The landlord/tenant relationship is generally a voluntary one. Person A, the landlord, has a vacant property they wish to rent. Person B, the tenant, needs a place to live. The marketplace brings persons A and B together. They examine what each other has to offer, negotiate a price and decide to make an exchange. Person A agrees to let Person B live in their property for a certain amount time and amount of money. Everyone walks away from this voluntary transaction in a more favorable position, otherwise they would not do it.
Most voluntary business relationships are easy to end. One simply has to stop gong to a particular restaurant or store and that ends it. Or, the owner of the restaurant or store can refuse you service. With residential real estate rentals, it gets a bit more complicated. The landlord/tenant relationship has evolved over the years to remove this ease and actually penalize it. In doing so however, each side generally benefits.
Nearly all businesses, and landlording is no exception, desire stability and continuity. Businesses want to be able to determine the income that will be coming in and for how long. On the flip side, they do not want to lock themselves into a disadvantage if market conditions change. Tenants want some security. They want to know they they will have a place to live. After all, I would hate to have to move every month. These wants from both sides have evolved into the long term lease. Most residential landlords now use a long term lease of at least a year that bind both parties to location and price. Thus creating stability and continuity. Neither party can simply pull the plug on this agreement without some kind of penalty or compensation.
When the lease term expires, either party can usually end the landlord/tenant relationship just as easily as it was started. The tenant can simply move or the landlord can choose not to renew, thus requiring the tenant to move. But what if the tenant does not want to move? What if they really like your property and want to stay? Can they? Can they force the relationship to continue?
The answer is usually no. But, if they refuse to leave after you have asked them to do so, you may be faced with filing what is called a “no-fault eviction.” In other words, you are filing to force the end of the relationship for no other reason than that is what you want to do. The tenant may be paying you rent. The tenant may otherwise be a model tenant but you want possession of your property. Perhaps you want to remodel. Perhaps you want to sell. Whatever the reason, your wish is to regain control of your property.
As rents continue to rise and the number of rental units continue to decrease in some areas, more and more tenants are starting to balk at being asked to move. They do not want to pay more rent somewhere else and their selection of properties to move to has decreased. In turn, tenants begin to ask politicians for help and politicians offer it by enacting bans or restrictions on no-fault evictions. Such events are happening in California and in Washington State and are forcing landlords into relationships that were once voluntary. Will this trend increase? Stay tuned and stay informed as to what your local politicians are doing.
Any readers try to conduct a no-fault eviction recently and hit problems? Let me and other readers know with your comments.
Kevin Perk is the founder and publisher of Smarterlandlording.com. He is the author of Advice From Experience To New Real Estate Investors. Subscribe to Smarterlandlording here. Contact Kevin here.
