Purchase includes existing tenant whp would like to stay

[Wayne]

I just bought a house w/ 1 bdrm suite in the basement. I will be occupying the upper floor. The lower suite has been rented by same tenant for about 8 years (with no rent increases) and would like to stay. Tenant did pay a small damage dep initially, but is not currently on any type of lease or rental agreement. Previous owner and tenant had a verbal agreement which included the following:

Rent = $575 pm which includes cable, utilities, wireless internet, laundry, parking.

This is currently what I (as a landlord) will be faced with as of Jan 31st possession date:

- Equivalent rents in the area go for about $600-$625
- Tenant currently has 3 cats living in suite.
- Tenant unhooked smoke alarm.
- Smoker
- Overloaded wall electrical outlet with numerous cords/plugs (inspector sais fire hazzard)
- No tenant agrement or lease in place.

I would like to keep tenant, but in the meantime, I am looking to you for advice and/or suggestions on how to approach this situation.


Thanks,

Wayne

 

[OlegP]

QUOTE (Wayne @ Jan 4 2010, 01:31 PM) I just bought a house w/ 1 bdrm suite in the basement. I will be occupying the upper floor. The lower suite has been rented by same tenant for about 8 years (with no rent increases) and would like to stay. Tenant did pay a small damage dep initially, but is not currently on any type of lease or rental agreement. Previous owner and tenant had a verbal agreement which included the following:

Rent = $575 pm which includes cable, utilities, wireless internet, laundry, parking.

This is currently what I (as a landlord) will be faced with as of Jan 31st possession date:

- Equivalent rents in the area go for about $600-$625
- Tenant currently has 3 cats living in suite.
- Tenant unhooked smoke alarm.
- Smoker
- Overloaded wall electrical outlet with numerous cords/plugs (inspector sais fire hazzard)
- No tenant agrement or lease in place.

I would like to keep tenant, but in the meantime, I am looking to you for advice and/or suggestions on how to approach this situation.


Thanks,

Wayne

You absolutely need a Tenantcy Agreement in place, even if it reflects the status quo (i.e. month-by-month, current rent amount, and of course all of the resposibilities, rules of engagement so to say...)

If BC has rent controls, you can only increase rents once a year. Otherwise, you can bring it up to the market level.

Notify them in writing that they are presently violating safety and rules, and that you will be entering on a certain date to do the repairs. Paper trail has be kept in all situations.

 

[Wayne]

QUOTE (OlegP @ Jan 5 2010, 05:58 PM) You absolutely need a Tenantcy Agreement in place, even if it reflects the status quo (i.e. month-by-month, current rent amount, and of course all of the resposibilities, rules of engagement so to say...)

If BC has rent controls, you can only increase rents once a year. Otherwise, you can bring it up to the market level.

Notify them in writing that they are presently violating safety and rules, and that you will be entering on a certain date to do the repairs. Paper trail has be kept in all situations.

Thanks for all the advice folks.


Regards,

Wayne

 

[fumbrunner]

QUOTE (Wayne @ Jan 5 2010, 06:13 PM) Thanks for all the advice folks.


Regards,

Wayne

no need to double post.  you had a number of comments on your previous (duplicate) post.

 

[housedoc]

Congrats on your purchase. 1st?

I hope you have no problems with your tenant.
However, in addition to the negatives you have mentioned, you will have a tenant who may feel that you are encroaching on HIS space.
Will he stop smoking? Will he get a dog?
Will you screen him, or is he ok because he comes with the house?
How much do you care?
Overloaded outlet is probably due to inadequate wiring in the unit. Cost to update electrical?
Is the rent crucial to carry it? An extra 50 bucks a month going to make or break?
Is the unit legal?
Inheriting a bad tenant in a rental is one thing. Under your own roof is another.

 

[MikeDix]

If you ever want to replace him down the road, be aware that BC has very specific rules about inferred agreements, and the difference between month to month versus periodic lease. A month to month agreement is assumed to be in place, even if you don`t have a physical one in place. Month to month gives your tenant the right of occupancy and you can only evict him if he is in violation of a material term (defined by the Residential Tenancy Act). My advice, see if he will sign a fixed term agreement, with the option to renew if both parties agree one month prior to the end date. Note: Even though you have a fixed term agreement, you HAVE to have the following term specified (or similar wording) in the agreement: "The tenant agrees to vacate the property on "[END DATE]". Believe it or not, I lost a case once because I did not have this specified (even though it was a fixed term lease). The RTA changes from time to time and it is important that you keep tabs on these type of things...a sophisticated tenant can exploit this type of oversight. BTW, also be aware that once a fixed term agreement is allowed to lapse, the tenancy agreement automatically becomes month to month... (remember this is BC and may not apply to the rest of Canada).