If you own enough properties, and rent to enough people, sooner or later you’re going to have a tenant die on you. So far, Ive had this happen twice to me, once was unexpected (a young tenant of mine was killed in a vehicle accident), the second was known well in advance (my tenant succumb to cancer). While I recommend always keeping relationships strictly business, it does affect you no matter what. Dealing with the death however has some unique issues that can affect the landlord.
When someone dies, their accounts are frozen at the time of death. If the tenant owes you money, you’ll have to submit your claims to the executor and wait until the estate is divided. If you owe money back to the estate (damage deposit) you’re obligated to return it.
If the tenant dies, chances are all their stuff will still be sitting in your rental. You can’t just throw it out. Hopefully the relatives will remove the goods quickly, but remember, they are grieving and have a lot of issues to deal with. You might have to store the goods for a while, the time you need to do this for is determined by provincial law.
Fortunately, I’ve never had to deal with this one, but there is a chance you’ll be the one to discover the body of your tenant, or be asked to open the door for a concerned relative/person. For some people, this can be a tough thing to deal with.
Nothing quite has the smell like decay, and it can be very hard to get rid of. I know a guy who got a very good deal on a property because the old owner wasn’t “discovered” for a long time. In the end, the place had to basically be stripped down to the foundation and rebuilt. Probably another good reason why you should always check up on your tenants on a regular basis.
By law, you need to disclose is someone dies in your property when you go to sell. While not always an issue for people, it can limit potential buyers who don’t like the idea.
Lesson: Making money sometimes has unexpected bumps in the road, be sure you think about how and if you are able to deal with them.