In this week’s episode, Podcast Host, Andrew Schultz, discusses messy tenants and the negative impact that they can have on your property.
What’s better for profitability, a condo or a single-family rental? If conditions were nearly exactly the same, which would you choose and why? We’ll discuss our answer.
Last, but not least, find out the steps to possibly take when you have a hoarding tenant that is protected under the Fair Housing Act.
Andrew Schultz: (00:00)
Hey everyone. Welcome back to another episode of the Rent Prep for Landlord’s podcast. This is episode number 374, and I’m your host, Andrew Schultz. On today’s episode, we’re gonna be talking about messy tenants living on a property. What makes the better investment, a condo with an HOA versus a single-family home and is hoarding protected under FHA we’ll to all that right after this.
Voice Over: (00:26)
Welcome to the Rent Prep for Landlords podcast. Now your host, Andrew Schultz.
Andrew Schultz: (00:31)
Before we jump into today’s episode, don’t forget to check out the Rent Prep for Landlords Facebook group. It’s a great free resource for you to tie in with housing providers from around the country. And if you have a question to, or a situation we’ve never dealt with with almost 13,000 members, chances are someone in the group has been there before and can lend a helping hand. We’re on the push for 13,000 members right now. So if you haven’t checked it out yet, do it today over at facebook.com/groups/rentprep. Don’t forget to mention the podcast when answering the questions. So we know how you found us
Voice Over: (01:07)
Forum quorum, where we scour the internet for ridiculous posts from landlords and tenants.
Andrew Schultz: (01:15)
We’re gonna get started this week with our first forum quorum. We have two of these this week. This first one comes to us via the landlord subreddit, and it’s kind of an interest on what to do when you have messy tenants. I’ve got a situation I have month-to-month lease agreements with tenants. Living on my property. One tenant has become exceedingly disruptive with the messes that they leave behind everywhere that they go. And they’re not even parking in the garage to leave enough room for one of the other residents, two questions. Number one is at my responsibility to give them messy tenant, a written reminder, it’s in their contract to maintain the shared living quarter. It is my property and I want it to be respected. Question two, if they fail to improve their behavior and they are on a month-to-month lease, can I still give them a written termination letter?
Andrew Schultz: (01:57)
Or can I just say, after I’ve collected rent payment for the month that this is the last month you’re allowed to live on the property? And again, this one comes to us from Reddit over on the landlord sub-Reddit. So I’m gonna start this one off by saying, yes, it is your responsibility to manage your property. Part of managing your property includes dealing with situations that tenants cause. And this is an example of a situation that a tenants caused that you have to do something about. It’s not always the most pleasant. It’s not always the most glamorous, but that’s part of property management. Um, you questioned, excuse me, you mentioned in the question that you want the property to be respected. Of course, you do. We all want our properties to be respected. Part of getting tenants to respect your property is knowing how to deal with situations like this when they pop up.
Andrew Schultz: (02:42)
There’s not a lot of mention here as to whether or out there was any discussion with this tenant prior or not. Um, but typically I would start this off by just having a conversation with the tenant and asking them to clean up after themselves and be a good neighbor. Give ’em a few days, see if they’re complying. And if you don’t see any signs of compliance at that point, uh, I would go ahead and issue the written notice the notice to cure. There’s gonna be different rules on serving these depending on your state. And there may be timeframes that you have to adhere to such as here in the state of New York. You have to give a 10-day window to comply. So make sure that you check the laws in your area and understand what the requirements are specific to what you’re doing in your area.
Andrew Schultz: (03:22)
Now, the second question was, can you terminate that tendency if the tenant fails to comply, if they continue to be messy, I would say that in most areas, yes, you should be able to terminate that tendency period. End of discussion. Now again, every state has specific rules on terminating tenancy and when you can terminate when you can’t terminate. So you’re gonna wanna check to make sure again, that you’re in compliance with whatever the regulations are that you need to be in compliance with, but that’s absolutely gonna be the route that I would go. Um, if you issue a tenant, a written notice to comply, and then that tenant fails to comply, you move forward in the process you issue the termination of tenancy notice sometimes that’ll be enough to get the tenant to fall into compliance. And then other times it is the beginning of the end of that tenancy.
