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Pitfalls Of Renting To Family Friends Blog

Pitfalls of Renting to Family & Friends


As a property management company we manage property for a wide range of clients from accidental landlords to astute real estate investors.  A growing segment of our clientele consist of owners that only have (1) rental property which is usually their former primary residence. Many of these owners start out trying to self manage until inevitably something negative occurs that invokes them to seek professional property management.  In many cases, the final straw comes after dealing with the fallout from renting to family members or friends.


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Rental real estate should be treated like any other business venture but if you’re not accustomed to being a landlord it seldom is.  New landlords typically make the mistake of filling their vacancies with friends or family members to avoid having to actually deal with finding a qualified tenant.



Initially, the situation may seem like a great way to reduce costs associated with marketing and vacancy. In most cases the owner/landlord will typically relax qualification measures and make concessions based on the relationship, including not requiring an application or security deposit.


Approaching the process in this manner creates a relaxed environment and allows the family member or friend to perceive the situation as somewhat casual and flexible as opposed to contractual.  Furthermore, the landlord develops a false sense of security because of their relationship with the tenant.  Unfortunately, the truth is that many of these situations are clouded from the start and consequently turn out worse then when a normal tenancy goes wrong.


This clouded thought process is the failure of the owner to consider the consequences that things can and will go wrong. All tenancies, regardless of how good or bad, have a beginning and end, rent increases, repairs, good and bad times.  This is just the nature of managing rental property.


How will you handle the family member or friend that can no longer pay their rent, consistently pays late, or worse damages your property? Are you prepared to increase the rent on your cousin, impose a late fee on your uncle, or evict your friend?  Will this cause discomfort and issues within your family or strain a long-term friendship?  These questions should be considered and strongly factored into your decision.


Please note that renting to family and friends doesn’t always turn out bad, but when it does the outcome can carry long term consequences.  Let’s face it — there is no guarantee that anyone will be a model tenant but handling the recourse of a bad tenancy is very different when dealing with family or friends. Having a third-party property management company as a buffer zone can be a big help in avoiding these situations and mitigating them should they occur.



For more helpful landlord tips download my Free 27 Page eBook “How to Avoid Bad Tenants

We hope you enjoyed reading Pitfalls of Renting to Family & Friends.

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Written by Salvatore Friscia, owner of San Diego Premier Property Management a full service residential property management company offering Worry Free property management to the greater San Diego area since 2004 and


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