Author Topic: Celebrity tenant?  (Read 5518 times)

UKMustache

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Celebrity tenant?
« on: May 25, 2017, 01:49:26 AM »
I've got an unusual situation and I'm a first time landlord so I wondered if the more experienced among you could give some guidance.

We have a property which is a newly refurbished 3 bed detached bungalow with a nice garden. 
It has been advertised for the last couple of weeks and while it has had a steady stream of viewings we haven't yet had any applications.  While it isn't incredible, it is the only newly refurbished (detached) property in the area.

Yesterday a man did an accompanied viewing with the agent, he brought a video camera with him.  He walked through the property and said he will report back to his friend (who is from out of town) to see if he wants to come and see  it in person.

Following the viewing, the man got in touch with the agent and asked for their absolute discretion. 

His friend is actually his client and his client is a celebrity (and I don't mean a wannabe, he's a retired world level athlete). 
He is getting divorced and so far the press are unaware.  He wants to keep it that way. 

His (soon to be) ex wife lives about 10 minutes from my property in what is I think the most expensive house on this side of the city (this is common knowledge).  His reason for renting is that he wants to be near enough to still take the kids to school while the divorce goes through (so as to keep up appearances) but doesn't want to buy anywhere as he's unsure what he's doing long term.

My first though was 'this is bollocks and it is a scam' however we've now had application papers through and a copy of his passport, it all seems to checkout and I'm going to insist on a face to face with him to sign the tenancy if we do proceed just to make sure he is who he says he is.

Now onto the tricky part, he is willing to complete an application but doesn't want to provide details of his income and be credit checked because of the upcoming divorce (presumably because he's going to fudge the numbers to make himself look broke and a piece of paper with the actual number on could fuck all of that up).  I found his company accounts (public information) and it currently has 20+ million in the bank, I'm not overly concerned about him affording the rent.  His directorship appears to pay him 50 times the annual rent per year.

He wants to pay 6 months rent upfront to circumvent the credit check and income questions.

The agent is very keen for me to accept this (of course he is, he gets his fee) however I feel like maybe I've missed some massive downside?  Honestly up until the point where we got a copy of his passport I thought it was just an elaborate scam so they could set up a drug factory in my property, but now I'm not sure.

I'm thinking of responding to the application as follows..

I appreciate the situation you find yourself in and your reasons for not wishing to follow the usual application procedures. 
I hope you will understand that this deviation also creates some issues for me as a landlord. 
My usual tenancy period is 12 months and I would require you to adhere to this (paid in advance); a 6 month tenancy would end just prior to Christmas and it would be difficult for me to find replacement tenants if I allowed a shorter term.
I would also require a higher deposit to cover the risk of damage to the property, there are several articles online giving instances where criminals have targeted you personally and I consider this a higher risk to lower profile tenants, a deposit equivalent to 6 months rent would sufficiently cover this additional risk.


Am I being reasonable?  Have I missed anything?

Sydneystache

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Re: Celebrity tenant?
« Reply #1 on: May 25, 2017, 01:59:20 AM »
Are you asking for 12 months paid in advance? Or just that he adheres to a 12 month tenancy?

I wouldn't mention about "articles online". A bit superfluous. I am a bit sympathetic to your tenant though. He's a celeb and he's putting his privacy/security in your hands. You have already checked him out and what is stopping you from blabbing to The Sun or Daily Mail about his impending divorce? You're already on here telling too much info about his situation so I would feel uncomfortable about that.

If the celebrity thing is too much for you, don't have him as tenant. You're already thinking about acts of possible damage because of his higher profile (stalky fans?). Can you live soundly with yourself for the next 6-12 months while he is a tenant? If not, then say sorry dude I'd prefer my tenants to be less in the spotlight.

UKMustache

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Re: Celebrity tenant?
« Reply #2 on: May 25, 2017, 02:06:36 AM »
Are you asking for 12 months paid in advance? Or just that he adheres to a 12 month tenancy?

I wouldn't mention about "articles online". A bit superfluous. I am a bit sympathetic to your tenant though. He's a celeb and he's putting his privacy/security in your hands. You have already checked him out and what is stopping you from blabbing to The Sun or Daily Mail about his impending divorce? You're already on here telling too much info about his situation so I would feel uncomfortable about that.

If the celebrity thing is too much for you, don't have him as tenant. You're already thinking about acts of possible damage because of his higher profile (stalky fans?). Can you live soundly with yourself for the next 6-12 months while he is a tenant? If not, then say sorry dude I'd prefer my tenants to be less in the spotlight.

