The older I get, the extra I dislike being a landlord. There’s an excessive amount of potential for disappointment, misunderstanding, or outright disagreeable moments. If you’re coping with folks and one in all your most beneficial property, the margin for frustration is excessive.
If you wish to be a profitable landlord—and never get run over—that you must set expectations clearly and implement them. In any other case, you’ll always really feel such as you’re letting somebody down or, worse, being taken benefit of.
This put up is a part of a sequence chronicling my journey as a landlord since 2005. My purpose is to present readers a clearer image of what’s actually concerned when you’re contemplating turning into one your self. This newest expertise additionally underscores the worth of hiring a property supervisor: somebody emotionally faraway from the method who can deal with your property purely as a enterprise asset.
San Francisco’s Scorching Rental Market
After 20 years of being a landlord, I’ve skilled all of the cycles. And proper now, the San Francisco rental market is powerful. With house costs close to all-time highs, mortgage charges nonetheless elevated, and the continued AI growth creating extra jobs, demand for leases appears to be rising.
Earlier this yr, my tenants of 5 years gave discover. That meant I had an opportunity to check the waters once more and re-rent my home. This time, the entire home to optimize our passive revenue, not simply the upstairs whereas conserving the downstairs empty. I listed it on Craigslist on a Tuesday and was instantly bombarded with curiosity.
By Saturday, I hosted two non-public showings for wonderful potential tenants. Each teams wished the place on the spot. One spouse was so excited she actually shouted: “We’ll take it! I need to transfer in proper now!” when she was leaving.
These weren’t flaky candidates both. They have been organized, enthusiastic, had nice jobs, and wonderful credit score. It was tough to decide on between them, so I requested every to submit their greatest supply. Inside 10 days, I had chosen the tenants, collected the deposit, and obtained the primary month’s hire.
The whole lot was shifting easily. Or so I believed.
Getting ready the Home for New Tenants
As a result of my spouse and I have been genuinely enthusiastic about this household, we went the additional mile to arrange the house. Over two weeks, we painted partitions and trim, patched and sanded uneven spots, scrubbed all the things high to backside, and tackled an enormous quantity of yard work. It felt extra like we have been prepping the home on the market than for hire.
Our earlier upstairs tenants had been stable, however they uncared for the yard. So my youngsters and I rolled up our sleeves and started working reseeding, trimming bushes, pulling weeds, and watering all the things again to life. Doing property upkeep alongside my youngsters is one thing I plan to maintain up. It builds their work ethic, provides them hands-on data, and helps them respect the worth of caring for what you personal. Working with them additionally makes me extra obsessed with addressing points.
On high of that, as a result of the possible tenants wished to maneuver in as quickly as doable, I needed to work out an earlier exit with the present upstairs tenants. That meant negotiating a prorated hire, agreeing on a snug move-out date, and ensuring they returned the unit in its unique situation. Not simple dealing with each side! Ultimately, all of it got here collectively. I bought the brand new household in eight days forward of schedule. By move-in day, the home seemed contemporary, clear, and able to be loved.
There’s a singular satisfaction in handing over a property in pristine situation. It units the tone for the connection immediately. You hope the tenants will see the satisfaction of possession and reciprocate by caring for the place. And as a landlord, it’s additionally a psychological reset. You’re feeling good realizing the property is in nice form earlier than handing over the keys as soon as extra.
The Transfer-In Demeanor Shift
On move-in day, the husband arrived early for our walkthrough. Calm, well mannered, and well-prepared, he had scheduled out the day:
- Walkthrough with me at 10 a.m.
- Buddy arriving at 11 to assist unload a van of extra delicate objects the tenant introduced.
- Major movers coming at 11:30 with a big truck.
The whole lot about him was orderly and respectful.
The spouse confirmed up later, round 11:15, clearly burdened from the packing and logistics at their previous place. The enjoyment she’d proven when she shouted, “I need to transfer in proper now!” was nowhere to be discovered.
Once I greeted her with a smile and a “good day,” she barely seemed up. No huge deal, I advised myself—it is a enterprise transaction, not a friendship. Shifting is worrying and rather a lot should have been on her thoughts.
I wrapped up the walkthrough, defined all of the nuances and upkeep tips on the home, handed over the keys, and wished them the very best.
The Shock Request
Per week later, I occurred to be driving by and noticed them exterior working within the yard. This was encouraging. I pulled over to say “good day,” and shortly seize a sizzling tub stool and a few chlorine bottles I’d left in out of doors storage.
The husband was pleasant, asking how I used to be doing. However the spouse instantly hit me with:
“Hey, I’ve bought a query for you. Are you able to get some mulch and also you pay for it? There are some naked spots right here and particularly within the again.”
No “hello.” No “thanks for the clear yard.” No “the home is nice.” Only a request.
