It’s easy right? Put up a “for rent” sign in the yard, post your property on Zillow and sign up a great tenant… not so fast there, Kemosabe!
If only it was that easy. The truth is that finding a great tenant is not as easy as it seems. I have learned how to place the best tenants in my units, but not without learning some hard lessons along the way.
It is crucial that you spend the time on the front end finding and screening good tenants. It will save you BOATLOADS of time, money, and stress on the bank end.
Here are some things I have learned through trial and error that should snag you the highest quality tenants:
1. Take professional pictures of your property; it will produce MORE showings and applications. One key to finding the best tenants is to have a high turnout. Potential tenants are looking through dozens of ads so by posting your property for rent with professional, well lit pictures you set yourself above the competition.
2. Post your property for rent on multiple websites. My property management software does the majority of this for us, but we post our rentals on Zillow, Realtor.com, Hotpads, Trulia, Facebook, and Instagram to get the most showings and applications. Again, the more applications you have to choose from the better chance you will find the perfect tenants.
3. Put your rental requirements in your rental posting. For us, we don’t rent to anyone with under a 600 credit score, violent criminal record or previous eviction, foreclosure or bankruptcy. We tell the potential tenants up front so that neither of us wastes time or effort.
4. Actually Screen Your Tenants. This one is a no-brainer. If you take anything away from this article, remember this: Do the screening! Relying solely on your gut feeling about people may work in other situations in life, but not this one. There are dozens of good tenant screening softwares out there, USE THEM. Make sure the tenant agrees to have their Credit, Criminal and Evictions reports pulled for screening. These will give you most of the information you need. I use the software linked to my Buildium account (our property management software), and it actually gives us a recommendation to Decline, Accept Conditionally or Accept the tenant.
5. Follow up with ALL references. On our tenant application, we have our potential tenants provide their employer and previous landlord. I STRONGLY recommend that you follow up with these references. You can get a very good feel for the tenant by talking to people who they have worked for and who have rented to them.
If you are not finding a qualified tenant quickly, don’t panic! Instead, consider lowering the rent closer to the market rate. Doing this first, instead of compromising to get someone in quickly, allows for a new group of potential tenants to be considered. Noticing a trend? I will say it again: The more people you have interested in a property, the better your chances are of finding highly qualified renter.
I have learned this lesson more than once. Scenario is this: You have had a property up for rent for a month, you’ve done 2 open houses and no applications. Finally you get 1 application, and the tenant is lower than what you would normally accept. Instead of lowering the rent and waiting for a better application, you rent to them anyway because they are the only ones who applied and you don’t want to waste any more time. This is the WRONG move! If you lower the rent to closer match surrounding rentals, you will get a stronger quality of tenant. Be patient, not greedy.
1. Splurge on the professional pictures.
2. Post your property on as many websites as you can.
3. Include the rental requirements in the post.
4. Screen potential tenants. All of them.
5. Follow up with all references.
6. Don’t react; respond and be patient.
Keep in mind…
The more people you have interested in a property, the better your chances are of finding a highly qualified renter.
Overall, just do your due diligence and plan for the worst case scenario. These are just a few tips for finding and placing the best tenants. What guidelines do you stick to when screening potential tenants?