I have a house that I plan on renting out and my sister wants to rent it.?

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me	I have a house that I plan on renting out and my sister wants to rent it.?

My payment is only 270 and I had planned on renting it out for at least 450 a month with them paying utilities, now that she wants to rent it I am afraid she thinks that I will let her rent for the 270. The least amount I want would be 375, just to keep up with the house and making sure everything stays nice and clean. I have done a lot of work on the house, gutted bathroom, paint, opening up some walls, putting in a used washer and dryer, new lights, etc. Is it wrong for me to want to charge that much for my sister? Should I make her sign a lease agreement? Or should I just tell her no so there aren't problems later on down the road.
I appreciate honest helpful opinions, if you have something rude to say about this situation please keep your comments to yourself.
Thanks for all that reply. God Bless.

Silver

First of all, regardless of who you rent the property to, you should ABSOLUTELY get a lease agreement!!! Otherwise, you're just asking for trouble. A signed lease agreement gives you a leg to stand on if a dispute winds up in court....without one, it's just "he said/she said" and WILL get messy.

Anyway, regarding your sister.....

See, this is the sort of situation that makes it hard to be a landlord to a family member or a close friend. Regardless of what you do, SOMEONE is going to get hurt feelings here. If you give her a sweetheart deal, you're going to regret it 'cause you're leaving $75 per month on the table....but if you refuse to do so, you run the risk of being accused of making money off of your sister. One way or another, it puts you in a difficult position.

If you REALLY want to rent to her, then you might consider explaining to her exactly what you put in your question. Tell her that you'd be happy to rent to her, but that you need to charge something approximating market rental rates for it. Then, have a good explanation as to why...like, "I'm going to use the extra money to finance other improvements to the house...etc...etc...etc." Then, if she balks at the price, offer to help her find another rental that's more in her price range....

Seriously, good luck...I do not envy the choice you're going to have to make here....

Charles P

family & business, does not mix vary will trust me. It well be all good at first, but after awhile, every bodies true colurs will come out.

linda

It's almost always a bad decision to loan money, do business with or rent to a relative.
good luck

BEBE

I wouldn't rent it to my sister cause that's how problems start. but if you decide to you should have her sign a lease.

gone!

Not a good idea to rent to family. IT WILL cause trouble. especially if your sister want the house for low rent. and you are trying to rent out the house to make more money. Maybe you could tell her you'll help her find something nice for low rent but you'd rather not risk your friendship with you sister by letting her have the house. If she doesn't understand then she WAS being selfish and only wanted the house because she knows you are a SUCKER for a hard luck story

Missuzarmbrister

As a real estate agent, investor and one whio has plenty of family. I never, ever think renting to a friend or family is a smart BUSINESS decision. If you do decide to do so, make it truly a business situation, have a lease signed and also--bear in mind this entire time that unless you are willing to GIVE your sister 180 dollars a month during this time...that she needs to pay the market rate. (thats the difference you would see in your rental numbers ++ you get the dubious honor of being required to claim this as rental income and must pay taxes - an even bigger loss if she doesn't pay enough to offset your new tax ramifications.) Seriously - let her know your costs, what you've spent and that you need this money and were relying on it for your own future. Bottom line - if you do rent to a family member - be prepared to not get paid at all and to damage your relationship if things go South.and that they often do. I wish you the best. (you're not a bank are you?) ;-)

Make her sign a lease and also have all of the utilities put in her name. As for how much to charge... make sure that you are able to make money off of it. I am assuming that is why you have the house to begin with. Considering the amount of work that you put in and the upkeep on the place, 450 is a reasonable rate. I assume that is comparable to what she would pay elsewhere.

Kelly R

if you do it get a lease ,but trust your instinct I think you already get the feeling where this is heading, and if you have to evict her you will get nothing but grief from other family members. Do not lower the rent if 450 is the going rate in your area you should not except less.

elpalmes

doing business with a relative is a big no-no. exceptions to this are big corporations where family members must work together, but even if it so, each family member is bound to abide rules all written in black and white.

now your problem is a simple one. you can and should rent it out to your sister. after all, family should help each other out. but prepare for the complications afterwards.

while these complications may not be apparent at the beginning, since both of you will do each best not to hurt each other in any way, it is still best that you prepare ahead of these complications.

the rent. base your fee on the current rentals on the market, but give your sister a little discount. just how much? it's up to you. there will be a gut feeling that will tell you just how much it should be. just remember that even if it is your sister, you are still doing a business.

the legalities. talk with your sister. tell her about your doubts and concerns. it is not necessary to have a lease agreement between both of you. but still raise this issue with her. the lease agreement will protect both of your interest, but still if both of you will agree and act in good faith, there's no need for one.

Leo F

Never, Never, Never rent or co-sign to family or friends, . They will take advantage of you, trust me on this one. And you know she wants it for $270 a month, this is a income producting prop. you bought it and you fixed it up you got the mtg on it with your good credit. Why should you eat the $180 dollar profit on it. You need to put money in the bank for reserve replacement for roof, carpet, furnace, all of these items will need to be replaced in the future and if you have not put money away, it will come out of your pocket when needed not hers. Good luck but I would tell your sister sorry but I cant mix business with family or friends. Look at it this way if you rent it to her and she stopped paying rent are you going to be able to kick her out and what would happen to her if you did. The hole family would be mad at you. Remember no good deed goes un-punished and you will be the bad guy.

Trouble

Renting to friends or family is never a good idea. It very rarely goes well. It my start off all happy and nice, but once you have to assert your rights as a landlord, it will go bad, fast.

Siblings see themselves as your peer and in a rental relationship they are not. They are your tenant. Family and friends will overstep boundaries because of your personal relationship. They do not intend to, but they have a hard time seperating the two relationships. You can be left torn betwen making a decision that is good for your business but may harm your personal relationship.

I've been in this situation several times. I own rentals and family (and friends of family) seem to feel that I am obligated to rent to them regardless of whether it is a good business decision for me or not.

My brother needed a place to stay for about a year.

When he came to me, I told him that I could not do it because I loved him too much and that my relationship with him, his wife and kids was too important to me to put in jeopardy over a rental.

Initially, he was shocked, but he ended up calling me and thanking me. We are best buds to this day. Had I rented to him, I honestly believe that we would not be.

I_Love_McRedneck

Never mix family and business, that's a great way to wind up losing a sister.
If you do decide to let her live there, it should be at $450 a month on a standard lease or signed month to month agreement.
She has to understand that you need additional money to pay for any repairs that should arise while she's living there, and that's what the extra money is for.

Rico

Whatever the rent you should insist on a lease agreement, it's only good business. If you are afraid to offend then tell her that you may need it for credit purposes if you apply for a loan and want to cross your t's and dot your i's.

reenzz

I learned this lesson the hard way. NEVER rent to relatives or friends. I purchased my 2 family home 10 years ago. I let my sister and her family move in to my brand new apartment for a very reducted rental rate (market rate back then was 900.00/month..reduced it to 400.00/month). She payed for the first few months and then just stopped paying. It cost me close to 3,000.00 in lawyer fees to get her out and close to 2,000.00 to repair damages she left to the unit.

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