Flipping Rich

Property owners and landlords have plenty of issues to deal with on a monthly basis, believe it or not. I was having a conversation last week with someone saying how surprising it is in the amount of time per month I spend on collecting rent. Sure, theoretically rent is paid on the 1st, and if not by the 5th, a late fee applies. However I would say that 5% of tenants have some type of issue with paying the rent on time, it comes with the territory I guess.

The common complaint on owning rental property is the three T’s, toilets, tenants and taxes. It is so true. One thing that is not talked about is death and tenants.

I want to start out saying that I mean no disrespect to families that deal with this, or that are currently sorting this out. This is meant only as a perspective of a rental property owner and one of the not so glamorous aspects of having property, the dead tenant. I will add that I have also lost a parent and the amount of time required to sort out their personal things and making arrangements etc, was cumbersome.

I have also touched on this issue in the past here

Recently I had to deal with this more hands on. There were a number of landlord/tenant issues raised in the process, so I thought it worth sharing with anyone considering investing in rental property.

In a property that I recently acquired I had a tenant that as I understood it, always paid on time. Having not received a rent check by the 5th day of the month I was concerned about why, at the same time I had several other non paying tenants, which is common enough. My practice is to put a note on the door of anyone that has not yet paid, which I did. The majority of tenants contact me within a day or pay. If the note does not move, it usually means something else.

As landlords we are not able to enter apartments on a whim. There needs to be notice, or a probably cause. Not having a rent check is not enough. The notes I put on doors almost always disappear. If they dont, it means they are usually out of town, in the hospital, or moved out. As owners we have to play by the legal rules which means we cannot just enter.

As it turns out, I had already posted notice to the entire building about doing a full building inspection, going unit to unit, on the 12th. The intention of the inspection was to look for water problems, running toilets, and smoke detectors in each unit.

I did not place too much concern in the units that had not yet removed their late notice as I fully intended and gave proper notice on entering their unit on the 12th. That is, until one unit that had not paid seemed to have a strong odor.

To complicate the issue there was no master key for the building, and no spare key kept be the previous owner. As an owner I had to make a judgement call now with the odor, which was not at emergency level, and the lack of having easy access to the unit.

I did call a locksmith who tried to pick the lock. While he was there I called the police to let them know there might be a problem. The police responded with “let us know if you find a body”.

Because the locksmith could not pick the lock, we had to drill out the core of the lock. Luckily, in some ways, the door was chained from the inside, which really told us someone was in there. I recalled the police who upon arrival kicked in the door. There was a body.

Again for illustration purposes and owner perspective this is something that might come up. The things I am left with is an unpaid for rental unit. A large locksmith bill. Nearly a full day of my personal time between locksmith, police and medical examiner. And the cost of getting a unit back in order for as a new rental. It was also strenuous mentally.

The legal issues that are raised is also something to consider. At what point is it okay to enter a unit without notice? In this instance it was the odor that gave probable cause. I would argue that it would be nice to have at least slightly more control and the legal right to open a door just to see if someone moved out when no one was looking, which has also happened to me.

I will say that this is one of those reminders that it is good to be alive. I do not recall any day recently that I was SO happy to pick up my kids from school. I spent a great evening with them going ice skating/hockey, followed be an hour of Halo 3.