The OP is sanitized and there's no way anyone could extract who this person is from the post, I work with very wealthy peoples personal information (I'm a tax inspector for the affluent division of HMRC) so I'm aware of the need for discretion.  I re-wrote it a couple of times and changed some facts so it's materially the same but he isn't identifiable from it :)

I'm asking for the 12 months in advance, that way it isn't really important to me what he's earning at all so I don't need his income details which suits us both.

Villanelle

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Re: Celebrity tenant?
« Reply #3 on: May 25, 2017, 02:10:36 AM »
If you are going to insist on the 6 mo deposit, I'd make it very, very clear that it will be fully refundable assuming there is no damage.

It seems like you want him to pay 12 months in advance, plus a deposit equal to 6 mo. rent.  Admitedly, I am not part of The Rich and Famous, but that seems excessive.  If you want a 12 mo. lease, fine. And I suppose it's not so much to ask that he pay it all in advance, given that he won't let you do a typical credit check.  But a 6 mo. deposit??

What is your normal deposit?  Sure, people may target him.  OTOH, he's a high profile guy, and from the sounds of it, ridiculously wealthy, so he can afford to pay for a busted window or damaged floors. 

It seems like you are having trouble renting the place, so I wouldn't be too aggressive with this guy as it appears you kind of need him.

UKMustache

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Re: Celebrity tenant?
« Reply #4 on: May 25, 2017, 02:18:59 AM »
If you are going to insist on the 6 mo deposit, I'd make it very, very clear that it will be fully refundable assuming there is no damage.

It seems like you want him to pay 12 months in advance, plus a deposit equal to 6 mo. rent.  Admitedly, I am not part of The Rich and Famous, but that seems excessive.  If you want a 12 mo. lease, fine. And I suppose it's not so much to ask that he pay it all in advance, given that he won't let you do a typical credit check.  But a 6 mo. deposit??

What is your normal deposit?  Sure, people may target him.  OTOH, he's a high profile guy, and from the sounds of it, ridiculously wealthy, so he can afford to pay for a busted window or damaged floors. 

It seems like you are having trouble renting the place, so I wouldn't be too aggressive with this guy as it appears you kind of need him.

Sorry, context for jurisdiction maybe needed here.

In the UK all deposits have to go into a registered independent deposit scheme. 

At the end of the tenancy if a landlord wants to make a claim for damage they make the claim to the scheme, the tenant can then make a counter claim and the scheme decides what is reasonable. 

The deposit would have to be put into a scheme by law, though I'll make sure he's aware of that.

The usual deposit would be 1 month but I reasoned that a larger deposit would cover the risk of some lunatic trashing my house because of who he is.  Maybe 6 months is unreasonable, 3 months isn't unheard of, perhaps that would be more reasonable.  Thanks for the reality check :)
« Last Edit: May 25, 2017, 02:23:24 AM by UKMustache »

Sydneystache

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Re: Celebrity tenant?
« Reply #5 on: May 25, 2017, 02:52:37 AM »
The usual deposit would be 1 month but I reasoned that a larger deposit would cover the risk of some lunatic trashing my house because of who he is.

Don't you have landlord insurance? Should cover damage. Maybe better ring up your landlord insurance company and ask them about their policy on risky tenants.

UKMustache

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Re: Celebrity tenant?
« Reply #6 on: May 25, 2017, 03:02:51 AM »
The usual deposit would be 1 month but I reasoned that a larger deposit would cover the risk of some lunatic trashing my house because of who he is.

Don't you have landlord insurance? Should cover damage. Maybe better ring up your landlord insurance company and ask them about their policy on risky tenants.

Yes but there's excesses on that, I'll get in touch with them today and see what they say.

texastumbleweed

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Re: Celebrity tenant?
« Reply #7 on: May 25, 2017, 12:08:32 PM »
Ooh ooh is it david beckham? ;)

UKMustache

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Re: Celebrity tenant?
« Reply #8 on: May 26, 2017, 12:26:11 AM »
The usual deposit would be 1 month but I reasoned that a larger deposit would cover the risk of some lunatic trashing my house because of who he is.

Don't you have landlord insurance? Should cover damage. Maybe better ring up your landlord insurance company and ask them about their policy on risky tenants.

There's nothing in my policy about it, the only conditions are that every tenant must be credit checked and provide independent references. 

