Tenants breaking res leases

[KYLECODY]

Have had two seperate tenants in the last few days want out of their years lease which are both roughly 6 months in. Typically I would debate playing hardball on finishing their lease or go the civil route and sue them if they ditch and dont pay or if theyre nice offering to let them break the lease as long as they pay until I get a new tenant. With the recent virus and latest AZ guidelines it looks like any evictions are halted as long as the tenants show they are suffering hardship based on job/income loss which wouldn't be hard to do at this time. Both of these had one of two earners laid off but they can still pay rent if they were decent...I've never had much luck finding tenants that walked away for court purposes trying to recoup rent. Seems to be a waste of time and money if they can't be served. So I'm currently thinking it might be best just to encourage them to walk as opposed to potentially letting them live there for free for several months while this thing pans out with me not being able to evict them for no payment. I may or may not be able to find gainfully employed tenants at this time for this type of home, entry level stuff. Any fellow property owners dealing with this?

 

[Carnivore]

Ouch...

OK, I don't know what to say to you. So I am going to put me in your shoes.

I am not going to be able to file suit for performance. Well I could, but my case will be slow walked at the court. Plus I would be paying cost to do that. The Clerk of Court will probably reject my suit because of tiny errors in the filing. Even if I did manage to have the case put on the docket....the clerk is going set a date further out. Then If I did get a Court Date and stood before the judge he/she is going to Scrutinize my lease for any little blip and throw it out. If the tenants bring up anything where I have not done what I said I would do, Well the Judge is going to throw me out of the Court House . He miight even fine me for some BS stuff.

So, thats not a good route Yet!

Plan B which probably should be Plan A

If its True that I think they can pay. Can I reduce their rent enough to encourage them to stay. In other words how long can I absorb the loss.

I also would try to see if they can earn some rent credit in the form of repairs they might do for me.

I feel bad for you...

 

[jay trotta]

Ouch...

OK, I don't know what to say to you. So I am going to put me in your shoes.

I am not going to be able to file suit for performance. Well I could, but my case will be slow walked at the court. Plus I would be paying cost to do that. The Clerk of Court will probably reject my suit because of tiny errors in the filing. Even if I did manage to have the case put on the docket....the clerk is going set a date further out. Then If I did get a Court Date and stood before the judge he/she is going to Scrutinize my lease for any little blip and throw it out. If the tenants bring up anything where I have not done what I said I would do, Well the Judge is going to throw me out of the Court House . He miight even fine me for some BS stuff.

So, thats not a good route Yet!

Plan B which probably should be Plan A

If its True that I think they can pay. Can I reduce their rent enough to encourage them to stay. In other words how long can I absorb the loss.

I also would try to see if they can earn some rent credit in the form of repairs they might do for me.

I feel bad for you...

Agreed, some rent is better than "0" and you may want to consider not having vacant property; any type of trade off is worthy of thinking at this time. These times require putting an out of the box thinking cap on. Also, many States are beginning to offer "options" and would require continual updating to be on top of the "Options Available"......very trying times we are in.
Good Luck

 

[Denita Neuenhaus]

Agreed, some rent is better than "0" and you may want to consider not having vacant property; any type of trade off is worthy of thinking at this time. These times require putting an out of the box thinking cap on. Also, many States are beginning to offer "options" and would require continual updating to be on top of the "Options Available"......very trying times we are in.
Good Luck

Not having vacant property is huge IMO. I suppose it depends on where you are located, but if some squatter moves in, how are you going to get them out?
Better to have the current tenant with a reduced rent, at least you know what you have in place.

 

[Kitarkus]

Have had two seperate tenants in the last few days want out of their years lease which are both roughly 6 months in. Typically I would debate playing hardball on finishing their lease or go the civil route and sue them if they ditch and dont pay or if theyre nice offering to let them break the lease as long as they pay until I get a new tenant. With the recent virus and latest AZ guidelines it looks like any evictions are halted as long as the tenants show they are suffering hardship based on job/income loss which wouldn't be hard to do at this time. Both of these had one of two earners laid off but they can still pay rent if they were decent...I've never had much luck finding tenants that walked away for court purposes trying to recoup rent. Seems to be a waste of time and money if they can't be served. So I'm currently thinking it might be best just to encourage them to walk as opposed to potentially letting them live there for free for several months while this thing pans out with me not being able to evict them for no payment. I may or may not be able to find gainfully employed tenants at this time for this type of home, entry level stuff. Any fellow property owners dealing with this?

Sorry to hear this. Curious...where do these tenants plan to go?...to live with other family?

 

[Fernando]

It's so important to have good tenants. Some of my rents are low so I don't expect them to leave. In San Francisco with rent control, some rents are so low that if they won't pay rent and fall behind, it works for the landlord if the tenant leaves even if not paying rent to later rent at market rent. So far I had my millenial tenants paying promptly as usual as well as my big box tenant paying on time. My restaurant tenants are having hard time and this morning, I sent them info in getting SBA loans. I had arrangement with one tenant to defer and spread rent over several years. Other I discount by half. I don't really want vacant units. Residentials are easier to rent but have to be selective in choosing financially good tenants. Small business tenants usually takes at least a year to rent out even before this crisis.

 

[CANative]

 

[huntercharlie]

If a residential tenant wants to walk, I let them leave. IMO, too much potential for it to cost more in the long run (i.e. damaging the property, etc.) - I'd rather take the unit back in good condition and go from there. A commercial tenant, I'm not as flexible.

 

[Fernando]

If a residential tenant wants to walk, I let them leave. IMO, too much potential for it to cost more in the long run (i.e. damaging the property, etc.) - I'd rather take the unit back in good condition and go from there. A commercial tenant, I'm not as flexible.

It's easier to rent a residential unit than commercial. There's shortage of housing here and too many commercial vacancies. It's been like that past several years. Small business stores have hard time staying in business. With on line services, it will be worse for physical stores. Being stuck in home, I'm using more online and trying instacart and app food deliveries. It can change how we buy.

 

[KYLECODY]

It's easier to rent a residential unit than commercial. There's shortage of housing here and too many commercial vacancies. It's been like that past several years. Small business stores have hard time staying in business. With on line services, it will be worse for physical stores. Being stuck in home, I'm using more online and trying instacart and app food deliveries. It can change how we buy.

Changing how we buy food, groceries, products, real estate, etc. Probably even how appraisals are done going forward once they analyze the data...Once I started using Amazon a year or two ago I was shocked there were any actual brick and mortar stores around and why I hadn't started doing it sooner.