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12 Sept 2011

Enforcing Lease Terms

Let me the first to admit that I'm not always good with enforcing lease terms in the lease agreements with the tenants. I tend to be lenient, more so with the tenants I know. And yes, I rent properties to people I know, and other than the fact that they do negotiate sometimes, they are proving to be better that my average tenant. Anyways, I try to do a better job at screening to get the tenants that are unlikely to default on the contract terms. I still get late rental payments, but it can be worse, I count my blessings.

The Terms I never tolerate include:
  • High Number of Occupants
A maximum of four people in a two bedroom (double bedrooms) is a general rule. That would be a couple with two kids. I hardly ever get maximum though. My new single mom applicant for a three bedroom duplex has four kids. But two are in college already. I had an overcrowded unit, which was sadly let by my property manager. I guess they didn't declare their room mates. I managed to evict them, nicely.
  • General Neighborhood Rules
A tenant is your responsibility, not the neighbors'. I find the tenants in multifamily dwellings to be an even higher responsibility. There are always long lists of rules to ensure a harmonized life. Every time I get a new list of rules, I replace the old one in the tenant files, and email it to the tenant. These are simple rules like the keeping of pets, speed limit in the community, allocated parking spaces, or taking care of the gardens and porches. 

I find that playing my own part helps ease enforcing the lease terms in the agreement with the tenant. This is not a one sided process. One of the best ways to retain the best tenant is having a landlord take care of the property. The reliable and well paying tenants demand the best space. It is fair that way. I strive to keep the place well maintained. I am yet to find a reliable handyman though. I haven't been lucky in that department. 

I also keep the lines of communication wide open. My tenants email/ call/ text me anytime. They know they can. Their advantage is that I only have five units, unlike the property manager looking after tens of units. A friend of a friend was managing 40 units. That's a lot of properties to manage without an assistant, I think. I find that, if I communicate more with my tenants, they take better care of my properties. And this is not the case with properties that are managed by a third party. 

Continuous improvements on the place also add to the satisfaction of the tenant. I usually make a small improvement with every rent increase. When the rent went up in one duplex, I asked the tenant to give a list of things she would love to have changed. Its usually small things like the change we make in our own homes. It doesn't have to be costly. Sometimes we spend a lot more on repairing an oven than it would cost to replace it with a new one. 
Yesterday I shared my move-in and move-out tenant/ landlord check list. Feel free to edit and use it. From enforcing lease terms to the latest post.


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