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 individuals and one in every of your most dear belongings, the margin for frustration is excessive.
If you wish to be a profitable landlord—and never get run over—it’s essential to 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 publish is a part of a sequence chronicling my journey as a landlord since 2005. My aim is to present readers a clearer image of what’s actually concerned for those who’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 dwelling costs close to all-time highs, mortgage charges nonetheless elevated, and the continued AI boom 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 income, not simply the upstairs whereas retaining the downstairs empty. I listed it on Craigslist on a Tuesday and was instantly bombarded with curiosity.
By Saturday, I hosted two personal showings for glorious potential tenants. Each teams needed the place on the spot. One spouse was so excited she actually shouted: “We’ll take it! I wish to transfer in proper now!” when she was leaving.
These weren’t flaky candidates both. They have been organized, enthusiastic, had nice jobs, and glorious credit score. It was troublesome 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 lease.
All the pieces was shifting easily. Or so I assumed.
Making 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 every little thing prime to backside, and tackled a large quantity of yard work. It felt extra like we have been prepping the home on the market than for lease.
Our earlier upstairs tenants had been strong, however they uncared for the yard. So my children and I rolled up our sleeves and started working reseeding, trimming bushes, pulling weeds, and watering every little thing again to life. Doing property maintenance alongside my kids is one thing I plan to maintain up. It builds their work ethic, offers them hands-on data, and helps them admire the worth of caring for what you personal. Working with them additionally makes me extra obsessed with addressing points.
On prime of that, as a result of the potential tenants needed to maneuver in as quickly as potential, I needed to work out an earlier exit with the present upstairs tenants. That meant negotiating a prorated lease, agreeing on a cushty move-out date, and ensuring they returned the unit in its unique situation. Not simple dealing with each side! In the long run, 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 pleasure of possession and reciprocate by caring for the place. And as a landlord, it’s additionally a psychological reset. You’re feeling good understanding 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.
- Good friend arriving at 11 to assist unload a van of extra delicate objects the tenant introduced.
- Foremost movers coming at 11:30 with a big truck.
All the pieces about him was orderly and respectful.
The spouse confirmed up later, round 11:15, clearly harassed from the packing and logistics at their previous place. The enjoyment she’d proven when she shouted, “I wish to transfer in proper now!” was nowhere to be discovered.
After I greeted her with a smile and a “hi there,” she barely seemed up. No massive deal, I informed myself—this can be a enterprise transaction, not a friendship. Transferring is anxious and loads will need to 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 one of the best.
The Shock Request
Every week later, I occurred to be driving by and noticed them exterior working within the yard. This was encouraging. I pulled over to say “hi there,” and shortly seize a scorching 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 completed. Or at the very least how she was having fun with the place. As an alternative, I felt like an worker being given a directive, one thing I’m not accustomed to after retiring in 2012. All these hours my children and I had spent reseeding, trimming, and watering? Apparently meaningless or not ok to their requirements.
I muttered a noncommittal, “Perhaps,” and left with a “goodbye” for good measure. I wanted time to consider her request after the lease was signed.
Setting Clear Expectations
I pleasure myself on offering a terrific product for the lease individuals pay. That’s why I used to be a bit stunned by her request, and likewise 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. In actual fact, it explicitly states tenants are chargeable for sustaining the yard and crops.
Through the personal exhibiting, they by no means talked about mulch. Throughout lease assessment 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 all of a sudden disappear and this brief time frame.
That is precisely why setting clear expectations is so vital. If one thing isn’t within the lease, it shouldn’t all of a sudden develop into a requirement.
The Slippery Slope Of Giving In
Right here’s the hazard: when you begin giving in to further requests, expectations balloon.
In case you purchase and unfold mulch, what’s subsequent—a Toto Washlet and new lighting fixtures at your expense? The record of needs may be infinite. As an illustration, 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 wonderful. I had simply repainted a kind 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. In case you oblige each request, you threat blurring the boundaries. Your position shifts from proprietor to on-call service supplier. That semi-passive earnings begins turning into lively earnings, which is what you wish to keep away from.
And when your revenue margins are already squeezed by property taxes, mortgage curiosity, upkeep, and the occasional late lease, doing unpaid “extras” can tip your rental into unprofitability.
Worse than the cash is the psychological power drain. As soon as you identify your self as a landlord who at all times says sure, saying no later turns into a lot more durable. Bear in mind, as somebody seeking financial independence, your belongings should be just right for you, not the opposite manner 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 informed him I’d reimburse as much as $150 for mulch. They might choose it up themselves and unfold it round. At roughly $10 a bag, that might cowl about 15–16 baggage, which felt cheap.