Andrew Schultz: (04:08)
You either wind up with a tenant that moves out at the end of their lease term, or you wind up with a tenant that you have to take through the eviction process. Whenever you’re giving a notice to terminate a tendency might re is always give it in the written format. Most states are gonna require this by default anyway, but even if your state does not require it for some reason, I strongly recommend that you give that notice to the tenant in writing. You may even want to have the notice sent certified mail or in a real extreme case. You may want to have a process server even serve the notice on the tenant. Essentially, really what you’re trying to do is prevent a situation where the tenant claims that they never talked to you about moving out or anything of the sort, which is basically the exact type of situation.
Andrew Schultz: (04:51)
You open yourself up to by having a verbal conversation on something like this, rather than sending a written lease termination. So definitely move forward with a written lease termination, no matter what, if that’s the route that you’re going, um, don’t do that verbally. Make sure that it is in writing best of luck to you as you work through your messy tenant situation and good luck. Our next forum quorum also comes to us via Reddit. This one also comes via the landlord subreddit. We’ll go ahead and jump right in here. I’m looking for your opinions. Would you prefer purchase a condo with a reasonable HOA fee or a small house? Assuming the price neighborhood size and condition are the same. Why would you pick one over the other? Uh, I love questions like this when they come through, we don’t get nearly enough of these, but, uh, I would say that whenever given the option, I personally have to say, I will look at an opportunity that does not include an HOA before.
Andrew Schultz: (05:46)
I will look at an opportunity that does have an HOA. I wanna preface that and say that I may be regionally biased on that because we don’t have as many HOAs here in the Western New York region, as what like the Southwest has, for instance, where many, many neighborhoods were developed under HOAs and things of that nature, it’s a lot harder to find property that is not under an HOA in other areas of the country, but at least here in Western New York, the bulk of our property is not under any kind of an HOA or anything like that. So I may be a little bit biased simply based on my geography on this one, but I’ll continue. Anyway, frankly, HOAs are a nightmare, probably 90% of HOAs anyway, are a nightmare. Um, the amount of control that an HOA has over the property that you own is ridiculous.
Andrew Schultz: (06:35)
In a lot of instances, I’m sure everyone has read horror stories on the internet about having a terrible neighbor who happens to be on the HOA board. And then, you know, they turn around to make the property owner’s life a living hell. Now imagine owning an investment property where you don’t control the day-to-day lives of the tenants that are living there and having to deal with the HOA on top of that, it it’s a true recipe for disaster. I hate HOA investment properties. I would strongly recommend against investing in areas where you have an HOA. I think I’ve kind of made that pretty clear at this point. Also keep in mind that you need to double-check whether or not the HOA that you’re looking at, even permits rentals before you make a decision on whether or not you want to purchase that unit.
Andrew Schultz: (07:17)
Many, the HOAs will limit the number of rentals in inside of the HOA, or they’ll just outright prohibit rentals inside of the HOA altogether, which is within their rights in part as part of the HOA. It’s crazy, but they can deny rentals altogether. So you could be buying a property that you’ll never ever, ever be able to rent out. Um, you’re gonna wanna make sure you review the, those HOA rules before you get too deep into your transaction. You don’t want to get all the way to the end of this thing when it’s time to join the HOA and find out that you’re literally buying a property and you can’t use it for the purpose that you intended to use it for. Uh, another reason that I’m not a big fan of properties with an HOA is that they can issue a special assessment pretty much whenever they want to.