Her tone caught me off guard. I anticipated some acknowledgment of the work we’d already achieved. Or not less than how she was having fun with the place. As a substitute, I felt like an worker being given a directive, one thing I’m not accustomed to after retiring in 2012. All these hours my youngsters and I had spent reseeding, trimming, and watering? Apparently meaningless or not adequate to their requirements.
I muttered a noncommittal, “Possibly,” and left with a “goodbye” for good measure. I wanted time to consider her request after the lease was signed.
Setting Clear Expectations
I satisfaction myself on offering a terrific product for the hire folks pay. That’s why I used to be a bit of shocked by her request, and in addition why hiring a property supervisor helps with lowering emotional attachment.
My lease—which I’ve been refining since 2005—is a number of pages lengthy and really clear. Nowhere does it say the owner should present mulch. Actually, it explicitly states tenants are liable for sustaining the yard and vegetation.
Throughout the non-public exhibiting, they by no means talked about mulch. Throughout lease evaluation and edits, mulch by no means got here up. Solely after signing did this “expectation” floor. Between signing the lease and shifting in, the mulch didn’t instantly disappear and this quick time frame.
That is precisely why setting clear expectations is so vital. If one thing isn’t within the lease, it shouldn’t instantly change into a requirement.
The Slippery Slope Of Giving In
Right here’s the hazard: when you begin giving in to further requests, expectations balloon.
For those who purchase and unfold mulch, what’s subsequent—a Toto Washlet and new lighting fixtures at your expense? The listing of desires could be countless. As an example, my new tenants additionally requested me to cowl the price of customized paint they utilized in a downstairs workplace and bed room. I declined. The present paint was completely high quality. I had simply repainted a type of rooms myself. Aesthetic upgrades fall squarely into the class of tenant bills.
Tenants are free to ask, however landlords want to guard themselves and are free to additionally say no. For those who oblige each request, you threat blurring the boundaries. Your position shifts from proprietor to on-call service supplier. That semi-passive revenue begins turning into energetic revenue, which is what you need to keep away from.
And when your revenue margins are already squeezed by property taxes, mortgage curiosity, upkeep, and the occasional late hire, doing unpaid “extras” can tip your rental into unprofitability.
Worse than the cash is the psychological vitality drain. As soon as you identify your self as a landlord who all the time says sure, saying no later turns into a lot more durable. Keep in mind, as somebody in search of monetary independence, your property should give you the results you want, not the opposite method round.
Discovering A Compromise
After sleeping on it, I made a decision to supply a center floor. I emailed the husband—who had been well mannered {and professional} from the beginning—and advised him I’d reimburse as much as $150 for mulch. They may decide it up themselves and unfold it round. At roughly $10 a bag, that may cowl about 15–16 luggage, which felt cheap.
This fashion, I wasn’t setting the precedent of turning into their private landscaper, however I used to be nonetheless exhibiting some flexibility. To make issues simpler, I even advised them which retailer to go to and precisely the place to seek out the mulch within the retailer. It was a small gesture, however I wished to begin the connection off on the proper foot. Just a little goodwill to start with can go a great distance over the course of a tenancy.
They accepted immediately and appeared genuinely grateful. Because it seems, at their final rental, the owner anticipated them to mulch the backyard each single yr, so that they assumed that was customary.
I defined that I hadn’t observed the naked spots sufficient to make it a part of the lease, however since they introduced it up, I used to be high quality with refreshing it each couple of years if wanted. I even steered they spray some Rock Glue to assist preserve the mulch in place and advised them I’d cowl the price of that too.
Ultimately, what may have been a sticking level changed into a small win-win. They’ll get the spruced-up yard they wished, and I bought peace of thoughts realizing we’d began our landlord-tenant relationship with a bit of cooperation as a substitute of battle.
I’m assured they’ll turn into nice, caring tenants. To start with, it’s all the time only a leap of religion.
Why Strict Guidelines Construct Higher Relationships
Assume again to highschool. Keep in mind the strict instructor who laid out guidelines from day one? At first, you thought she was harsh. However by the tip of the yr, she was your favourite instructor. Why? As a result of the foundations have been clear, honest, and constant.
After three years of teaching boys’ highschool tennis, I’ve realized the significance of creating clear guidelines. For those who don’t implement them with firmness, youngsters will shortly take a look at boundaries and disrespect your authority.
The identical precept applies right here. Clear guidelines create mutual respect. They simply have to be reviewed and understood by each events.
For those who’re a tenant: learn the lease rigorously, ask questions earlier than signing, and make clear expectations upfront.
For those who’re a landlord: evaluation the lease line by line, spotlight tenant duties, and provides tenants a number of days to boost questions. Ask them if they’ve some other issues that isn’t within the lease. You should be as thorough as doable. Preserve bettering upon your lease for subsequent time.
