It’s understandable that having just inherited a house along with the financial and maintenance responsibilities, not to mention the emotions of losing a loved one, the new owner may wish to simply buy some time while sorting through the options. An owner may think that installing a tenant is the answer (at least temporarily) to the issues I described in my last blog post “4 Headaches of An Inherited House”.
But the owner of an inherited house who has never managed a rental before may be in for a rude awakening! Consider these scenarios before putting yourself into a rental nightmare situation – a quick home sale might be a better choice.
- A house new to the rental market, perhaps recently occupied by an aging or sick individual, may need major work to bring it up to code standards for a rental.
- Screening applicants before the lease is signed will have you weighing the implications of the credit issues many individuals carry after years of a bad economy, not to mention a past divorce or foreclosure.
- The laws are strict about landlord do’s and don’t’s. If your tenant turns out to be a disaster of late payments, failure to perform upkeep, and even calls from neighbors with noise complaints, you can’t just chuck ‘em out without going through the hoops according to the law.
- What if they aren’t paying – or are paying late every month? If the house didn’t come with a mortgage on it, as a first-time landlord you may find yourself being too lenient – until they have built a rent backlog it is unlikely they can ever meet. Again, you must follow the legal requirements to take action on rent payment problems.
- Renter phone calls reporting problems such as a lack of hot water or that the air-conditioning stopped working mean that you drop everything and deal with this as an emergency, along with a potentially major outlay of capital funds. It’s even worse if the renter procrastinates telling you about the new lake forming in the basement or the warping front steps. Renters are notorious for not reporting or delaying telling you about problems.
Rentals require a source of backup funds to deal with unforeseen repairs, as well as considerable diligence, patience, and fortitude to deal with renters. If you are wishing for more time before final disposal, or you think it’s too expensive to get the house in shape to sell, a rental could actually make things worse rather than better. A quick home sale to a company like PDX Renovations, who are professionals with such issues, can often be a better long-term solution than renting.
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Question or Prompt for Response – open-ended, relevant
If you’ve been a landlord, what advice do you have for first-timers?
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