Greetings Real Estate Investors!
Today we have another lesson that is ripped directly from our own Real Property Management Miami headlines. Or should I say rather deadlines…because this story is a cautionary one regarding the importance of a well drafted lease so that you as the landlord can be protected.
Since we manage hundreds of properties there is hardly a day that goes by without processing the end or beginning of a lease. And as important as the beginning of the lease is we cannot overstate the importance of the end of the lease. Specifically what are the terms that conclude the lease, including the rights of the tenant and the landlord to either cancel or extend the lease.
Too Good to Go
So one of the great things about using a professional property manager is that you keep your property running perfectly and so you have very happy tenants. This usually means that you can raise rent and do other things that you couldn’t do with unhappy tenants. But the other side of the coin is that the tenants love the situation so much that they don’t want to move to another property that is poorly managed. This happened recently when a lease was coming up for renewal and the tenants notified us well in advance of the 60 days they were required to notify of intent to renew. The problem is that the investor had also done very well on the property and was ready to sell and upgrade to a duplex. The investor also notified us of their intent to non-renew the lease and sell the property prior to the 60 days that were required by the lease.
Parting is Sweet Sorrow
We notified the tenants that unfortunately the property was going to be sold so they would have to find another place to live. They then spoke to make people and got some bad advice and became convinced that since they had notified us prior to the 60 days that it was their right to stay in the property. They even enlisted the broker of their real estate agent who owned the real estate company and thought he knew how leases worked since he had “been in the business for 30 years”. He even went so far as to threaten to report us to the DBPR which is the state agency the regulates Real Estate.
It’s All About the Paper
Since we understand the law and how leases work we calmly informed all of tenants’ supporters that unfortunately for them the lease stated that both parties must agree in writing to renew the lease prior to the 60 days. Since our client had not agreed to renew but in fact had specifically given notice that he would not renew the law was on the landlords side and the tenants would have to move. After many frustrated and sometimes rude emails from the tenants and broker (this is why you hire a property management company) they finally gave in to the truth that was there in black and white on the lease that all parties had signed.
A Happy Ending (For Our Side)
The tenants moved out on time and the landlord was able to sell his property at a big profit and we are now managing the new duplex he bought with the return from his sale. The moral of the story is that you must have solid lease documents that protect you in every circumstance and you must also have excellent representation that knows how the law works. If you don’t you might end up having some broker give you bad advice they have been running a crappy business for 30 years and still don’t know how leases work.
If you want true professionals to handle all of the problems and rude people that you may encounter when renting out your property then call us at 305-517-3900 and we will show you the light!
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