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When I do lease renewals, if I want to renew a lease, I typically submit a document to tenants about a week before the 60-day renewal time with 3 renewal options for the existing tenants: 12-month at new rate, M2M at new rate or not to renew.
One of my properties has a sewer backup issue. Twice in the past month the master bathroom has flooded. We have had 3 inspections, including the city’s engineers, and cannot get concensus on the real problem. The city inspections say there’s no problem on their side of the street junction but there’s a break in the “right of way” behind the house. Our inspector says the problem is on the city side, but there’s also 3 breaks in the pipes and our sewer drains to an old line in the back of the house. We’ve been having the system rotor rooted about 2x a year for the past 2 years. We are getting another (camera scope, 3rd time) opinion this week. If we can get 2 consistent answers we will address the issue immediately. We have been getting repair quotes from zero (it being the city problem) to $9500.
Our tenants are quite upset. They have an 8-week old baby and feel the environment is not sanitary. And now we are coming up to the 60-day lease renewal. They have been ok tenants. They pay on time. Our rent is extremely reasonable, perhaps under market by about $200/month. At lease renewal, I was going to increase the rent by $100/mo.
Would you go ahead and follow my existing procedure for the rent renewal offer or do something else such as extend the rent as is for an additional month and make the increase effective in 90 day? Or???
Don’t need help with issue at present, question is about renewal offer.
Problem will obviously be resolved within the 60-day renewal period. Our TX leases have a 60-day renewal notification. Question specifically asks how to handle the renewal offer NOT what to do NOW.
If you increase the rent, more than likely they will leave. Even if you say you will defer the increase for 90 days, they'll see that as unreasonable as they're unhappy today and can't see what things will be like in the future. You should leave it as it is if you're wanting to keep them as tenants.
If I was renting and the sewer backed up twice in a month, I’d be outta there real quick, end of lease or not.
Yes, we have given the tenants that option to find another place without penalty. I’m certainly not minimizing their inconvenience or discomfort. And if they chose to move, I am more than OK with it. They are high maintenance tenants who don’t take especially good care of the house. But that’s not really relative to this issue and we are doing our best to get resolution to the issue.
We already reduced the rent last month (it happened right before rent was due.) Its an exceptionally nice house in a great location with complete privacy in the backyard — no rear neighbors; and with their reduced rent (for 2 overflows that were confined to the master bathroom) they are about $400 below market.
Last edited by WorldKlas; 09-11-2018 at 05:58 AM..
When I do lease renewals, if I want to renew a lease, I typically submit a document to tenants about a week before the 60-day renewal time with 3 renewal options for the existing tenants: 12-month at new rate, M2M at new rate or not to renew.
One of my properties has a sewer backup issue. Twice in the past month the master bathroom has flooded. We have had 3 inspections, including the city’s engineers, and cannot get concensus on the real problem. The city inspections say there’s no problem on their side of the street junction but there’s a break in the “right of way” behind the house. Our inspector says the problem is on the city side, but there’s also 3 breaks in the pipes and our sewer drains to an old line in the back of the house. We’ve been having the system rotor rooted about 2x a year for the past 2 years. We are getting another (camera scope, 3rd time) opinion this week. If we can get 2 consistent answers we will address the issue immediately. We have been getting repair quotes from zero (it being the city problem) to $9500.
Our tenants are quite upset. They have an 8-week old baby and feel the environment is not sanitary. And now we are coming up to the 60-day lease renewal. They have been ok tenants. They pay on time. Our rent is extremely reasonable, perhaps under market by about $200/month. At lease renewal, I was going to increase the rent by $100/mo.
Would you go ahead and follow my existing procedure for the rent renewal offer or do something else such as extend the rent as is for an additional month and make the increase effective in 90 day? Or???
Suggestions?
I realize your question is directed to LL, which I am not, but some things to just think about:
When the repair happens, will water service to the house be disrupted? If so, for how long? If for an extended duration, would it be better for the house to be vacant during the repair? (Someone I know had their bathroom & kitchen renovated this summer, and they had no water for 6 weeks )
Is it worth $1200 to find new tenants? Maybe so if they are high maintenance and don't treat the property well. Maybe not if you consider the advertising, screening, etc. etc. with putting new tenants in place.
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