This manner, 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 informed 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 needed to begin the connection off on the fitting foot. Slightly goodwill at first can go a good 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 normal.
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 wonderful with refreshing it each couple of years if wanted. I even recommended they spray some Rock Glue to assist hold the mulch in place and informed them I’d cowl the price of that too.
In the long run, what may have been a sticking level become a small win-win. They are going to get the spruced-up yard they needed, and I bought peace of thoughts understanding we’d began our landlord-tenant relationship with a bit cooperation as an alternative of battle.
I’m assured they’ll develop into nice, caring tenants. To start with, it’s at all times only a leap of religion.
Why Strict Guidelines Construct Higher Relationships
Assume again to high school. Bear in mind the strict instructor who laid out guidelines from day one? At first, you thought she was harsh. However by the top of the yr, she was your favourite instructor. Why? As a result of the principles have been clear, honest, and constant.
After three years of coaching boys’ high school tennis, I’ve realized the significance of creating clear guidelines. In case you don’t implement them with firmness, youngsters will shortly check boundaries and disrespect your authority.
The identical precept applies right here. Clear guidelines create mutual respect. They simply should be reviewed and understood by each events.
In case you’re a tenant: learn the lease rigorously, ask questions earlier than signing, and make clear expectations upfront.
In case you’re a landlord: assessment the lease line by line, spotlight tenant tasks, and provides tenants a number of days to lift questions. Ask them if they’ve some other considerations that isn’t within the lease. You should be as thorough as potential. Maintain enhancing upon your lease for subsequent time.
That small effort on the entrance finish can prevent monumental frustration down the street.
Why I’m Decreasing My Landlord Publicity
Interacting with individuals may be draining, particularly when expectations don’t line up or the requests really feel unreasonable.
Take my previous tenants, for instance. They needed me to purchase three lighting fixtures they’d put in. I declined. I had already been versatile in letting them swap out the unique fixtures, so I informed them they might both go away 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 alternate draining over a couple of bucks. I by no means would have requested my landlord to buy lighting fixtures I selected for myself. Perhaps it was a cultural difference. 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 principles and stated 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 at all times reveals up that they’ve “no concept” what occurred, discovering and vetting new tenants, getting 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 am unable to 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 foremost causes I left company America was on account of individuals. Workplace politics, troublesome personalities, and fixed requests wore me down after 13 years. I did not like managing individuals both.
Being a landlord is commonly no completely different. Even with supposedly “excellent” tenants, points come up. That’s why, although I’m nonetheless bullish long-term on San Francisco actual property, I accepted a preemptive offer 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 venture capital—investments that require zero individuals administration. Shifting semi-passive rental earnings into actually passive investments has been a reduction.
When you FIRE, you may additionally resolve you don’t wish to handle rental properties, for most of the similar causes you left your job within the first place.
Classes Discovered For Landlords
Listed below are the principle 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 necessary.
- Watch out with “extras.” When you begin saying sure, tenants could hold asking for extra.
- Shield your margins. Bills creep shortly; don’t let small favors flip into massive, 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 could make enhancements or aesthetic adjustments solely with prior approval and at their very own expense.
The trail to constructing a livable passive income stream isn’t simple. The hot button is to at all times be taught from every expertise so the subsequent one turns into a bit higher.
Let’s All Perceive And Observe The Lease
On the finish of the day, each landlords and tenants need a optimistic expertise. Tenants need worth for what they pay. Landlords need tenants who take care of the property and are self-sufficient. Neither occasion needs to maintain going forwards and backwards with one another throughout your entire time of keep.
This stability is achievable, however solely when each side clearly perceive and comply with 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 feel setting expectations is the muse of a clean landlord-tenant relationship. However I’m curious—how vital do you suppose it truly is, and the place do you draw the road?
Put money into Actual Property, With out the Complications
Don’t wish to take care of tenants, late-night upkeep calls, or chasing lease checks—however nonetheless need publicity to actual property? Take a look at Fundrise. With over $3 billion in belongings underneath administration and a minimal funding of simply $10,
Fundrise focuses on build-to-rent residential and business properties in additional inexpensive elements of the nation. They deal with the acquisitions, tenants, and property administration—so you may sit again and deal with the elements of life you really take pleasure in.
I’ve personally invested over $500,000 throughout a number of Fundrise funds and several other accounts, and so they’ve been a long-time sponsor of Monetary Samurai. With the Fed slicing charges once more and three years of underbuilding on account of excessive financing prices, I count on to see continued upward stress on rents within the years forward.
