When it comes to rental properties, most landlords are fairly “tenant agnostic.” In other words, it doesn’t matter what the tenant does for a living, what profession they’re in, where they’re from, or how much money they make. As long as the tenant passes a background check, has good referrals, and meets the minimum income threshold, that’s all that matters.
But then there are landlords who work with specific types of tenants, such as college students. Doing so requires a unique approach with special considerations, protections, and carefully-crafted lease agreements.
Military members are another example of a very unique demographic. If you choose to rent to military tenants, you have to be prepared for some of the unique complexities that may emerge. A failure to plan for some of these different circumstances could come back to bite you. In this article, we’ll explain some of the pros and cons of renting to military tenants and how to prepare if you plan to rent your property to military personnel.
The Pros of Renting a House to Military Tenants
Let’s start off with some of the biggest benefits and advantages of renting to military tenants and their families. While you could probably create a list of a dozen different reasons, here are some of the top ones:
- Reliable income. As a landlord, affordability is one of the big concerns you have with tenants. You want to make sure your tenants can afford to pay their rent each month. With military members, this usually isn’t a problem. Not only do they have a steady, reliable, but they also get a Basic Allowance for Housing (BAH) stipend from the military. This money is specifically earmarked for housing payments when living off-base.
The best part about BAH is that it’s automatically added to the service member’s paycheck each month. As a landlord, you can verify what this BAH amount is by requesting a Leave and Earning Statement (LES), which is updated on a monthly basis for each military member.
- Responsible tenants. By and large, most military tenants are highly disciplined, hardworking, structured, and diligent. Their training and work ethic teaches them to treat others with respect. This includes you and your property.
With military tenants, you don’t have to worry about them treating your property poorly or engaging in illegal activity. You’re getting quality people who will treat you fairly.
- Access to a larger pool of renters. You can join the Rental Partnership Program (RPP), which is run by the Housing Services Center. This program connects landlords with current service members looking for off-base living options. By participating in the program, you instantly gain access to an even larger pool of tenants. (Best of all, it doesn’t mean you have to rent to military members only. It just gives you the option.)
The Cons of Renting a House to Military Tenants
For all of the advantages that military tenants afford you as a landlord, there are also some potential concerns. Here are a few to be aware of:
- Moving with little notice. You have to be prepared for the fact that, at the end of the day, military tenants have a loyalty and duty to the military above all else. If they’re called to change locations or deploy, that’s exactly what they’re going to do. And, by rule, they’re legally able to move out early and break their lease without consequence. You have to be prepared for this (even if it’s not extremely common).
- SCRA Rules. The Servicemembers Civil Relief Act (SCRA) is a set of laws that protects military rental tenants. These protections include rules like: military renters can’t be evicted unless rent is over $3,851.03 per month; no foreclosures without a court order; etc. In other words, it’s extremely hard to evict a military tenant. And even if you do, it’s not a good look. It’ll put you on an unofficial blacklist and hurt your chances of securing military renters in the future.
How to Prepare for Renting to Military Tenants
After reading the pros and cons, you might be thinking to yourself: What are my options? In other words, if a military member fills out an application to rent one of your properties, do you even have the right to refuse to rent? The answer is maybe.
Federally speaking, military status is not a protected class under the Fair Housing Act. This means you can technically refuse to rent to a military tenant over fear of losing income due to deployment or other factors.
However, there are certain state and local housing protections that may prevent you from refusing to rent to someone based on their military status. It’s important that you do your research and find out what your local laws say.
Should you decide to rent to military tenants, there are some things you can do to prepare ahead of time:
- Adapt your lease to ensure it’s military-friendly. If your property is located near a base and you’re proactively seeking out military tenants, you can make your property a more desirable option by being flexible with the type of lease and specific language around deployments.
- A lot of military renters will be paying for their housing with their BAH stipend. This stipend changes based on the location and service member’s rank. Adjust your rent to ensure that it falls in a reasonable range for the BAH rate in your area. This will give you a larger pool of potential military renters.
- Hire a professional property management company to oversee your property on your behalf. This allows you to take a step back from the day-to-day management and ensure your tenants are being treated well and that your property is being taken care of.
Partner With Green Residential
At Green Residential, we’re Houston’s leading professional property management company. Whether you have one rental property or dozens, we can help you manage your portfolio so that you don’t have to stress over the hundreds of time-consuming details that go into keeping your property profitable. Want to learn more? Please contact us today.
Michael is Green Residential’s Vice President. He helps to keep the team organized and running smoothly. Prior to joining Green Residential, he spent 12 years working at Cadence Bank in the mortgage loan servicing department, where he specialized in loan audits, modifications, and bankruptcy-related issues for the mortgage portfolio.
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