Dealing With Tricky Tenants

There are some scenarios that can challenge even the most experienced landlord or agent.  I’m not thinking so much about legal matters, more those grey awkward management issues that we may have a clear policy or procedure for, but in the end it’s the way we manage the situation that wins the day.

I was recently asked to talk about dealing with tricky tenants for Greenwich Business club and I put together four classic scenarios: moving extra people in, dealing with noise, untidy tenants and failure to report maintenance issues.  I think the first matter to consider is how to create the right framework to minimize the possibility of problems.

An incredible number of landlords take tenants without carrying out referencing.  Most prospective, good tenants will be happy to submit themselves to a referencing process and this in its own right is a good indication that the relationship will be positive.  A full tenant reference can cost less than £25 and will verify identity, previous housing and employment circumstances and creditworthiness.  Why would you hand over a valuable asset to somebody you’ve just met without this kind of research?  I recommend you get buildings insurance designed for landlords which includes cover for malicious damage by the tenant or their guests.  Using a proper tenancy agreement and an inventory including photos are of course vital because they formally establish the rules of the let and the property’s condition when the tenant moves in.  Landlord associations or letting agents can help you with all of these services or you can prepare an inventory yourself.

I recommend using 12 month contracts with a 6 month break clause.  If you and the tenant don’t get on,  you can activate the break clause and end the agreement after six months.  The contract should also include clauses on anti social behaviour, pets and smoking to help you deal should these three issues should they occur.  My properties are non smoking and I make it clear than deterioration caused by smoking must be paid for by the tenant.

If you’re a self managing landlord and you have used an agent to find your tenant, they may have had a poor experience, so check with the tenant how this went and make them aware that you intend to provide a good service.  An induction meeting is the best place to do this.  I meet the tenant at the property for check in, run through a list of issues and walk round the property with them to see if they have any questions.  I also tell them that I will carry out periodic inspections to check that the property is being used in accordance with the tenancy agreement.  Having a positive, helpful, honest attitude with the tenant all helps to create the right tone and will encourage them to behave in a “tenant like manner.”  In law this actually refers to the expectation that tenants will not cause or allow guests to cause damage and that they will carry out everyday maintenance such as unblocking a sink, changing bulbs or putting a draught excluder on a window.  The rule of thumb is “if the house were mine, would I call somebody out to do this?” I think it’s useful to remind ourselves of tenant’s responsibilities and that landlords should not be providing a concierge service.

My first scenario was tenants moving extra people in.  The first challenge is finding out of course as the tenant may conceal evidence when you carry out an inspection.  What are the best ways to raise the issue with the tenant? You could ask a direct question.  I was carrying out a repair in the bathroom of a house and noticed that there was a mattress and some belongings in the box room – which I don’t consider to be a bathroom – next door.   I asked the tenant and said I couldn’t help noticing as the door was ajar.  It’s important to ask in a curious not in an accusatory way:  “I noticed….. and I was wondering….”  It is sometimes helpful to say how you feel: “I am disappointed you didn’t ask me first” and remember to refer to the contract, which should state the maximum agreed number of occupants.  Now you know, negotiate an arrangement.  I had a scenario where one of four sharers asked if her partner could move in, because when the contract ended in three months time they wanted to find a place together.  I thanked her for asking me and did give my permission.  I said that sometimes the rent would be increased to take account of greater wear and tear but as it was a temporary arrangement I was happy to waive this.  It was nice to feel I was helping them set up on their own and it created a lot of goodwill.  The remaining sharers renewed and three years later are still there.  Goodwill and a positive relationship can be more valuable than a bit of extra rent.

If the three bed house that you let to a family of three now houses six people, you will need to decide whether to end or continue the contract.  Having a 12 month contract with a six month break helps.  At the month 3 inspection, you can query the situation and request that the additional people move out.  If they haven’t by month 4 you can serve a section 21 notice to end the tenancy.  Other options are to increase the rent and allow them all to stay or let the contract run on to 12 months and say that you do not wish to renew.  I would suggest you use a section 8 or 21 notice as a last resort – for example where there are arrears – as you may get an antagonistic response, more on that later.

Noise is, in effect anti social behaviour, and as local authority licensing spreads, you need to stay on top of it because failure to manage it could jeopardise your ability to get or keep a license.  I always get to know my neighbours and give them my contact details whenever I buy a property, so they know how to reach me if they’re having problems with my tenants or vice versa – I have had problems in both directions.  I would suggest carrying out an informal investigation.  Ask for specific details about the complaint and then put this to your tenant.  Don’t accuse them, just ask them to respond.  You will need to decide whether to conduct this by phone or face to face.  My initial instinct would be by phone because calling a face to face meeting suggests a high level of seriousness and you might want to save that if the situation continues or escalates.  Remember that face to face is nearly always best with tenants with limited English in any case.  If you have sharers, often they will not want to grass on one another so that creates a tricky situation, you may have to read between the lines.  Ultimately you will need to come to a conclusion, agree ground rules and state the consequences of infringement.  I would recommend no loud music after 11pm, maybe midnight on Fridays and Saturdays.  Tell them you may be unable to renew the tenancy or even end it early if the ground rules are breached, but this is a last resort.   Also the neighbours may complain to the council who could in turn take court action.  If possible, encourage tenants to speak to the neighbours and apologise, as this kind of human contact helps to create empathy and change behavior.  You will need to decide whether to end or continue the contract, where possible allow the contract to run to its end.  If you instigate section 8 or 21 proceedings to end the agreement early, expect to manage angry responses from the tenant, which could present itself in more noise.  After all, the tenants will then have nothing to lose.

