Update:

So far all three tenants have paid some portion of the rent. Two of the tenants have found new jobs (one tenant has two people in the family that have found new jobs). Evidence that even in this downturn some companies are expanding employment.

All three leases come up this summer. The tenant that manage to pay half the rent, we have offered to forgive a fourth of the rent if they can come up with another fourth. Regardless, we have also told them we will not increase the rent for next year and we will effectively spread what they can’t pay now over the next year or so. We do not plan to increase the rent on the other tenants either (normally we raise rent around 2–3% to cover rising HOA, property taxes, and insurance costs, but we are refinancing the units and with the lower interest rate we had hope to earn a bit more… instead it will go to defray the other costs that are going up).

One of the other two tenants, the one that has come up with the least amount of rent informed us that two people have gotten new jobs and so believes she will be able to pay the rent next month and once things settle out we will work on a strategy to collect some of the missing rent for April and forgive some.

The third tenant has shown good faith by making a substantial rent payment but for them the future is less clear and so we continue to work with them. Thanks to the efforts of all three tenants, we will need to dig into our two month capital fund by only a “half month” to cover costs not covered by their partial rent payments.

My point is to encourage all landlords and all tenants to work with one another. We see our relationship with our tenants as something we value and hopefully they feel the same. When landlord and tenant become adversaries, then it makes little sense to continue the relationship. It has to work for both parties. I do encourage landlords to be flexible, it costs money to lose a tenant and it costs a tenant money to move…