We have a beach house that we rent out every summer so that we can pay our mortgage. For the past 2 years our neighbors at the beach, their friends from their area have rented out one week at our house and had a great time and have been excellent tenants. I have offered them a discount of 0 each summer because they are friends with our neighbors.
Let me preface this by saying that our lives are incredibly hectic due to running our own business, my husband has 2 jobs, we have many children and one of them has issues. And we have no help at home. So, being a landlord is one of my lowest priorities (family and work come first), but I truly try my best to make sure that people are happy when renting our home.
This past summer, there was major water damage at the home, caused by a clogged toilet upstairs (housecleaner clogged it). These friends of our neighbors were renting that week and walked in to find the major damage. I had a restoration service come in, insurance adjustors, etc., and the service tore out the walls, ceilings, carpets etc and it was a major mess, with huge dehumidification machines running for the rest of the week, floors torn up, it was not a fun place to be in. My insurance co. told me that all lost rental income would be reimbursed to us, so this family opted to stay in the home instead of moving to a motel that would cost them twice as much. I actually would have preferred that they left so that we could have the contractors in there nonstop, but they wanted to stay. They felt that they were doing us a favor by staying and monitoring things, but we didn't need them to stay. I felt so badly at their horrible living conditions and their ruined vacation week, that I blurted out "we will let you stay for free next summer" but immediately regretted it and my husband doesn't agree that they should get one free week (albeit in wretched conditions from last summer) AND a free week this summer.
They had only paid half of the rent for that week up to that point anyway, (they were bringing a check for the second half) so we only owed them half of the rent back.
We lost numerous weeks of rental income and had to reimburse those people immediately (before receiving the insurance reimbursement). Instead of having the restoration co do the renovations, we decided to use our own contractor so we also had to pay our contractor for his work, and purchase all of the replacement materials (flooring, bathroom sinks, tiles, etc.) It was really hard on us financially as we depend on that summer income to be able to pay the mortgage.
Unfortunately, our insurance reimbursement process has been dragged out for months due to: Our contractor was doing the work and then suffered a heart attack/stroke and almost died and was in the hospital, just got released last month. In addition, the insurance adjustor dragged his feet in doing the paperwork and we had to hound him for everything and it was really frustrating. The insurance co will not pay us the remaining half that was promised until the work is 90% completed, and the contractor can't go back to work for at least another month. So, we've only received dribs and drabs from the insurance.
I told the family that I would refund them their half/rent as soon as I got reimbursement from the insurance. They told me that was fine and didn't ask me for the funds. However in December they asked me about the check and that same day I received a partial payment from tthe insurance co. I mailed them the check we owed them, and it was LOST by the postal service (sent via priority mail and it was lost, the postal service is investigating but can't find it). They asked me a week later where the check was, I didn't know it was lost til then, and I promised them another check but it took me a few days to send it just because I have been crazy busy at work and home (sick mom, etc.). Got a mad email from the husband saying they've been incredibly patient, but don't know why this has taken so long, and they are looking forward to their free week this summer, but they are very angry and they didn't believe that I mailed that first check like I said I did (the one that was lost).
I truly did not mean to delay them getting their check but didn't have the funds to be able to refund them and thought they could wait.
My question is, for this summer, how much of a discount should I give them? The main problem is that they are friends with our beach neighbors and so I'm being judged by everything I do, by our neighbors whom I don't want to offend. I feel badly that I didn't refund them earlier, but I have a really busy life and didn't mean to offend them. It's been a great situation until now and that's why I hate renting to people whom we know, as something bad like this may happen. I was thinking of offering them 0 off but is that enough? Do you think I should charge them half off, but that is a huge amount? Keep in mind that they are "expecting" a free week
Just to clarify, we were forced to refund *other* renters payments as they could not stay in our home and had already paid. I did not refund the family in question's rent until recently. Hope this makes sense!
Thanks so much, appreciate your advice!! Just to let you know, even though they are great renters, it will be a relief to not have them rent anymore and yes I do realize that they probably won't come back anyway after these problems. I actually don't want any more renters referred by our neighbors for this exact same reason so that is fine, as it gets weird/uncomfortable for everyone involved.
Oh and I'm sure they received the new check (to replace the lost one) that I mailed them today.
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