Do tenants have the right to live untidily?  Well actually to a certain extent they do.  Hoarding rubbish would be unacceptable – as the law requires them to deal with waste.  But chaotic bedrooms, kitchens and living rooms as many of you will know are quite common.  Sometimes people argue that untidiness comes with a certain type of tenant.  My tidiest houses at the moment are rented to families with full time mums, my least tidy ones to busy professionals on big salaries.  In the past I’ve had two houses each with three women sharing, one is very untidy, the other pristine.  The key question for us is whether the day to day management of the home is causing more wear and tear or indeed damage.  Levels of cleanliness are more a concern for me, as dirt gets ground in, baths and sinks get covered in limescale and ovens get clogged up with baked on grease.  I assess cleanliness as part of the inspection process, graded from 1 to 10 and warn that low levels of cleanliness could increase the cost of the exit clean and create excess wear and tear.  I have attempted to get cleaners involved mid tenancy before, sometimes by suggesting to busy professionals that they might want to get a cleaner and giving them a phone number of cleaners I use.  My biggest dilemmas have been where a tenant is untidy and does minimal housework but is otherwise great and wants to renew.  Sometimes I have offered a complimentary spring clean – this can work because the tenant realises how much nicer the house is when it is clean and is then prompted to keep the cleaner and stay longer.  They may have to declutter in preparation for the cleaner and It also gets your property back up to a certain standard, which for £100 or so is probably worth it.  Again you will need to decide whether to end or continue the contract.   It’s a brave landlord who tells a tenant that the contract is not being renewed because they are too dirty or untidy, so using other non confrontational reasons like wanting to carry out works would be better.  But if you want to you can tell them that you expect certain standards of cleanliness, give them one month to bring the property up to standard and then decide whether to renew or even end the contract with the six month break clause or at 12 months.  Consider how they might react and how cooperative this will be.  It may be more appropriate in a student context where landlords are sometimes seen as being in a more loco parentis role.  If this is the case, get the right balance between being firm and supportive and remember sometimes young people just want to rebel again parental figures, try not to slip into that dynamic.

My final scenario is tenants’ failure to report repairs.  You need to get to the root of this: maybe they don’t want to bother you, or don’t like feeling they have to depend on you. They might have reported it in their own way but you didn’t hear, or you don’t realise what’s important to them.  They may have had bad experiences with other landlords or indeed you.  I had a tenant report a hole under the fence in the garden caused by a fox and I suggested they fill it in with earth or bricks.  They seemed to struggle with this idea and I noticed that they weren’t watering or mowing the lawn.  One day I was dealing with another repair and the tenant’s wife, who had rarely spoken to me in the past, angrily told me that they couldn’t take their toddler into the garden for fear of the fox coming under the fence.  Now foxes can of course climb over fences too, so the concern was a little irritational but nevertheless important to her, so I had my builder cover up the hole.  They are now on their third annual renewal.  The other classic scenario is where a tenant fails to report a stain in the ceiling until it’s been there for six weeks and by then has got considerably bigger, potentially causing more damage.  Periodic inspections can help avoid this, but you also need to encourage tenants to report maintenance problems because you want the property to stay well maintained and for them to be happy.  I’ve had repair issues get lost in translation too where language is a barrier and have found google translate helpful for emailing in other languages.  It can be a bit crude but if you send an English version too the tenant can usually get a clear picture of what you’re trying to say.  Face to face is best too so that each of you can point things out and you can read body language and see how they feel.  Good landlords are community workers too.

Finally, how do you end a tenancy tactfully, where there’s a danger the tenant might be aggrieved and leave badly?  Well it’s helpful if the term of the contract is fixed and an end is on the horizon.  If it’s periodic, then you have to make a point of ending the contract.  With a fixed contract, 3-6 months before the end, ask the tenants about their plans and tell them a little about yours.  It may be that they plan to leave anyway and you can signal that you might have other plans.  Allow a few weeks for this to sink in and then confirm that you do want to end the tenancy, but try to give a non confrontational reason.  So it might be you want to move in a family member who is coming from abroad or you plan to carry out works.  I would also issue what I call a low key section 21 notice confirming this.  Mention in a friendly letter that the law requires you to issue this notice and it’s just confirming what you’ve agreed.  So no mega solicitor’s letters or anything like that.  You should be supportive around their move, for example, suggesting other properties, agents, websites, noticeboards etc.  Stay in contact, every other week, check how their search is going, but don’t put pressure on or harass them.

Most of what I’ve discussed relies on an effective style of communication.  You will be a more successful landlord or property manager if you can build rapport and get a feel for what’s going on.  Try to facilitate understanding by asking open questions, this is a great skill to develop and is harder than it at first seems.  Your approach should be one of evidence gathering.  I had a tenant whose rent payment was erratic, who said he ran his own business, but was always in his pyjamas mid morning whenever I visited.  So I was chatting with him one morning about his work and whether he employed staff.  He said “two or three” and it just made me more suspicious, I thought well he must know how many people he employs.  He pays rent on time now, so I’m a bit more relaxed but still a little unnerved and will continue to try and evidence gather.

Sometimes it’s important to give a clear instruction: please stop fiddling with the pressure on the boiler because it causes repeated malfunction.  Please don’t remove the smoke alarms, if they go off, press the button in the centre and they will stop.  Remember to serve notices as a last resort and you can always serve a section 21 notice in a low key way just confirming what has been agreed, rather than sending it very formally out of the blue.  Most importantly you need to manage your own feelings.  When tenants make you angry, you risk the danger of behaving aggressively.  Stay focused on the outcome you are looking for and aim to behave assertively instead.  Use good customer service skills.  Some maxims to help you on your way:

• Listen and observe
• Asking questions can often be better than making statements
• Don’t jump to conclusions
• Avoid ultimatums – only as a last resort
• Remember the cost of a tenant changeover
• Investing money could get you a better outcome