I have numerous friends and family in the area that I regularly have property management conversations with. The most popular recurring topics are usually around how long X property has been vacant, or how bad X person’s last tenant was. The bad stories are always far more fun to tell, or at least more entertaining to listen to, it seems. It got me thinking though, I rarely have bad tenant stories to talk about, and I never have vacancies longer than a couple weeks. As such, my fellow landlord’s stories are always far more interesting than mine. My friends and family always ask how I get so lucky. Somehow I’m not entirely sure luck has much, if anything, to do with it. After speaking with fellow landlords, and some of our rental software users I’ve come to the conclusion that the following listings and policies can account for most renter and vacancy issues.
It starts with the listing. Do your listings set expectations appropriately?
For instance, if your listing states that you do tenant screening, this immediately weeds out most prospects who know they won’t pass a background check. Conversely, if there is no mention of screening required everyone who cannot get approved elsewhere is going to apply for your property, only to use your time and energy to ultimately be rejected when you do the background check.
Do you charge an application fee? Almost every state allows it and it is common practice as it pays for your screening expenses. If you do, mention the application fee on the listing. This will weed out all the applicants that can’t afford a small application fee.
Eliminating unqualified tenants at this step saves you the maximum amount of time and money. Instead of showing the property to unqualified applicants, you can focus on fewer more qualified applicants.
On to the application. Do you let your applicants cheat?
Whether you do online applications or paper applications, the application should be thorough and ask lots of pertinent questions. The most basic of questions should include full contact information, SSN (if allowed), birth date, employer, at least 2 most recent landlords, previous rental details, emergency contacts, employment information, and common questions about criminal felonies and bankruptcies. All this information should also be collected for any additional adults that will be in the home. A prospective tenant not willing to fill out an application entirely is not a serious renter and grounds for disqualifying the applicant. Also, if any answers do not match what you pull on the background reports, that is an instant red flag.
Don’t be a pushover.
Do you get phone fishers calling asking about your properties, only to ask before they’ve even seen the property if you will take a lesser amount? The correct answer to that question any time before an application is returned and the property has been displayed, is always “NO”. Considering a rent concessions before you’ve met the people and before they’ve seen the property tells the tenant you don’t have much confidence in the property. This leads to “can I pay rent late again this month”, and “I was really hoping it would be OK if my 12 cousins from out of town could stay just a couple more months..”.
If however, after you’ve met the tenants, if they have already passed your qualifications and need a concession to close the deal, that is the time to make a concession.
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Nathan is a member of Rentec Direct who provides property management software, tenant ach payment processing, and tenant credit and criminal reports for property managers and landlords.
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