Pros and Cons of Befriending Your Tenants
Mixing business and pleasure is hardly ever a good idea. Renting a home to a tenant is a business transaction, too, so the same rules apply. As a property owner, you may get in a situation when a friendly chat turns into a coffee together, then an occasional dinner party, and finally, regular phone chats. Should you hit the brakes at the first coffee invite? Or is it okay to establish a closer relationship with your tenants? Before we go over the pros and cons of befriending your tenants, let’s just say that there are many reasons why people hire professional property management services. Sure, it’s mostly because property owners typically don’t have the time to handle the management side of renting. However, there is also the issue of communication and problem-solving.
Pros of Befriending Your Tenants
Although the introduction hints at the fact that the disadvantages outweigh the advantages, we can’t deny that there are some benefits of becoming friends with your tenants. It’s like renting to a friend; only it’s a friend you have recently made.
Ensuring a Consistent Stream of Income
Of course, there are no guarantees, but if you are friends with your tenant, the chances of them regularly paying rent are greater. If you have a close relationship, they will probably feel bad if they are late with their payments.
Knowing Your Property Is Well-Maintained
If you have a friendly relationship with your tenants, you can expect them to take better care of your property. Especially if you are going to stay friends once they move out, your tenants will not want to leave the place dirty or damaged. Also, they will be more likely to follow all the rules.
When you are friends with someone, there has to be mutual respect. And if one party doesn’t follow the rules established by the other or does anything to the detriment of the other party, there can’t be respect.
Again, no one can guarantee that things will play out that way. Still, the chances that they do increase.
Visiting Your Property More Often
If you befriend your tenants, you will likely have an opportunity to inspect the place more often. Also, if you need to perform some repairs or renovation, your friends may be more flexible about it.
Cons of Befriending Your Tenants
There can always be the temptation to become friends with a tenant, whether you are a property owner or a professional property manager. If you are a property owner, you may want to greet the new tenants when they move in nicely, they may invite you to a move-in party, and you will want to get them something nice as a gift. If this happens, you can find yourself in two situations:
- You have hired a property management company and managed to befriend your tenants
- You are managing the property yourself and have become friends with your tenants
Both scenarios are problematic.
If You Are Working With a Professional Property Manager
Possibility of Miscommunication
You know the saying – two’s a company, three’s a crowd. Nothing could be more true. When several parties are involved, it creates a lot of room for issues. For starters, the tenant may not know who to report to and contact if there is an issue. They could also say one thing to you and another to the property manager. The reverse is also true. You and the manager may provide the tenant with differing information. Or you may say something that the property manager is not aware of and create additional problems. Also, if there is always a middleman when information is passed, the chances of miscommunication increase substantially.
Problems With Rent
If you befriend a tenant, they may persuade you not to increase their rent or increase it less than you need to. Renting is your business. So, doing things like that is detrimental for you. Your rent needs to follow rental market trends and local legislation. Otherwise, renting won’t be worth it.
The Property Manager Is Your Buffer
These professionals communicate with tenants on your behalf. And they can do so more efficiently and more effectively if you are not involved.
Moreover, the tenant will likely perceive you as a higher authority. So, in case of any issues or need for communication, they may entirely disregard the property manager. If they have established contact with you, why would they call the person who “works for you.” But this is a problem for you. You hired the manager because you can’t deal with tasks and issues concerning the property.
Furthermore, if something needs repairing, the property manager should decide if it is so. If there are issues, they are the ones who should decide how to handle them. If you get involved, and there is three-way communication, things can get messy. And in most scenarios, they will.
If You Are Managing the Property Yourself
Since there is no buffer, you have to maintain a professional relationship with your tenant. Otherwise, you may run into trouble.
Tenants May Not Perceive You As an Authority Figure
If you are perceived as a friend, it’s easy to expect that you will be lenient. This can result in late payments, lease violations, and a whole host of problems. Since you are friends, you may give in to your tenants’ requests to avoid awkwardness. It can only translate to more problems for you. Plus, if the situation lasts, the relationship will sour anyway.
Moreover, if you allow your tenant to break the rules once, can you be certain the situation will not repeat. It’s hard to draw the line once you have allowed them to break the rules.
Tenants May Be More Relaxed With Maintenance
Just like they can pay more attention to the property because you are friends, they can just as easily neglect it. At the same time, even if they are responsible and flexible about maintenance and necessary repairs, be ready for trouble if there is money involved.
What if You Have Multiple Units?
Imagine what it would be like if other tenants found out that you are giving preferential treatment to some. If you have several units to rent, it is imperative that you treat all the occupants the same way. You can’t be lenient to some but strict to others. It’s in your best interest to be tough with all of them.
The Bottom Line
As you can see, the cons of befriending your tenants largely outweigh the pros. In fact, compared to the issues you could run into, all the advantages are pretty insignificant. Ultimately, you can avoid all the problems if you work with a professional property manager and let them handle your rental units.