There are many ingredients that go into becoming a successful real estate agent. Trying to master all the different pieces of the puzzle can be difficult, but one thing you definitely need to know, is what tolook for in tenants, because if you get the right tenant things will go as smoothly as can be expected,however if you choose the wrong tenant it can turn out to be very costly and stressful.
It is a good idea to have a checklist of criteria that should be meet, although in saying that, weshould not necessarily have iron clad rules but should assess potential tenants on an individual basis so that good people aren’t arbitrarily excluded. It may be that someone has recently lost their job and is living off their savings short term, but they are honest and hardworking, or someone may be temporarily affected by a health issue and some compassion would go a long way with them.
There are some things investors can look out for, when considering tenants and if you can spot these traits you are likely to succeed.
Respect for others property
One thing to watch out for, is does the prospective tenant have respect for others property? How doyou know? Well, one way is to see whether they respect their own property. Ask yourself questions like,what condition is their vehicle in, how do they present, are they clean and tidy or unkempt. If they don’t look after their own property, they probably won’t look after yours either.
Are they responsible?
Try to work out whether your prospective tenant is a responsible person. What kind of commitments do they have at work and outside of work, are there other people or animals they look after, do they do what they say will, or are they unreliable and make excuses? If your tenant is usually a responsible person then it is likely they will fulfil their obligations under lease, and should any issues arise during the term of the lease, they will probably be more easy to deal with.
Are they a good fit
Another thing to work out, is whether your prospective tenant is a good fit for the property, taking into account the size and type of the property, the neighbours, and intentions behind wanting to rent your property.
If it is only a small unit but a large family with young children is going to move in, there will be issues with noise affecting neighbours, and parking problems with limited space for cars. If the tenant likes your property because of the big shed because they want to start a home mechanic business, then you will have issues related to the use of power tools, hammers and chemicals that could create future problems even though that person would otherwise be a good tenant. If the person likes your large lawn because they want to have chickens and renting with pets, then you have to consider how much the neighbours will appreciate the rooster’s early morning wake up call.
Sometimes a tenant will tick all the boxes except one, but that one might be crucial and ignoring it could be a mistake.
As a landlord, your tenants have certain basic obligations they owe you. To prevent future problems, an ounce of prevention is better than a pound of cure, and it is worth spending some time to ensure doing your due diligence so you can make the most of your investment. Ask them questions like, why do you want to move here, how many people will be living here, and how long do you expect to stay here?
Tenants need to be in a financially sound position for the period of the lease, so you have to verify they have a reliable and constant source of income sufficient to cover not only the rental costs, but the other associated living expenses and they should be able to pay a bond. It is a good idea and what to look for in tenants is to ask them for references from previous landlords. They should be someone who will respect your property, their legal obligations under the lease, and they should be responsible and a good fit for the particular property.
Once you have learned what to look for in tenants, you are half way to success. Choose quality tenants and you can maximise the value of your rental property.