He has agreed to a 3 month deposit and a credit check.  I've volunteered that perhaps his accountant could provide a reference as he's not 'employed' in the typical sense.  I've also made clear that paying upfront doesn't buy him exception of any other rules, the periodic inspections still apply and it goes without saying that he adheres to the tenancy agreement re:noise, damage, smoking and pets etc.  He's happy with all of that and has also advised he intends to get a cleaner and a gardener weekly to take care of the property. 

Ha, yes it's David Beckham, don't tell anyone.  :D

Sydneystache

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Re: Celebrity tenant?
« Reply #9 on: May 26, 2017, 04:34:08 AM »
Well it sounds as if he's agreed to all your conditions then.  Just make sure your property managing agent, when he writes up the rental contract, gets what YOU WANT in writing and what HE SAID he'd do in writing as well. A weekly gardener and cleaner will be a variable cost for him and he might stop using them after a month or so especially if ex-wifey turns the screws on him financially.

Make sure you take photos/videos of  your property before you rent it out as the "before" picture so if there's any damage you can refer to it. Photos of ceilings, walls, carpet  etc pay attention to detail when documenting your property. If there's any water/smoking damage etc they'll show. The grounds too eg your plants that may be neglected and die during the rental period.

At the end of the day it's your investment and you need to ensure whoever is renting it takes good care of it. Works both ways of course- if there are leaky taps etc you'd better fix them before he moves in. Make him feel welcome 🙂

PS I once bought a new welcome mat for my former tenants. Unfortunately they stole it when they left 🙁

UKMustache

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Re: Celebrity tenant?
« Reply #10 on: May 26, 2017, 04:44:43 AM »
Well it sounds as if he's agreed to all your conditions then.  Just make sure your property managing agent, when he writes up the rental contract, gets what YOU WANT in writing and what HE SAID he'd do in writing as well. A weekly gardener and cleaner will be a variable cost for him and he might stop using them after a month or so especially if ex-wifey turns the screws on him financially.

Make sure you take photos/videos of  your property before you rent it out as the "before" picture so if there's any damage you can refer to it. Photos of ceilings, walls, carpet  etc pay attention to detail when documenting your property. If there's any water/smoking damage etc they'll show. The grounds too eg your plants that may be neglected and die during the rental period.

At the end of the day it's your investment and you need to ensure whoever is renting it takes good care of it. Works both ways of course- if there are leaky taps etc you'd better fix them before he moves in. Make him feel welcome 🙂

PS I once bought a new welcome mat for my former tenants. Unfortunately they stole it when they left 🙁

The inventory is done by a third party company (included in the agents fee) and will include 360 degree pictures of every room with high res pictures of each part too.  I've seen an example and it's impressively detailed.  The property is immaculate as I've renovated it completely, so it's important for me to document that. 

Assuming he provides what we agreed, I should be a landlord as soon as a fortnight! 

Ha, we've put welcome mats down already (to protect the new carpets just a little).  I'll budget to replace them after the tenancy :)

Sydneystache

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Re: Celebrity tenant?
« Reply #11 on: May 26, 2017, 05:00:57 AM »
Sounds good. Happy landlording!

Timmm

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Re: Celebrity tenant?
« Reply #12 on: May 26, 2017, 07:01:59 PM »
That's pretty cool, UKMustache! I'd be a little nervous with my first lease being so unusual, but it all sounds pretty safe and legit to me. Ordinarily, we are very leery about proposals to pay rent in advance - in the US, this introduces a major obstacle to eviction. But in this case, it seems that's really not the issue. The tenant is offering it in consideration of skipping the credit check, but it sounds like that's clearly not an important verification in this case.

I'm not sure I'd raise the prospect of crime for the extra deposit issue either. That seems a bit creepy/morbid - your tenant seems safely "collectible" if he's liable for any damages, and I would expect your own property insurance to be the main party in an example like that. Asking for an additional deposit may be fine, especially as it seems he won't have any worries about getting it back appropriately.

A full 12 month term is a very reasonable and sensible demand. Not just for minimizing your tenant turnover, but as you say, winter vacancies can be very slow to fill. If 6 month occupancy is really all he wants, I'd consider offering that but at something like the cost of 7 months.

Wealthy people can still damage property or simply fail to pay debts, so there's some risk even here. But you won't find any tenant, ever, without accepting some risk. Your description sounds like a great option.


marty998

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Re: Celebrity tenant?
« Reply #13 on: May 26, 2017, 07:31:52 PM »
I'd just re-write the lease as 7 months if you are concerned about Christmas vacancy.

Did that with a lease last year to avoid it terminating on 20 December.