DARLENE HIGA (RA), RMP
The Realty Company, Ltd.
Past President, Oahu Chapter
National Association of Residential Property Managers
Q. I have a four bedroom house with an ohana attached. Since our kids have moved to the Mainland my husband and I moved into the ohana and tried once to rent the main house. We rented it to a couple with a teenage daughter. Three months into a six month lease their son, his wife, and their three kids moved in. We protested that they were not on the lease but they ignored us. When the lease was up I refused to renew and threatened court action since they were now holdover tenants. They left. I haven’t rented the place out for a couple of years.
My question is, what rights do I have? Can’t I rent a large unit as a smaller unit and charge a lower rent or must I rent it as a four bedroom unit?
A. There are several issues here and this is a very common occurrence even with us in the professional property management business. The two main things I would like to emphasize is documentation, documentation, documentation – and communication, communication, communication.
The lease indicates who is authorized to reside at the property. Once you are aware unauthorized people are residing at the property, a notice should be issued regarding this lease violation.
Should the existing tenant request that an additional person be added to the rental agreement, you should go through the same steps as if they are a new applicant – credit checks, verification of income and/or employment, previous landlord verification, etc. Once that has been completed and you authorize this additional tenant to be added on to the lease, you should document this either by a new lease or at the very least a letter clearly stating who is now authorized to reside at the property.
When the lease is up, assuming that the tenants were on a fixed lease with no rights of an automatic rental extension, they would be required to vacate by that date. However, please keep in mind that it’s not a good idea to assume that they will be out by that date. Therefore, again documentation… we suggest that if you will not be renewing the lease, a letter be sent to inform tenant that the lease will not be renewed and that they will be required to vacate by that date. We recommend that this letter be sent at least 45 days prior to the ending date of the lease. This is to provide the tenant ample time to search for another place. It is not realistic to approach tenant one week before the lease expiration and expect them to be out within a week.
As the date gets closer – again documentation you would want to send another letter informing them that the date is approaching and if they are not out by that date, then per the rental agreement, they may be considered a holdover tenant and may be charged two times the rental amount.
You should be aware that if no legal action is taken during this holdover period and if the tenant remains in possession of the property for a minimum of 60 days with no new rental agreement, then the lease will revert to a month-to-month tenancy. This will nullify the holdover situation and return the rental amount to the original rate.
To address your issue regarding what is included and not included in a rental. You should indicate on the rental agreement what exactly you are renting and what is not included in the rental of a property. An example would be if the storage room on the side of a dwelling is not part of the rental, this should be clearly excluded in the rental agreement so the tenants don’t simply assume they can use it for storage of their personal items. Any area that tenants will not have access to or will not be allowed to rent should be closed or sectioned off. The size of the area you will not allow tenants to use may affect the rental amount for the property.
We cannot emphasize enough that once a property becomes a rental unit, the landlords/owners/property manager should all be familiar with the state and federal rules and regulations regarding property management, fair housing, etc.