Enter your email address for weekly access to top multifamily blogs!

Multifamily Blogs

This is some blog description about this site

Managing Problem Tenants

Managing Problem Tenants

Chances are every landlord will encounter a problem tenant at one point or another in his career. Whether issues arise based on noiseresidential tenancy agreement levels, delinquent rent payments, illegal roommates, or any number of other violations, dealing with problem tenants can be tricky. Following are some tried and true suggestions for dealing with issues as effectively as possible and—better yet—avoiding renting to problem tenants in the first place.

Prevent problem tenants from getting a foot in the door.

The importance of carefully screening tenants before locking yourself into a lease cannot be overstated. No matter how eager you are to occupy a unit, renting to an unqualified tenant is never worth it in the long run. In addition to checking credit and criminal records, be sure to call former landlords for applicant references.

Remember, some landlords may be unwilling to explicitly state that they do not recommend renting to a potential tenant for fear of litigation. Bear this in mind when speaking with references, and be sure to read between the lines when necessary. Sometimes what a reference doesn’t say is just as important as what she does say. Ask the applicant’s former landlord if she would rent to the tenant again. If the answer is “no,” think long and hard before handing over that lease.

Have a system in place.
Many leases neglect to cover behavioral expectations. Be meticulous and specific when it comes to setting forth your expectations, whether it be in your lease or as part of a lease addendum. Also, make sure you have a clear system for issuing warnings in place and that all tenants know how this system will work from the offset. For example, let tenants know that should problems arise, they will receive two written warnings for lease violations. On the third violation, they will be asked to vacate their unit. Finally, be sure that all tenants sign off on these guidelines before handing over the unit keys. This will ensure there is no room for dispute further down the line.

Follow through with your system.
Just as important as tenants abiding by your guidelines is that you abide by your guidelines. After all, if you don’t take your rules and regulations seriously, why should your tenants? In other words, if a tenant violates a building rule or regulation, make sure you follow up with the appropriate prescribed action as set forth in the lease agreement. Also be aware that an inconsistent system could cause problems down the line. It’s important that all tenants are treated equally. For example, if you neglect to write one tenant up for a noise violation, you can hardly write up another tenant for a similar violation.

Keep the lines of communication open with all tenants all the time.

When it comes to problem tenants, communication is critical. In cases where a landlord has developed a friendly relationship with tenants, it can be uncomfortable to put on the disciplinarian hat and issue a formal written warning. You have to maintain your role as the resident authority, but you don’t have to do so at the sacrifice of your relationships with tenants. Should such a case arise, keep the channels of communication open. Follow through with the prescribed warning, but take the time to talk openly with your tenant—listen to his side of the story and explain where you’re coming from. Also in terms of communication, if a tenant complains about a fellow resident, be sure to follow up and let the tenant know you’ve addressed the problem.

If tenant problems are serious and consistent enough that eviction is warranted, carefully check your state and local laws and take the steps necessary to begin the eviction process. Eviction is never ideal, but if you don’t address the problem tenant, you may inadvertently lose some of your good ones. And no landlord wants that to happen.

 
This comment was minimized by the moderator on the site

Hi, I apologize for not addressing your emailed questions before your post, juggling vacations, kids out school, yada, yada, anyway, perhaps we can get some feedback going here with your post.

We have a somewhat different approach at Urbane. Resident complaints fall in my area of responsibility at our little company, and I will be honest with you, we embrace Resident Complaints at every level. Almost always, a Resident Complaint is an opportunity wrapped differently.

The folks who actually take the time to email, call, tweet, make a negative post, actually care about you more than you realize. They have taken the effort to reach out. I can tell you that in almost every occasion, we have turned them around and into Resident Evangelists. The times we didn't turn things around had more to do with my own arrogance and need to be right, as opposed to listening and playing out the process.

I am not a believer that the customer is always right, and am in no way bashful about respectfully disagreeing. But what the customer does always have a right to is their voice, and opinion, which when you provide the Resident with a platform for complaints and criticism, those a excellent opportunities to show them and the rest of the world how you react to problems.

  Eric Brown
This comment was minimized by the moderator on the site

I think that it is vitally important to not rent to the problem tenant. They are not always recognizable though.

Once you realize that you have a problem tenant it is best to settle the disputes early. You will find in hindsight that a month's free (or two months) rent is far cheaper than the attorney's fees you will incur. You need to get an enforceable agreement to vacate and a release with a confidentiality clause in return.

I speak from experience as a lawyer.

  Matthew Moore
This comment was minimized by the moderator on the site

@Matthew - That's an interesting perspective. Yes, it would be nice to have a psychological evaluation as part of the application process. Since that's not possible, you have to accept that even crazy people need apartments and one day they might become your customer and you have to treat them just like everyone else (I'm not referring to someone clincally diagnosed and thus part of a protected class... just someone who isn't quite right and expects you to understand and help them).

If you really think about it, all of our residents could be considered a "problem tenant" at least once in their residency. I'm not sure it would be in anyone's best interest to move them out instead of accepting some responsibility for their complaint.

I will say there have been a few times in my career where I did let someone out of their lease because I didn't think I could EVER make them happy. I wouldn't have considered them a "problem tenant" because the real problem was that we weren't meeting their expectations (even though sometimes the expectations were unreasonable for the situation).

  David Kotowski
This comment was minimized by the moderator on the site

I should have been more clear in my previous post about problem tenants. I know that property management professionals deal with a wide variety of problem tenants who normally can be won over with kindness, respect and attentiveness.

As a lawyer, I deal with a smaller subset of problem tenants. The ones that you have to sue for breach of lease for inappropriate behavior or ones that file frivolous administrative and civil claims against the management company. My point was that it is often cheaper to and better to reach a quick settlement that gets them out of your apartment complex. Of course, if faced with unreasonable demands you will have to see the litigation through to the end

  Matthew Moore
This comment was minimized by the moderator on the site

Boy do we know about this. We recently acquired a troubled property and our ongoing issue is tenant quality. Failing to fully sort this out before closing is going to cost us 6 months on execution of our business plan.

In the future, we are spending more time screening tenants as well as facilities on acquisition.

Blake Ratcliff
[url]http://www.apartmentmarketingsolutions.com[/url]

  Blake Ratcliff
This comment was minimized by the moderator on the site

Eric,
Thank you for your comment. I believe we are on the same page when it comes to embracing resident complaints, but I think I need to clarify what I mean by “problem tenant”: a “problem tenant” is a resident who decreases the value of a property by damaging the real estate, not paying rent, and/or disturbing other residents. In my experience, most complaints are not made by “problem tenants,” the “problem tenants” are the ones trying to stay under the radar when it comes to interacting with management.

As for turning complaining residents into “Resident Evangelists” I strongly agree with you. It seems like you keep open lines of communication acknowledging complaints and you take appropriate actions to clarify the issues. Ignoring resident complaints is a lose-lose situation because as managers we end up with unhappy residents and miss opportunities for improvement.

Mathew & Blake,
Great input! I strongly agree that potential “problem tenants” are tough to recognize, this is why we must perform the proper due diligence to prevent them from getting in the door. Easier said then done, but making the extra phone calls to previous landlords may end up preventing problems down the line.

David,
Well said. I’m sure we’ve all rented to what we consider “crazy” residents. Their not fun to deal with, but it happens.

  Buildium LLC

Comment Below

  1. Posting comment as a guest. Sign up or login to your account.
Attachments (0 / 3)
Share Your Location

Recent Blogs