Tale #1 – Tenant Adulting Horror Story
Young twentysomething family moves into one of my units. Then I get the call from my rental manager a week before the rent is due.
The young woman lost her job because she missed four days of work. She missed four days of work because she had to be home while our maintenance people took care of some problems in her unit. It’s all our fault and she’s holding back her rent for lost wages. Whhaaaatttt?
This is why I no longer manage my own rentals. I would have given her a lesson in adulthood right there. READ YOUR LEASE! You do NOT need to be present for a maintenance call. If you couldn’t get the time off work without consequence, you could have just gone to work! Yes, I realize some people are queezy about maintenance people in their home, and that is certainly your right. But that doesn’t mean we’re responsible for the consequences of you not going to work! You CHOSE to blow off your shift! That’s on YOU! Welcome to adulthood!
My rental manager said something similar to the tenant, probably with a lot less exasperation. But the tenant still didn’t like that answer. She did what any responsible adult would do. She called Mommy and Daddy.
Since Mommy and Daddy got nowhere with our rental manager, they decided to go over her head. They looked up the owner of the property, an LLC. Then they did some digging and found the owner of the LLC, my husband. Then they contacted him via Facebook messenger. Pretty innovative – gotta hand that to them! They didn’t get very far with Steve, either. So they decided to call the building code inspector.
Because obviously something must be wrong with the building. It can’t be their precious princess’ fault, after all! Now I know where the kid gets the idea that she’s responsible for nothing that happens in her life.
Better make room in the basement, because your baby’s coming home to live with you!
The building inspector wasn’t much help to them. He came out and saw the obvious situation – there were some maintenance issues in the unit that we were addressing. The tenant didn’t have the rent money and was looking for a way to make that our problem, not hers. It’s nothing the building inspector hasn’t seen before. She wasn’t the first tenant to try this trick. She won’t be the last.
Note to landlords: keep a written record of all maintenance calls, and dispatch them promptly. Be the adult in the room!
Tale #2 – When the Landlord has problems with adult responsibility
I have some friends who are renting a rather upscale, new construction unit. It’s so new they were among the first tenants to move into the complex. In fact, their unit wasn’t even completely finished – there were some closet doors and wood trim that hadn’t been installed. No big deal. They moved in with the understanding that would be taken care of later.
Then they had a problem with the drain in their bathtub. Something wasn’t sealed right, and the water was going right through the floor. The landlord told them not to use the tub for now, he would fix it soon.
Then the apartment above them had the same issues – their neighbor’s bathtub water was falling through their ceiling! Again a call to the landlord, who asked the upstairs neighbor also not to use her tub until further notice.
Only the upstairs neighbor continued to use the tub. Now my friends’ bathroom ceiling is falling in!
They’ve been calling and calling, always being told someone would be by the fix the problem. No one has come yet. And the closet doors and wood trim have never been addressed either.
Now, as a landlord I understand how hard it is to find reliable maintenance people. Even when you find them, they often don’t stay reliable for long (more problems with adulting!) We get a call from a tenant about a problem and dispatch a maintenance person. Unless the tenant tells us otherwise, or we happen to check up on it ourselves, we can only assume that the service we paid for was rendered. But this landlord had no excuse. He got the follow-up call from the tenant that something was not right. He got several calls, in fact.
Here is what I advised my friends to do: keep a log of all the calls made to the landlord about this problem. Make one more call and log that one, too. Then write a letter describing the issues that need to be addressed immediately and give the landlord five days to address them. Then send two copies of the letter to the place where you send your rent: one by first class mail, the other by certified letter.
Chances are the certified letter will get this landlord to do the right thing – either fix the damage himself or hire a responsible handyman who will actually show up to do the job. At the end of the day, it is that landlord’s adult responsibility to see that the issues are fixed.
If he ignores the letter like he ignores the phone calls, I’ve advised my friends to put their rent money into an escrow account on or before the due date. Under Pennsylvania law you cannot simply stop paying your rent because of unaddressed maintenance and repair issues! Here is a link to the state law on this subject: http://www.palawhelp.org/resource/deduct-repair-tenants-right-to-a-safe-and-dec?ref=TgYL2
Tenants: also note this deduct-for-repairs law only applies to major repairs that affect the habitability of your unit. The closet doors and the wood trim are not issues of habitability. Dirty bath water cascading through your ceiling, however, is an issue of habitability, as is the falling-in ceiling.
I hate landlords like this that give the rest of us a bad name.
There. I’ve said my piece about adult responsibility. A concept that applies to tenants and landlords alike!
When you run a business, you have to Adult, every day!
Adulting is hard! I have taxes to pull together for the several LLCs my husband has opened to run our one business. I’ve blogged about this before – for liability protection, it’s smart to put each rental property into its own LLC. I have to pull together all the tax information and organize it in such a way that my accountant knows what she’s looking at. Then she (and the associates in her firm) actually do the taxes.
I met with our accountant yesterday to go over our mercantile taxes. In Pennsylvania, we pay a portion of gross receipts for the very privilege of doing business. It’s actually called the Business Privilege Tax. It’s a very small percentage, but it sticks in my craw. They get to skim my gross rents, before any of my expenses. And I have a lot of expenses! Plus, if I charge a higher rent on one unit because the heat is included, I end up getting jacked on the Business Privilege Tax. It’s an added incentive to separate all utilities and make the tenants pay for all of them!
Anyway, I love my accountant. Her name is Marilyn Derolf, and she is the new owner of HMS-CPA in Forty Fort. She was telling me she bought out the other partners a few years ago, making HMS-CPA a woman-owned small business. Old timers may remember the firm as Hall, Mihalos & Straub.
Women business owners face some unique challenges in Northeastern Pennsylvania. The struggle is real – this area is behind the times in that regard. It makes us work harder and smarter. Marilyn is a top-notch accountant and tax planner, and I would recommend her to anyone. Especially a small business owner, she understands what we go through. And she has a sizable staff of capable CPAs – men and women - to handle the workload. https://hms-cpa.com/
I felt really good stepping out of her office yesterday. I’ve been a bit down about the fortunes of our business lately. 2015 is not going to be a year we owe a lot in taxes, put it that way! We flipped two houses in New Jersey that haven’t sold yet, it was a down year for rental income, and we’ve been relying heavily on our credit. I’ve been feeling like a loser, actually. But Marilyn assured me this is par for the course for anyone that owns a business. She goes through it. She handles tax returns from others who go through it every day. It’s nice to know it’s not just me.
Small business is the engine that runs the American economy. I’ve always believed that. If you’re a landlord, or a real estate entrepreneur, or both, you’re a small business owner. Be proud. And take pride.