Confessions of a California Landlord

30 thoughts on “Confessions of a California Landlord”

  1. Hey Johnny,

    I saw in a video you mused that you might put in an outdoor shower at this property. Did that ever come to fruition? If so, how’d you integrate it into your current set up? If not, why not?

    Love your work!

  2. Curious about the point on charging well below the market rent .. what is the thinking behind this? Surely even a small or undeveloped property will still have its own market value, but what is the rationale for charging below the market value? Is this to attempt to attract a wider choice of tenant? Or is there another reason for this?

    Having just written that sparked a thought. The property that I bought and lived in and now rent out after circumstances changed (in Northern Ireland) was one that I never intended to rent out when I bought it. However it is in a popular location close to the airport and a 7 minute train to the city centre, good schools, shops, blah blah blah. At the time I engaged an agent to put the To Let board up and advertise the property for me. I got a bit greedy for money and they suggested a range, even which the top end of the range seemed reasonable as I knew of lesser properties in the area rented for that. I went with the top price and to my horror had only a couple of ‘poor quality’ applicants (multiple people clubbing together with low income unverifiable jobs). Reducing the asking rent by only 20GBP (25USD) per month gave me an influx of applicants which required an open day (I think 16 viewers) and an excellent choice of people. Point I’m making is demand can be highly price sensitive.

    1. First, I have no mortgage on this property so I don’t have debt to service each month. That gives me the freedom to not press for every extra dollar. Second, I liked this family very much and having them occupy the property gave me peace of mind. They left the place in better condition than they found it and got on beautifully with the neighbors. That’s worth a great deal to me. Third, the house was never meant to be a profit-making concern. My goal from the start was to have a Plan B option in case of unforeseen difficulties. Call it a form of insurance rather than an investment if that makes sense. Not everything in life is about money.

  3. Attorney here (do not practice in California). Worked for a state civil rights department during law school. You want to make sure that you, as a landlord, land lady, and/or lessor, do not illegally discriminate. It’s a civil rights issue. In California, there’s a Department of Fair Employment and Housing that you might use as a starting point. The buzz words for internet searches would be “discrimination” and “civil rights.” By “discrimination,” I mean “illegal discrimination”: e.g., discrimination based on race, sex, etc.

  4. I would have had a hard time turning down the emotional support pig folks. Sometimes to me the potential tales are worth as much as money, but that’s also why I am not a landlord.

  5. I don’t suppose “what’s your gardening background” is a legit question… is it?
    Can you ask about hobbies or outside interests?
    Or maybe my question ought to be – where might one go to find out what CAN be asked of a prospective tenant?

    I find myself in the strange position of embarking on the “we’re gonna rent a house to somebody” journey and I’m pretty unprepared. Maybe it’ll be best to wait a few months though…
    Wish I knew a greater number of people who knew people…

    1. I like to walk people around the property, point out the kinds of things I’ve been doing, and see what their response is. The elegant lady had zero interest in the garden – other than to ask when the gardener would come to cut the grass. That told me what I needed to know. The people who recently moved in have already started gardening and I’ve provided the heirloom seeds and a fresh bulk delivery of organic compost for the veggie beds along with all the existing tools in the shed. That’s why I make lunch and dinner and get to know people before I sign a lease. I actually went to a flea market with them and they got to know me too. I’m weird so if I turn people off it’s best for everyone to know that ahead of time.

      1. Ah, so you actually invite prospective tenants to a meal (or two) or an outing – even if they’re not introduced to you by your neighbor but just found you via an ad? That’s a smart move. Can use what you learn in such a meeting to decline a tenant (is “we didn’t jive” a valid reason?)?

        The place we’ve got doesn’t have an existing garden but it has room for one – and I’m a plant person/gardener-type so I favor relationships with people who have an interest in tending/nurturing plants and place as well. It’s an odd time to be looking for tenants, though – just read an article about 1/3 of CA renters not having paid rent in the first week of this month…

        Thanks for sharing your experience. I’m always appreciative of your posts.

        1. No. No. No. You can’t reject a prospective tenant just because, “you don’t jive.” Bad. And wrong. Bad and wrong together. Illegal bad and wrong.

          These were friends of the neighbors. I invited them for lunch. Casual. This was before I even placed an ad for the rental. I was just tinkering with the place. They had heard the property was vacant. I had heard they might be looking for a place to rent. I grilled some lamb chops and made a salad. We were just getting to know each other. Nothing to do with renting per se. Then we met again at the weekend flea market. They were able to gauge my level of crazy landlordness. I was taking their temperature to see if they were stable and solvent. Nothing to do with anything. See?

