In recent years, the issue of defaulting tenants in Mexico has been increasing, creating complicated situations for property owners renting out homes. According to data provided by the specialized platform Hofix, 25% of people who rent a home usually accumulate an average of eight months without paying rent, causing damage to the property and often requiring evictions with police intervention.
Luz María Hernández, owner of an apartment building in Mexico City, recounted her experience with defaulting tenants, mentioning that after the Covid-19 pandemic, issues of unpaid rent have worsened. She described situations where tenants do not adhere to payment deadlines, are evasive, and even dare to challenge landlords when asked about payments.
Benjamín Labra, director of Hofix, alerted about the negative economic consequences faced by landlords due to tenant payment defaults. Besides rental delays, owners face additional expenses as they must resort to legal processes to evict defaulting tenants, which can amount to up to eight months of losses: three months for unpaid rent, three months for the eviction process, and two more for the costs of the judicial procedure.
The process to evict a defaulting tenant involves going to the courts and following a series of legal steps that can take up to two years to resolve, due to court congestion and judicial reforms. Federico Sobrino, founding partner of the Institute of Property Managers, detailed that after notifying the tenant and giving them a period to respond to the demand, their belongings may be seized if no agreement is reached.
In light of this issue, it is recommended that property owners conduct thorough research on potential tenants, request proof of income, and consider hiring a lawyer specialized in rentals to avoid prolonged payment defaults. Additionally, there are services like Hofix that offer protections to owners, covering up to 12 months of rent in case of default and conducting investigations to ensure tenant solvency.
