What to do with dead tenants

The hardest part of investing in real estate is property management. Sometimes it’s more tenant management than property management, but either way….

Next to concerns over cost and market projections, dealing with tenants is the biggest worry for someone looking to invest in real estate. And it should be. Why?

YOU FIND DEAD BODIES

Not that often, and it’s not always that bad, but you still find them.

My family owned a property management firm for over 20 years, and I drew my first paycheque from them at age 12. When I left, we were managing well over a thousand units. That can be well over 2,000 people in our buildings. We’ve had at least three deaths I can remember, and one close call (but that’s another story I’ll let my Dad tell).

The typical death in a rental is an older person with few family or friends in the area. They die of natural causes. Then one of three things happens:

1. The resident manager (if you have one) or a tenant notices they haven’t seen Bob around lately and goes to knock on the door. No answer. They try again the next day. No answer. So they call you, and you deliver a 24-hour notice to inspect. Note: If you have cause to believe that they’re actually dead or injured, and there’s no response, go in anyways, right now. You might save someone’s life, and it’s better to piss someone off than to walk away from someone who has suffered a stroke. And yes, I’ve seen it. This is part of why everyone should take Standard First Aid.
    
2. Bob’s had a heart attack and fell out of his lazy boy onto the floor before he died. He’s been there about 2 weeks, and you get a call from another tenant, neighbor, or your all-star resident manager about a smell. If your dead-guy radar (as opposed to your slob/OCD radar) is tingling, it may make sense to call the cops before you leave the office.
    
3. Bob happened to have a heart attack while in the bathroom with the door closed and the fan on. The only reason you figure something is up is he hasn’t paid the rent. You deliver a 14-day eviction notice for non-payment. It expires. You try the door to see if he skipped…..and find a month old dead body. This is the least cool part of the three options. I supposed there’s always a fourth option, but you can use your imagination on that one.

Now you’ve found the dead body.

You’re going to have to call 911, tell them you found a tenant who is dead, and would they please send an ambulance. The cops will come over too. They’ll ask you some questions about the person, so now is a good time to step into the hallway, close the door, and call the office to get the dead person’s vital stats, info, and next of kin contact for the cops. They’ll haul the body away, and you’ll be left to clean it.

In one case, we found a tenant who was dead about 2 weeks. Cleaning up the suite was a very expensive proposition. We had to rip the flooring out all the way down to the sub-floor. Sometimes it’s as simple as having someone haul away the junk (the normal junk haulers may not touch this, as there can be a bio-hazard element), and having a disaster company clean the carpets and ozone it. Sometimes it’s more complex. Either way, just be thankful you’re still alive.

When you’re dealing with a situation like this, don’t start skimping on costs. You need to contact a professional. If there are pathogens breeding under the carpet, you’re going to have a nightmare like never before. Get the pros, and accept that it’s going to cost you.

Be sure to consult with the applicable laws for the disposal of the person’s effects. While you can, under certain circumstances, sell them to pay for unpaid rent or cleaning costs, it’s often better to just let the family take it all. They’ll often pick up the costs, or you can make a claim on their estate. In at least one case during the summer of 2008 I had a suicide in a building, with no known family. The Alberta Government was settling the will, and we submitted a claim for the $3000 in cleaning costs and a month’s back rent. So far as I know we still haven’t seen any money out of it, but the suite is clean and rented to a new tenant (who has no idea the former tenant didn’t move out in the usual way).

And pray for the dead person. I can’t imagine how much it must suck to die and not have anyone find you for a couple of weeks.

Learn more about Real Estate Investing with Don Campbell’s Best Selling Books, including Real Estate Investing in Canada and  97 Tips For Real Estate Investors!