          1. I’m an idiot, obviously, and a completely unsubtle one at that. Oh boy this is gonna be quite the learning curve.

              1. Soft search vs. a “for rent” sign. It works because Johnny knows and talks to the neighbors.

                I’ve been slowly rehabbing a 1959 ranch house. I’ve chatted with the neighbors on each side and across the street. Just this week I told one that it’s getting close to being put on the market and they should tell any friends or colleagues they want as neighbors.

  6. I’m a landlord in the Sacramento area. 1960s era garden apartment. It’s a perfectly fine and safe neighborhood, but given the ample supply in the market, it attracts solely low income tenants.

    Other than one eviction over 7 years, I don’t have any horror stories. Most people are decent. Low income tenants tend to have multiple jobs, zero savings and bad credit. So it’s a matter of picking the lesser evil and hoping they can hang on for the duration of the lease.

    I love my current tenants, but confession… they’re undocumented. Of course, I was wary about renting to them, but when I researched the matter I learned that not only it is legal to rent to them, but it is illegal to even ask them their status in the state of CA.

    The only catch is that you have to treat all applicants the same – in terms of application fees and what not – or you open yourself to a potential discrimination suit. The only other applicant that weekend – a stripper – brought a bag full of receipts from her club as proof of income. However, she backed out so we rented it to the family.

    I have my own thoughts about immigration reform, especially given my direct experience. But they’ve been great tenants. I’m not a slumlord and they do demand and get repairs, some which have been costly. I do worry that, as America goes into this isolationist phase, the future landscape won’t be so kind to “Dreamers.”

  7. Care to share the cabinet supplier you went with. I’m trying to make a similar IKEA vs. Quality judgement for a place I am remodeling.

      1. If you are in California, and have the time or travel to Los Angeles periodically, I highly recommend Greencastle Cabinetry in South El Monte. Cabinets are plywood. I used them in apartments and rental houses up until 2015 when I moved to Cincinnati. I also made a special trip from Cincinnati to purchase 15 kitchens for an apartment complex that I own in Cincy. (I also bought cabinets for my personal residence and lugged them back to Cincinnati in my box truck and rented trailer). Prices are excellent. Cincinnati prices for cabinets (and most materials not sourced at the big boxes) is insane.

      2. How much did those cabinets set you back? I’ve got some MDF ones I’m thinking about putting new doors and a new countertop on. Dad thinks I should get all new cabinets. My wife doesn’t like the cost of new ones. I think it’s better to do it right the first time.

  8. Ah yes, being a small-scale landlord. Everyone thinks it’s all fun playing Snidely Whiplash, exploiting your tenants and laughing menacingly while arching your eyebrows and twirling your moustache. It’s actually a lot of work and more than a bit of risk. I’ve long owned a small apartment building with a friend who has the job of managing it, but more than a few weekends have gone into renovating a unit after a tenant has moved out; 15 or 20 years ago it was rather fun, but that’s worn a bit. I had hoped to sell this year but that’s probably on hold.

  9. I had a serious renter’s horror in a property we owned with others but had no control over management. Tweaker tenant trashed it. Yikes.

    That got sold. We bought a new one on our own. Rented in two days via Craigslist to a single mom with kids. That was ten years ago. She’s still there. Pays on time, and a few years back became a nurse, and can walk to the hospital, so a bulletproof job.

    We got lucky with her….

  10. My daughter and husband just leased our old home for the year. She got the family rate, with none of the due diligence described above. The next tenants won’t be so lucky. Our finances won’t allow for a prolonged tenant search, so I may have to accept two out of the three questions!

  11. I feel torn in these situations. As a landlord you’re totally doing the right thing, but I know there will always be those people who can’t pass your 3-question test but are honorable and would do everything possible to do right by the landlord.

      1. It’s always easier to lie to oneself! After all, everyone likes to think that we’d do good every time we can–and when we find that we can’t, there’s always a good reason for it…or so we think.

  12. “It’s best to rent to the very first applicant who qualifies so there’s no illegal cherry picking.”

    I just do a spreadsheet for the applicants and include monthly income , job tenure, and the existence & quality of previous landlord reference(s). That would hold up in court easily. I pay for credit reports for the top candidate. The ~$50 per report is worth it.

  13. I’ve heard horror stories concerning being a landlord. Glad you are discerning enough to find good renters! I would have been lost once the pug arrived.

    1. I don’t think I could handle it. The laws and hoops a landlord has to jump through in CA to rent his OWN property are absurd. They seem to be designed to make it easy for tenants to sue and for only big rental corporations to afford the legal compliance and defense.

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