As a landlord or property manager, you’re well-aware of how important it is to screen your tenants. This becomes more complicated when you’re considering renting to family or friends. When vetting a stranger, you can rely on the information from the screening to make your decision. Objectivity is more difficult when it comes to vetting a friend or family member. They may be a wonderful person, but what will they be like as a tenant? If you’re considering renting to someone you know personally, it’s essential to weigh the pros and cons.
Depending on who you’re renting to, having a friend for tenant could be a great fit. You’ll have an already established relationship and built-in rapport. You’ll likely feel comfortable approaching them if any issues arise and they’ll likely let you know when there’s something that needs to be addressed at the property. Here are some other benefits of renting to friends or family:
- Personal Knowledge of Their Background
One major advantage of renting to someone you know is that you already know them. Unlike renting to a stranger, you won’t have to wonder about their personality or lifestyle. You should have a good idea about their level of trustworthiness, whether they’re reliable, and if they keep their current home relatively clean and maintained. Knowing their personality is also helpful if any disputes or complaints arise.
Make sure, however, that you stick to your written lease. Giving preferential treatment to someone you know could land you in legal trouble – or at the very least, cause future problems for you. Make sure that you’re not overlooking important rental requirements like income or credit score minimums.
- Helping Someone in Need
It feels good to help someone who needs housing. If you have a vacancy and know a friend or family member who’s looking for a place to rent, why not let them know you have a rental available in their price range? Be sure to let them know about your leasing requirements as well. The more they know, the better prepared they’ll be – and with advanced knowledge of the lease, they’re more likely to be a good fit for you as a tenant.
Now that we’ve looked at some of the benefits of renting to friends or family, it’s time to examine some reasons to avoid it.
- Expectation of Preferential Treatment
One potential problem you might face is that your friend or family member expects you to give them special treatment. Having someone you know as a tenant blurs the lines between you both. If they have trouble paying their rent on time, they may expect leniency. They may also try to push the boundaries, whether it comes to paying rent, late fees, or even the “no pets” policy. They might expect you to rush over every time they have an issue at the property. Even worse, other tenants might complain your friend or family member is getting preferential treatment. If you plan to rent to a friend or family member, it’s crucial to establish boundaries.
- Negative Effects on Your Relationship
Any time you mix family and friends with business, there’s the potential for the relationship can sour. As the landlord or property manager, it’s your job to enforce rules and settle disputes that arise between tenants. Sometimes this might involve going against what your friend or family member wants, which could cause tension between you both. It could also extend far beyond that single person – if you evict your uncle, for example, will your cousins stop talking to you? How could this person renting from you affect your other relationships, particularly if problems arise?
Depending on the friend or family member, renting to them could go either way. They might be the ideal tenant or renting to them could cause serious issues in your business or personal relationships. If you decide to rent to family or friends, have an honest conversation with them. Talk to them about your strict leasing policies, the rules of the property, and how issues that arise could affect your relationship. Set clear expectations from the beginning, and you’ll be less likely to have problems when they become your tenant.
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