Who reduced rent for the tenants?
Yesterday we sent message to our tenants that we reduce rent by 5% till the end of the year considering pandemic.
To the best of our knowledge both families are still have the same employment situation as at the time when they moved in.
However, one family left the city during lock down and asked us for rent reduction of 25% because they do not live in the apartment. We refused at that time.
We are family of professionals, one of us learned that his contract will not be extended till the end of the year.
Diary of a small landlord indeed.
How other small landlords handle the situation?
lucie
in General Discussion 5 years ago
27
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27 replies
lucie | 5 years ago
Yes, I think we are on the same page.
1. We actually planned to raise rent for both of our tenants this year. We hate to do this and it took us some time to contemplate 🙂 We planned to do this the way we halndled this before: we write to our tenants and ask them to raise rent to what they will be comfortable and reasonable. It worked before. But while we were fidgeting with we hit pandemic situation.
2. We gave our tenants who left one month $150 discount ( actually they sent less $200 🙂 ) for the absence and not using utilities.
3. We thought it was not fair to our other tenants who stayed and we send message to both families that we cut %5 till the end of this year.
4. Also, we will give another $150 for tenants that are away till they are away.
I wanted to get a feel from Brownstoner community if this is reasonable.
I do not believe that Park Slope rental market is crushing. We are landlording for 16 years. We never had vacancies and our normal mode is to race to do renovations in 2 weeks between tenants with leases already signed. So, I am pretty optimistic.
Chas373 | 5 years ago
Olga , I’m sorry if I sounded as though I was saying you’re unreasonable. That was not what I meant at all. And in fact one of my tenants also has been with me for 6 yrs and they too are under market as it is now. They are quarantining out of the City, but have paid the rent and did not ask about a reduction. I do understand your position and I’m sorry to hear that one job for you will not be bringing income. My mindset was to advise as to how to keep the tenants for long term. You are right there comes a point where it’s not worth it just to have the apartment filled but it still isnt enough to cover your expenses. I do see you have made attempts to be reasonable. and hopefully it will all fall into place for you. I’m hoping that anyway.
NewOwner | 5 years ago
Both of the tenants in our brownstone left for the time being. Their rents are also below market. We offered each a $100/monthly reduction, clearly laying out that most of our operating costs are fixed and that the reduction represents the likely decrease in water and reduced garbage day effort.
lucie | 5 years ago
Why I would accept 25% reduction? They were under market already, we never raised rent in 4 years. They did not mention that employment situation is changed for them.
We are giving them another 150 discount for not using utilities ( like water) . In all the fairness OUR employment situation is changed. One of us will not get an income from his job for some time. We do not ask anybody to do anything for us 🙂
If they will not be happy – so be it.
I am sympathetic to my tenants and willing to reduce rent even more if, god forbid, their income suffers due to coronavirus lockdown and they show me this.
We did not raise rent since tenants moved in ( in 4 years and in 3 years) and we already reduces rent till the end of the year for 5%.
Our tenants did not tell us that they lost jobs, I know that they are able to work remotely.
I hope that we are reasonable in our approach.
lucie | 5 years ago
Why I would accept 25% reduction? They were under market already, we never raised rent in 4 years. They did not mention that employment situation is changed for them.
We are giving them another 150 discount for not using utilities ( like water) . In all the fairness OUR employment situation is changed. One of us will not get an income from his job for some time. We do not ask anybody to do anything for us 🙂
If they will not be happy – so be it.
I am sympathetic to my tenants and willing to reduce rent even more if, god forbid, their income suffers due to coronavirus lockdown and they show me this.
We did not raise rent since tenants moved in ( in 4 years and in 3 years) and we already reduces rent till the end of the year for 5%.
Our tenants did not tell us that they lost jobs, I know that they are able to work remotely.
I hope that we are reasonable in our approach.
Chas373 | 5 years ago
If it were me I possibly would have accepted the 25% reduction while they were away, but more that likely would have first countered with a 10 or 15% reduction. BUT with the understanding that upon their coming back to stay, the rent reverts to the original amount. This of course is if you value them as tenants. The one thing to consider is none of us can be sure what the rental market will look like when the lock down ends. And more importantly when the moratorium on evictions is lifted in August. Many renters will be hurting financially and if they move out in large numbers, who is to say that there will be an equal influx of new renters to keep the market pricing up? I have already spoken with my tenants (those of whom I value and want to keep) and have said that I will look at market rents for like apartments at that time. And if the current pricing is more than what the then market is showing, I would then discuss a reduction with them. At that point it would become a tenant’s market. It will be foolish to try to keep a tenant locked into a rent for an apartment that they would be able to find elsewhere for less. They will most likely have a keen eye themselves on the market. Also making sour grapes now for them doesn’t bode well for giving them a sense of “home” and the feeling that you are a really great landlord vs a greedy one who is looking to squeeze every last bit you can out of them. I think it makes sense to keep the money coming in, in as steady a way as possible. After this mess ends the last thing I want to be dealing with is replacing tenants with new ones that are unproven while the market readjusts itself and returns to normal.
Rick | 5 years ago
As a small time landlord I am sympathetic to my tenants and the situation . Mortgage and the running expenses still have to be paid and I hope my tenants will still make rent . You ask, ” How other small landlords handle the situation? ” Answer, one month at a time.