That small effort on the entrance finish can prevent huge frustration down the highway.
Why I’m Decreasing My Landlord Publicity
Interacting with folks could be draining, particularly when expectations don’t line up or the requests really feel unreasonable.
Take my previous tenants, for instance. They wished me to purchase three lighting fixtures that they had put in. I declined. I had already been versatile in letting them swap out the unique fixtures, so I advised them they might both depart their new ones behind or reinstall mine.
They weren’t thrilled with that reply after which requested me for the brand new tenant’s contact information to pitch them on shopping for the sunshine fixtures. I discovered the entire trade draining over a couple of dollars. I by no means would have requested my landlord to buy lighting fixtures I selected for myself. Possibly it was a cultural distinction. However to me, it simply felt like one other reminder of how mismatched expectations can create pointless friction.
If I had merely caught to the foundations and mentioned no to swapping out the unique lighting fixtures, this battle would not have taken place. However that is what you typically get for making an attempt to be versatile and good.
Though proudly owning rental properties is without doubt one of the greatest methods to construct wealth and safe retirement, I’ve reached the purpose the place the fixed hassles outweigh the rewards. Every turnover requires managing departing tenants, dealing with an exit walkthrough the place injury all the time reveals up that they’ve “no concept” what occurred, discovering and vetting new tenants, making ready the property, after which repeating the walkthrough course of. It’s a demanding cycle, and after years of managing it, I’ve determined sufficient is sufficient.
I can not wait to promote one other rental property in a few years, as by then, I’ll qualify for the tax-free exclusion rule as soon as extra.
Landlording Can Be Like Working A Company Job
One of many most important causes I left company America was as a consequence of folks. Workplace politics, tough personalities, and fixed requests wore me down after 13 years. I did not like managing folks both.
Being a landlord is commonly no completely different. Even with supposedly “good” tenants, points come up. That’s why, though I’m nonetheless bullish long-term on San Francisco actual property, I accepted a preemptive supply in 2025 for my previous main residence that was a rental for one yr.
I reinvested 100% of the proceeds into the S&P 500, particular person shares, Treasury bonds, and enterprise capital—investments that require zero folks administration. Shifting semi-passive rental revenue into really passive investments has been a aid.
When you FIRE, you may additionally resolve you don’t need to handle rental properties, for lots of the similar causes you left your job within the first place.
Classes Realized For Landlords
Listed here are the primary takeaways from this expertise:
- Set clear expectations upfront. Your lease is your rulebook. Don’t depend on verbal understandings because it opens your self as much as misunderstandings.
- Don’t change the phrases midstream. If it’s not within the lease, it’s non-obligatory, not obligatory.
- Watch out with “extras.” When you begin saying sure, tenants might preserve asking for extra.
- Defend your margins. Bills creep shortly; don’t let small favors flip into huge, ongoing obligations.
- Respect goes each methods. Kindness and courtesy matter. Tenants who deal with you properly deserve extra flexibility than those that don’t. Use your emotional intelligence to make life simpler for each side.
In my subsequent lease settlement, I plan to spell out extra particulars round exterior upkeep, make clear that the property is rented “as is,” and specify that tenants might make enhancements or aesthetic modifications solely with prior approval and at their very own expense.
The trail to constructing a livable passive revenue stream isn’t simple. The secret’s to all the time study from every expertise so the subsequent one turns into a bit of higher.
Let’s All Perceive And Observe The Lease
On the finish of the day, each landlords and tenants desire a constructive expertise. Tenants need worth for what they pay. Landlords need tenants who take care of the property and are self-sufficient. Neither social gathering desires to maintain going backwards and forwards with one another throughout the complete time of keep.
This steadiness is achievable, however solely when each side clearly perceive and observe the lease. With out expectations, frustration grows. With them, the connection has an actual likelihood of succeeding.
Landlords, have you ever ever had tenants ask for issues that went past the lease? How did you deal with it—did you accommodate, push again, or discover a center floor? And tenants, I’d love to listen to your aspect too. Have you ever ever satisfied a landlord to go above and past what was in your lease? In that case, how did you pull it off?
On the finish of the day, I believe setting expectations is the muse of a easy landlord-tenant relationship. However I’m curious—how vital do you assume it truly is, and the place do you draw the road?
Spend money on Actual Property, With out the Complications
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Fundrise focuses on build-to-rent residential and industrial properties in additional inexpensive elements of the nation. They deal with the acquisitions, tenants, and property administration—so you’ll be able to sit again and deal with the elements of life you truly take pleasure in.
I’ve personally invested over $500,000 throughout a number of Fundrise funds and a number of other accounts, they usually’ve been a long-time sponsor of Monetary Samurai. With the Fed slicing charges once more and three years of underbuilding as a consequence of excessive financing prices, I count on to see continued upward stress on rents within the years forward.