Andrew Schultz: (07:59)
And when it’s time to raise funds to do a capital improvement project, you’re gonna have no control over that. So you could buy a property that has an HOA fee of say 250 bucks a month. And the HOA board could decide that they wanna redo the siding on the building or something like that might be in perfectly good condition. They just don’t like the color of it. They can issue a special assessment for something like that. And then you’re gonna be stuck paying that special assessment, whether you want to, or not based off a decision that you had no control over, I guess, the best way to combat something like that would be to join the HOA board. Especially if you plan on owning an investment property in that HOA. Um, it’s, it’s definitely not something that I would wanna do. It’s one more thing that I would have to handle on top of everything else that’s going on in my life.
Andrew Schultz: (08:44)
And it certainly means that the investments no longer passive it’s active. When you have to go to an HOA meeting, it’s active, it’s no longer a passive investment in my mind, but it may be one of the only ways to actually protect your investment. If you buy a property inside of an HOA, there’s a lot of things that happen inside of these HOA board meetings that don’t necessarily have a positive impact on the community as a whole. And may really only benefit a few people on the board or a few people in the neighborhood who either, or have an ax to grind against someone, or they just wanna argue about everything or whatever, whatever the case may be. Now, there are a few different reasons why you may want to purchase an investment property when there’s an HOA in place. If you live far from the property and it would be difficult for you to handle the exterior maintenance from afar, then an investment with an HOA, maybe in your best interest, depending on the HOA, they may take care of things like exterior maintenance, lawn, snow, trash, whatever, um, do your research find out what your HOA covers and when you’re trying to manage a property from a distance, all of that sounds pretty appealing.
Andrew Schultz: (09:52)
Um, you could almost certainly get those same services at a lesser price outside of that HOA, but it’s nice to know that that stuff it’s just plain taken care of and you don’t have to worry about it. At the end of the day, you just work the HOA fee into your deal analysis and you know that, okay, my HOA fee is gonna cover whatever. So you don’t have to factor those other expenses into your deal analysis. So if you have an HOA fee and that covers lawn and snow, you’re not gonna have a line for lawn and snow on your, on your deal analysis essentially. But yeah, that’s my take on investing in properties that have an HOA, I would say avoid it at all costs by the single family, without the HOA and enjoy your investing
Voice Over: (10:33)
Water cooler wisdom expert advice from real estate pros.
Andrew Schultz: (10:41)
Last but not least. We have our water cooler wisdom segment. This one comes to us via the Rent Prep for Landlord’s Facebook group. Uh, we do pull questions outta there quite a bit. If you have a question, um, that you’re looking to get answered, that’s a good place to post it, and it may end up getting featured in the podcast. We’ll take a look at this one again, this is our water cooler wisdom segment. I took over the property, but I’m wondering how to proceed with the tenant. The tenants live there for over 35 years is elderly and falls under a protected class due to hoarding behaviors. Uh, the tenants also under rent control, no rental agreement is in place and I can’t implement one due to the rent control. I can only offer or a new one, but they have refused to sign it.
Andrew Schultz: (11:20)
How would you proceed? Wow, this is an entire situation, uh, that can be sticky. The whole thing. Uh, I think I’m gonna preface this by saying that I’m not an attorney and that you should probably speak with a landlord tenant attorney that has a really, really good grip on fair housing law prior to proceeding with any, anything in this situation. Uh, we’ll come back to that in just a second. I do wanna talk about some of the risks to you as the property owner, as well as risks to the property as a result of hoarding. Uh, I mean, obviously the first risk is pretty straightforward. You’re adding a ton of weight into that property with whatever it is that’s being hoarded. You’re likely going to start to see some structural concerns as a result of that weight. Keep in mind that a gallon of water raises over eight pounds.
Andrew Schultz: (12:04)
How much do you think a Florida ceiling stack of newspapers is gonna weigh? So as the size of the horde increases do so, does the weight of the horde? I think, think that’s pretty much common knowledge and that could definitely have major impacts on the structure you’re building. This is gonna be seen anywhere from sagging or broken floor joists. Um, you could see issues with wall movement. You could see issues with ceilings, possible, collapses, things of that nature. Obviously, there’s a huge increase in the risk of fire from combustible materials as well. And then there’s the fact that getting in and out of these places isn’t necessarily the most easy thing to do. If there’s a medical situation, can the paramedics get a stretcher into this house and get to the patient? They have to be able to get back out after if there’s a fire, can the firefighters safe, get into conduct a search or to try to get someone out of the property?
