Find Good Tenants – The Key to Investment Properties
Many property investors wonder if there is one key tip or principal to making the most money from their rental properties. The major focus of landlords or property management companies should be to find quality tenants. Quality tenants result in less property maintenance by the landlord down the road, and the property is better cared for meaning less repairs between leases. So how does one go about finding the best quality tenants, in turn resulting in less maintenance and repairs down the road?
- Carefully screen tenants by collecting detailed employment history and previous rental contacts. Get in touch with the previous landlord and find out if rent payments were made on time, and if the tenants took care of their the property.
- Check the prospective tenants credit history. If a management company is leasing out the property, they will already have access to credit check resources. If you are leasing and managing the property yourself, then it is best to pay the up front fee to get a credit report. Verify outstanding debt from the credit report and ensure the credit score is between an average to high rating.
- Interview the prospective tenants in person. Whether this is during the property walk through, or a separate prearranged meeting, this encounter will provide you the most insight into if the tenants are the right choice for you. Observe their behavior, how they answer or dodge your questions. Also take notice of how they dress and carry themselves, as well as the condition of the vehicle they drive. People that take care of themselves and possessions are more prone to taking care of things other people own.
- Spruce up your investment property before showing potential tenants the property. Make sure the property is immaculately clean, neatly painted, and the outside is well manicured. This will show the tenants how much you care about the condition of the property. Bad tenants are generally attracted to dirty and unmaintained property conditions. On the other hand good tenants seem to gravitate towards nicely maintained properties.
Following the few simple tips above can help to identify high quality tenants. The extra effort will pay off greatly by having less repairs and maintenance costs over the long run.