have spent our first 48 hours here on our hands and knees scrubbing and
aren’t even close to being done! The air
conditioning doesn’t even blow cold air.
How could anyone live in this place??”
“Multiple tenants have managed to survive the experience in
past 12 years I’ve rented it out,” you want to retort and then think better of
it. You turn your head to see your wife
disgustedly heading back towards the resort while pounding feverishly on her
iPhone, undoubtedly spewing Facebook hate (Subject: You).
Herb is irate and you hear his wife trying to get into the
action in the background. Once Herb says
his piece, you tell him you’re very sorry, you’ll have someone over to look at
the air conditioning, and will send the cleaners back (“No need! If they think the condition they left it in
was clean, I don’t care to entertain their second act!”).
So this is bad. You
thought you had the rental home in good shape and the tenants are ripping it
apart. You look up at the resort and see
your wife talking to the pool boy as she uncharacteristically is downing
cocktails at 9 AM. This was supposed to
be a relaxing, loving vacation and things are going very wrong.
What could have been done to avoid this tenant situation? Honestly, nothing. No matter how clean a house is left, some
tenants will say it is filthy.
Cleanliness is subjective.
There is a relatively predictable spectrum of responses from
tenants after they move-in:
1. 10% will be happy
with whatever condition the home is in when they move-in
2. 10% will be
unhappy with whatever condition the home is in when they move-in
3. 80% will be happy
if the home is reasonably clean and touched-up when they move-in
So if things are reasonably clean, all major systems are
working, and the house has been touched up, 90% of tenants will be happy. And everyone likes happy tenants.
And what about the unhappy 10%? It’s not a desirable situation, but there is
a silver lining. You will take heat on
the front end from them; that is for sure.
And you won’t like it. But there
are 2 positive takeaways:
1. There was nothing
you could have done to avoid their unhappiness.
If you fixed your home up to such a pristine condition, it would crush
the ROI on your investment property.
And if you are going to pay to fix it up that much, do it only once and
sell it for top dollar. Don’t do it
every year. The objective (I’m told) is
to make money on investments.
2. When the initially
unhappy tenants vacate, they will probably leave your home in move-in condition
for the next tenant! This allows you to
take the pain now to experience joy later.
So, to sum it up:
1. Fix-up your home
in a reasonable manner between tenants. This means all systems working, touch-up paint
(don’t repaint the house), steam cleaned carpet (don’t replace the flooring),
and professional cleaning.
2. Hire a property manager so you
don’t have to answer the phone on vacation.
3. Go get your wife!
3. Go get your wife!
Brett Furniss is the President & Owner of BDF Realty (Charlotte Residential
Property Management), the trusted real estate advisor for Charlotte
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