Tenants are at the heart of your job as a landlord. Without tenants, you’re basically just throwing money away on an expensive, empty property. The problem is that far too many landlords tend to avoid thinking about their tenants too much. For a lot of landlords, they think of their tenants as little more than the source of the rent that comes in every month. The issue with this is that it can end up leaving you stuck with the wrong kind of tenant. Tenants can be the difference between a simple life as a landlord or making your life a living hell. If you end up with the wrong tenants, you could end up spending so much time and money dealing with them that it’s no longer actually worth it. With that in mind, here’s the ultimate guide to picking the right tenants for your property.
Check their finances
It’s shocking just how many landlords neglect this incredibly obvious step. Before you do anything else, you need to verify the income of any prospective tenants. The number one, most important thing to consider is whether or not a tenant can actually afford to rent the property. Ideally, their income should be three times the monthly rent. If their income seems like it only just reaches that point, then make sure that they have a guarantor to help make sure that you don’t end up out of pocket. You should also check their credit rating as well. If the tenant has large amounts of debt, that’s going to have a big impact on their ability to pay the rent, regardless of their income.
Are they right for the property?
It might seem odd to say, but the kind of property that you’re renting out will have an effect on the type of tenant that you want to attract. If you’re renting out some brand new apartments then you need to consider who it is that you want to live in them. Older couples tend to be more reliable regarding the care of a property, but if they are located in a more vibrant, high energy area, then they may end up becoming unhappy and vacating the property sooner than you would like. By contrast, young people are more likely to be happy in an area with more noise and nightlife but are less likely to take care of the property.
Check their rental history
Let’s say that you think you’ve found the perfect tenant. You’ve spoken to them; they seem ideal, and their income is more than enough to cover the rent. Before you sign any contracts, then make sure you do a very thorough heck of their rental history. The last thing you want is to find out that they have a history of avoiding rental payments or that the reason for their previous move was that they were evicted by their previous landlord because of their behaviour. People might seem like they’ll make simple and low maintenance tenants but it’s always worth double checking so that you don’t get burned.