Author Topic: Creative Compromise For Potential Tenants that want a longer lease?  (Read 3018 times)

riotnerd

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Hi folks.  My wife and I have decided to do some traveling and have our San Diego house listed for rent with a 1 year lease.  We are leaving mid-February, so still have a little bit of time...but not a ton.  In addition to enjoying the sites...the trip will also double as a scouting mission to see if there are any other areas (with cheaper standards of living) we might want to live more permanently.  So in short, we may or may not want come back and live in this home ourselves, and if we do choose to relocate...we may or may not want to keep the house as a rental....it would probably depend on if we needed cash to buy another home somewhere else.   

We have had several parties that seemed interested, but want a place they will not have to vacate in a year.  I don't blame them.  We have told them they MIGHT not have to, but we cannot commit past a year. 

Is there any creative compromise you can think of, or should we just keep looking for tenants that don't care about the longer term?  Maybe a longer lease with some kind of penalty for us if we kick them out early?  We could also theoretically just rent somewhere else if we do want to come back to this area. 

Thoughts?

TacosForever

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Re: Creative Compromise For Potential Tenants that want a longer lease?
« Reply #1 on: January 04, 2014, 01:31:50 PM »
That's tough. Most people who would be looking to rent a house are going to be interested in a more long-term situation.

Maybe since you're in San Diego, you could advertise to businesses or universities who might be looking for a place to house execs, professors or contract workers on temporary assignments? Sometimes those can extend for a year or year and a half. Not sure how "fancy" your place is or whether you'd be able to leave it furnished, but something to consider.

riotnerd

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Re: Creative Compromise For Potential Tenants that want a longer lease?
« Reply #2 on: January 04, 2014, 01:37:05 PM »
Thanks Tacos.  That's a good idea...we will look into it.  Our place is pretty nice, in my biased opinion....and we actually did prefer to leave it mostly furnished....less storage fees for us. 
« Last Edit: January 04, 2014, 01:49:23 PM by riotnerd »

Paul der Krake

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Re: Creative Compromise For Potential Tenants that want a longer lease?
« Reply #3 on: January 04, 2014, 01:50:37 PM »
If it's in a desirable location, could you have a friend keep an eye on it and rent it on AirBNB?

honobob

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Re: Creative Compromise For Potential Tenants that want a longer lease?
« Reply #4 on: January 04, 2014, 02:39:51 PM »


Is there any creative compromise you can think of, or should we just keep looking for tenants that don't care about the longer term?  Maybe a longer lease with some kind of penalty for us if we kick them out early?   

Thoughts?
Penalty for YOU, the owner for terminating at the end of a ONE year lease?  NO!  What happens if their life changes and they want to leave after the lease ends?  What is their penalty?   
1.  Bad tenants always want a multiple year lease because they will leave when they want to and they know it entices rookie landlords to rent to them despite the warnings!
2.  What would it be worth to you to tie up your property for more than one year, 50% more rent starting now and then applied to rent in year two or three?  Then if they leave after year one you have six months of extra rent.  If they stay your could renegotiate on YOUR terms and agree for them to pay market rent and you'll apply the above market rent to the last 6 months or whatever works for BOTH of you at that time.
3.  During booms I've had tenants concerned about me selling out from under them but I've only shown my track record of holding properties and having long term tenants.  I would NEVER formally commit to more than one year unless THEY were making it worth my while.

riotnerd

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Re: Creative Compromise For Potential Tenants that want a longer lease?
« Reply #5 on: January 04, 2014, 05:26:43 PM »
Well it would be a longer...3 year lease, but giving me an out after 1 year if we really wanted to move back....but yea...all valid points.  We will keep looking for a tenant that is less concerned with what happens after a year is up. 

Blindsquirrel

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Re: Creative Compromise For Potential Tenants that want a longer lease?
« Reply #6 on: January 20, 2014, 01:22:44 PM »
   Just use a standard 1 year lease that goes month to month after the first year. Pretty standard in Oh.I would make no mention of your plans other than to rent the house to your tenants per the terms in the lease. We have one set tenants who have lived in our house for 12 years, (love these folks, they bought the GD house for us 2x and never call),  others are at 10, 10, 8, and 9 years using a 1 year lease that went month to month. It is a business.

Beaker

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Re: Creative Compromise For Potential Tenants that want a longer lease?
« Reply #7 on: January 20, 2014, 07:49:20 PM »
FWIW, I had neighbors who would rent out their place for corporate medium term leases (typically 1-3 months). They'd just go traveling every time it rented. Worked out great for them, as rents were really high and the quality of tenants was good. They require a furnished house for that sort of rental, for obvious reasons. There was at least one site that brokered such things, but the name escapes me now.