You finally evict your tenant after not receiving rent for three months – only to find that the dishwasher has been leaking into the basement for the last three weeks. There’s water damage, a mold problem and it doesn’t look like you’ll ever see the rent you’re owed.
Unfortunately, this is not an uncommon scenario for rental property owners. Many assume that once they’ve bought a property, the hard work is done and it’s time to watch the money come rolling in. In reality, they’re missing what may be the most important step to profiting from investment real estate: finding a quality tenant to rent that property.
Promote your property through a few different mediums, such as signs, online ads and word of mouth
Finding the Right Tenant for Your Rental Property
Finding the right tenant is often time-consuming, which is why many property owners feel they can’t be bothered. After all, no owner likes his or her rental property to sit vacant – it hurts the bottom line. But it can be much, much worse to fill that vacancy with a bad tenant. A vacancy can mean eating a mortgage payment, but a bad renter could mean headaches, damage, legal bills and maybe even eating mortgage payments anyway. The good news is, finding a good tenant can be boiled down to two simple steps: collection and selection. This involves advertising the rental property to get a good pool of prospective tenants, then screening them to ensure you get the best renter possible.
Advertising Your Rental Property
The more fish you catch, the more likely it is that you’ll find a good one in your net. Start your search for a tenant by writing a strong ad for your property that lets people know what you have to offer. Then, post it where a large percentage of your target audience is likely to see it. This means you’ll have to field some calls and requests from people who are only marginally interested, but this extra effort should pay off by giving you more renters to choose from. Be sure to promote your property through a few different mediums, such as signs, online ads and word of mouth. Don’t forget that how you advertise says a lot about how you behave as a landlord. Lazy landlords post lazy ads and the public will likely make that connection. Actually, the things that work when selling a house should work for advertising a rental property – details, pictures and just enough description to get your audience’s attention.
Lazy landlords post lazy ads and the public will likely make that connection
Screening Interested Tenants
There are things about people you’ll never know by meeting a renter. You have to ask questions and be satisfied with the answers. First, you do not want to have a tenant who has a history of blowing off his bills. You can learn about these kinds of habits by contacting the prospective tenant’s current and previous landlords. Be specific about your questions, and consider asking whether the tenants you are considering have paid their rent on time in the past, whether they smoke, and whether they’ve caused damage in other places they’ve lived. If your questions raise any specific concerns about these issues, you can dig a bit deeper when you interview potential tenants.
Interviewing Potential Tenants
Despite the cost of vacancy, it’s not worth rushing to put just anyone in that space
While there is nothing wrong with gathering some preliminary information with an application, there is no substitute for a face-to-face meeting; this is why an application is rarely enough to land someone a job. Much like conducting a job interview, interviewing a potential tenant is a good way to find out whether that person will be a good fit for you and your property.
It’s easier to spot inconsistencies in stories and background information when you have a conversation, and meeting someone helps you ensure they are who they say they are. And don’t forget – if more than one person is going to be a tenant, you need to meet everyone. That includes significant others, children and pets. The bottom line is you want to know who you’re renting to. Just giving a stranger a key to your property isn’t a sound way to do business.
When it comes to renting out your property, there is no substitute for due diligence. You have an expensive asset that you’re entrusting to someone and despite the cost of vacancy, it’s not worth rushing to put just anyone in that space. Prevention is the key to protecting your real estate investment, so take the time to choose a tenant who will help you realize a better return on your property and avoid major headaches down the road.
by +Alan F Macdonald REALTOR® | Copyright © – gimme-shelter.com