Andrew Schultz: (12:57)
Obviously, all of this is stuff that has to be considered when you’re dealing with a situation where you have a hoarder. Now, jumping back to the original question here you are correct that hoarding may be considered a protected class. As of 2013, hoarding is now considered a disability and it, when it comes to disability and housing, the words reasonable accommodation get thrown around a lot. Hoarding is not something that just happens overnight. It’s a buildup over the course of time. And if you’re able to catch this early on in the process, it becomes a lot easier to deal with. Uh, the longer hoarding issue is sort of allowed to go on the longer it goes unchecked. The more is allowed to accumulate the worst the situation gets for everyone. Typically speaking, the reasonable accommodation for someone who is hoarding is more time to get rid of the hoard and access mental health services.
Andrew Schultz: (13:47)
So depending on what sort of outside factors you’re dealing with, such as building inspectors, code enforcement, people, whatever the case may be more time may or may not be necessarily a viable, reasonable accommodation. So you are gonna have to figure out what the reasonable accommodation is gonna be here. And that’s the recommendation. That’s why I’m recommending that you have a conversation with an attorney on something like this because there’s a lot of ways that something like this could go sideways on you, but if you don’t do something to offer a reasonable accommodation here, it seems to me that you would almost certainly be in violation of fair housing law, which is typically not where you wanna find yourself. So all of that, to say that this isn’t to say you can’t necessarily remove a hoarder from their residents. Uh, if the tenant is completely non-operative and refuse any kind of assistance, or they will not comply with any sort of reasonable accommodation, I would think that you would have some sort of a case there for the removal of that tenant from the apartment.
Andrew Schultz: (14:47)
In addition, if one tenant is creating a health and safety concern to other tenants or to the property, I would think that you would have a case there as well. I don’t think that this is going to be easy by any means, but I do think that there are some options out there. If at the end of the day, you can’t get compliance from this tenant and you do have to go through the process of removing them from the home. Hopefully, you’re in able to work through this with this tenant, to help them clear out their hoard and the tenant’s able to access the mental health services that they need because really that’s ultimately what needs to happen here. Um, the tenant needs to get some sort of access to care for the mental health concerns that they have, which in turn hopefully will help them to deal with the hoarding scenario that they find themselves in. Good luck to you As you work through that situation.
Andrew Schultz: (15:35)
Get ready. Rent Prep just recently updated their guide on cash for keys. If you have a stubborn tenant that just won’t leave, perhaps some cash can hurry things along. Learn more about how the process works by visiting rent, prep.com/blog today. That pretty much wraps things up for this episode of the Rent Prep for Landlords podcast. Thank you all so much for listening. We truly do appreciate it. Our goal with the podcast is to help as many people as possible make educated decisions when it comes to real estate, and you can help us to reach our goal. If you heard anything in this week’s episode or any other episode that will help someone, you know, do us a favor and share it with them. If you’re looking to get in contact with me, I can be, you reached over at whatsdrewupto.com from there.
Andrew Schultz: (16:16)
You’ll find links to everything going on with me over at Own Buffalo, as well as other projects that we’re working on. Grab a copy of our free deal analysis tool today over at whatsdrewupto.com. There’s no obligation and it even comes with a companion video to show you how to use it. If you’re looking for top-tier tenant screening sort head on over to rentprep.com, there are multiple products to choose from including tenant-paid options. And if you’re over 50 doors, ask about the enterprise-level programs and pricing. We’ve been enterprise users of Rent Prep for years now, and it’s definitely changed the way that we screen our tenants. Check that out today, over at rentprep.com. Again, thank you all so much for listening. We’ll be back in two weeks with an all-new episode you won’t wanna miss until then. I’m Andrew Schultz with ownbuffalo.com for rentprep.com And we’ll talk to you soon.
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