I'm going to be a bit vague telling my story because my username is recognizable enough to anyone who has ever met me that it would be possible to take what I say here and use it to figure out who I'm talking about. In short, I want to respect the privacy of people who are not me.
I'm a landlord. It's not my only income -- I also have a full-time job -- but it is a significant part of my income. I own multiple rental houses, and for the most part, it's been a rewarding endeavor.
However, an important component of my story is that I'm temporarily skint right now. This is partially a result of having three houses come up for re-inspection by the city in the past 45 days -- all requiring some repairs that cost quite a bit. I say "temporarily" because I have every reason to believe that my financial situation is going to resolve itself pretty quickly. I'm in a pretty tight situation right now, but I don't think that's going to go on forever. My personal situation isn't bad at all.
So what's my problem? One of the realities you learn as a landlord is that even the best tenants are late with the rent sometimes. If you choose your tenants well, it all works out after a few weeks.
A good tenant is a combination of qualities. First, they need to have a steady income. Second, they need to be interested in maintaining their home -- that is, they fix the little things that wear out or break down without bothering the landlord (if the repair is cheap, or if they know something broke because of something they did). But they also need to be the kind who aren't shy about calling the landlord if something breaks that the landlord is responsible for (appliances that came with the house, electrical and plumbing systems, furnaces, roof leaks).
Not being afraid to call the landlord when something needs fixing is an important component of the relationship.
Unfortunately, I have a couple of tenants who, for whatever reason, seem reluctant to "bother" me when things need fixing.
The normal wear and tear of living in a house is going to cause things to break or wear out. I know this, and I'm not going to kick a tenant out because the dishwasher or refrigerator broke down.
In my town, the city inspects and recertifies rental properties every two years. So, with three inspections falling quite close together (because when I first got into this business, I quickly renovated and rented out three houses), it was a bit of a financial blow to me to have to do a laundry list of repairs in the past few weeks, that I could have handled easily if they'd been reported as they happened.
(To anyone who is a renter who reads this: Take note, your landlord will probably thank you for reporting problems quickly. It keeps them from getting worse, and it allows him/her to do these things one at a time rather than all at once.)
But that's just background.
I have a tenant who is substantially behind in rent. This also puts pressure on my finances. The tenant is not a deadbeat. It's a difficult situation -- under-employment, not enough money coming in. Section 8 isn't taking new families at the moment (nor have they for the two years I've been managing rentals).
I don't attempt to manage my tenants' finances or lives. I tell them when they sign the lease: You won't see me unless you call me with a problem. This is YOUR house while you're renting it from me. I don't care about your politics, your marital status, your sexual orientation or your ethnicity, your religion or lack thereof. I care that you pay your rent and do routine maintenance on your home. I will not peek through your windows or drive by to see how you keep your yard. If the city calls me saying you're in violation of some part of the code, I'll call you and we'll discuss mitigation.
The tenant I'm talking about got behind gradually. The situation has been building for about six months. They are trying to catch up, but failing. They keep giving me what they can, but it doesn't come up to the full rent -- let alone catching up.
I try to work with tenants when they get behind. I don't charge late fees, because I think it makes little sense to make people owe more when they can't make the normal rent. I don't get angry or threaten people when they're behind. I simply ask them to do their best to catch up. It usually works.
But I fear, with this tenant, we're going nowhere good. They aren't going to have more money in the foreseeable future. They simply can't afford my house.
It's bothering me a great deal that I may have to ask them to leave. There are less expensive houses to be had, but I wonder who is going to rent to people whose financial situation is as bad as what I'm seeing.
In short, I'm afraid that if I evict this tenant, a family will become homeless. I'm also afraid that if I let them stay, I'm committing to losing money on this property after my costs for taxes, insurance, maintenance and service to the debt incurred when I renovated the house. And it will be long-term, because I don't think they have any intention of leaving if they can avoid it.
I'm cruising toward retirement from my regular job these days. It's not imminent, but it's coming (in about 6 years). I'm on a fairly strict financial plan to get my situation in order before retirement comes, so I can live comfortably (not lavishly) on my social security and the income from my properties.
So losing money on one of my houses would be a fairly bad thing for my future. My currently sinking cash flow will start righting itself as soon as I get a vacant house I've been working on rented. But I'm not going to make my long-term financial goals unless I've got full rent coming in from all my properties.
And that is the landlord's dilemma. I'm not Snidely Whiplash. I got into this because I thought I could do some good, while building a retirement income. I wanted to provide good, comfortable homes for families who can't afford to buy a place, at a reasonable price. I wanted to rehab dilapidated houses into good family homes.
So, here I am, stuck between compassion and financial realities.