Early Turnover on Rental House #2

We had our first lease breakage on a rental property at the beginning of the year. The tenants had moved into House #2 in August on a 1 year lease and everything was working extremely well. The tenants were very low maintenance, never had any problems with late rent, and we were bringing in a higher rent than the previous lease.

Things quickly went south right before Thanksgiving. I got a call from the tenant saying the backdoor of the house had been kicked in and the they were robbed. Obviously the tenant was distraught, it was an unfortunate incident, we were going to be several hundred $$ for repairs, but I expected this to eventually blow over. I wrote it off as a sign of the times with the economy tanking and this property's location near downtown.

I immediately hired a contractor to come out and secure the back door within hours and eventually repair it. I even had the contractor replace the door with one without windows because the tenant indicated she would feel safer with it. Within a week we had the damage completely repaired and I thought things would get back to normal.

About 2 weeks later the tenants notifies me that they no longer feel "safe" at the house and want to move out. They had found a new place and wanted to know how they could end the lease. I felt terrible for them since they had been robbed, and understood that the no longer felt safe so I wanted to help them as best I could. Timing couldn't have been worse given it was in the middle of the holiday season so I said I would put the house up for rent and as that they cover rent until I find a replacement then I would be willing to terminate the lease.

By the end of December I was getting a little concerned - the holidays were about over, but I really wasn't seeing any interest in the house. Given we had just closed on our new home, we weren't in a position to leave the house vacant for a prolonged period - even if the tenant agreed to keep paying rent - I knew once they were out it would be hard to get any additional rent from them.

Luckily the 1st week of January I finally had a trickle of people interested in the house and had someone who was interested in signing a lease if I would lower the rent $40/mo. After the prospective tenant checked out I agreed to reduce the rent with an 18month lease which would help me get the house back on a typical summer rerent cycle which will make it easier to get the house rented again.

I guess this is in-line with this article that suggests Raleigh area rent rates are dropping significantly.

Related in Rental Property:

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Why Invest in Rental Property (Mar 13, 2012) The real estate investing infomercials of the housing boom suggest that real estate could make you rich - the benefit of real estate being exponential returns of your investment. While I only have a few small real estate investments there...

Rental Property Investment Breakdown (Sep 27, 2011) Here is some overdue financial record keeping from our latest rental investment in August 2011. This breaks down all our out of pocket costs to purchase the property and get the 1st tenant in place. Out of Pocket Investment in...

Comments (6)

So how does that work when renting a house? Did you charge them a reletting fee like an apartment complex would charge, or did you just let them move out when you found a new renter? Likewise, did you inform the new renters of the previous break-in?

That seems like a lot of money out of your pocket. I realize the situation was somewhat difficult as you wanted to be nice to these people, but to have you pay for the door and then bail in the middle of a lease is irresponsible renting, in my opinion. Although, on the plus side, at least they didn't up and leave until the new renter's were lined up.

Good luck with that!

Well that certainly seems like a gray area. Its not really spelled out in the lease - the lessee is legally obligated to fulfill the lease contract, anything less than that it appears is flexibility on part of the lessor. I offered to let them out of the lease obligations once I found a replacement renter since these were unfortunate curcumstances for the lessees (and me). My reletting fee would be the cleanup charges related to getting the house ready to rerent.

I didn't lose much money out of pocket, more my time to show the house, rerent it, etc which I guess is the same thing as money in this case.

Curious who you contracted out the door repair to. I need to replace a back door. Who did you use int he triangle? What did they charge you? I am looking for a decent recommendation and I am looking to not get ripped off here...don't have the money for it. Thanks

Hi...I'm a long-time landlord and this "robbery" story is a familiar one to me. Did you personally see the damage done to the property? Did you or your tenant file a police report? Did the tenant notify the police before contacting you? Did the tenant maintain renter's insurance for their belongings? I have had several staged "robberies" over the years and it always coincides with a tenant's desire to move. I'm not saying your tenant was BSing you, but your story, on its face, seems odd.

Well just be thankful you have someone who can move into the place on such short notice.
40 per month equals 360 less per year than the other people, but if you secure them for 18 months it's better than the people before who probably paid for 3, right?

Hello, was police report made in the roberry attempt event? The way I read it and as a landlor myself, I am suspicious of the move motivation. I would recommend books by Leigh Robinson: (1) Landlording (2) What's a Landord to do?

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