At first, renting out your Baltimore County property to your friends and family might sound like a great idea.
You know more about them than your other tenants, and you know that they’re good people. You think that if a problem were to arise, you’d be able to handle it swiftly and without hassle because they’d be more likely to cooperate with you than a stranger would.
In truth, renting to people you share a close relationship with can create a potentially delicate situation. Mixing personal relationships and business rarely ends well, so you should always carefully consider your decision to rent to friends and family.
You never know what might go wrong. So, keep reading to find out the six reasons you shouldn’t rent to your friends and family.
Why You Shouldn’t Rent Your Baltimore County Property to Friends and Family
1. They Might Take Advantage of You
If you want to help out people you know and love, renting to them isn’t a good way to do it. If they’re struggling, you may not be able to say “no” when necessary.
Even good people can take advantage of the situation. They might be unable to pay on time or may be unable to afford the rent altogether. They might damage the property, ignore local Baltimore County ordinances, and disregard the terms of your lease agreement.
Friends and family may believe you’ll forgive these mistakes because of your personal relationship. They might think you’ll be lenient, so they won’t have to give much thought to preserving the business relationship.
Your loved ones may do this without realizing it – don’t let it happen or you’ll end up resenting them.
2. They Might Be Too Nice
This one may seem surprising, but it can be a major issue.
Because if your Baltimore County properties need some work, your friends and family may be reluctant to let you know.
It’s not just because they might have caused the damage. You could have numerous pre-existing problems that need attention, but you might never hear about them because they worry you’ll be upset with them or blame them for the problems.
People you share a close relationship with may not recognize the pressing need to fix these issues. They might be content living in your property, and subconsciously suppress the knowledge of problems in their rental unit.
If you must rent to friends and family, be sure they know to alert you to all problems with your rental properties – the same as any other tenant should.
3. The Power Dynamic
You too could be at fault in a situation where you’re a landlord to your loved ones.
Landlords are inherently in a position of power over their tenants. They own the properties their tenants pay to live in on temporary lease agreements, and a landlord can alter or terminate those agreements at any time—and for a long list of reasons.
You have control over you’re a major aspect of your tenants’ lives. And if they’re your friends and family, they may grow to resent you for that power. They may feel they can’t be as comfortable with you as they once were for fear you might wield that power in a way that negatively affects them.
It is difficult to avoid conflict in a situation with such a clear power imbalance, especially when issues arise. To avoid feeling like you’ve exploited your position of power don’t rent to friends and family.
4. Unnecessary Involvement in Their Personal Lives
One reason a landlord might rent to friends and family is because they feel obligated to.
When loved ones live on your property, it’s practically impossible to avoid becoming more invested in their lives – especially if you have to demand a rent check from them every month.
Soon you could find yourself entangled in their personal lives instead of focusing on your own. You might forget to focus on your own goals and responsibilities if they’re issues are dominating your time.
And when you need to pull out of your involvement in their lives to protect your business interests, you might do considerable damage to your personal relationship with them.
5. The Relationship Might Sour
Financial situations almost always put a strain on close relationships.
Imagine having to ask your friends and family for a late rent payment. You might have to contact them every month to demand they pay on time. You could end up feeling guilty, but unable to be more lenient because you have to make your mortgage payment on your Baltimore County property.
Additionally, your friends and family might feel you’re playing favorites, especially if you’re renting to more than one person you share a close relationship with. Or, your other tenants may accuse you of favoritism because you are more lenient with your loved ones.
A Baltimore County property manager must require all his or her tenants to follow the exact same set of rules as stipulated by the lease agreement. Any form of favoritism is illegal and can cause strain on your relationships with your tenants.
6. Eviction May Be Necessary
As a landlord, you aren’t running a charity. Your goal is to make a profit from your rental property – not to provide family and friends a convenient and inexpensive place to live.
If you do end up renting to your friends and relatives, understand that there might come a time when you must evict them. Just because you’re close to them doesn’t mean they won’t violate the rental agreement or stop paying their rent altogether.
Evicting someone could permanently damage these relationships. Would you be comfortable with kicking your cousin, your college roommate, your uncle, your sister, or your best friend out of their apartment? They might never fully forgive you or understand why you had to do it.
That’s why you should strive to always place tenants in your properties who allow you to operate in a professional, businesslike manner. When issues arise, you can handle them in ways that don’t waste time and money.
None of this is to say you have to be an overly tough landlord. You can be friendly with your tenants as long as they recognize that the relationship is built on a foundation of professionalism.
If you value the relationship you have with a friend or family member, don’t rent to them. It’s a conflict of interest you should avoid, period.