How To Find A Great Tenant For Your Rental Property

How to Find a Great Tenant for Your Rental Property

  • Post category:News

The success of a rental property depends equally on tenants that are compatible with the landlord or property owner’s requisites. Simply put, attracting a good tenant for your rental property is essential. However, countless landlords make the mistake of waiting until the very last minute to fill a vacancy. Even if there is a high demand, finding the right tenant is not a quick process. The sooner a person starts to promote a property, the better the options are and the higher likelihood of finding quality tenants.

Fundamentals of Finding the Best Tenant for Your Rental Property

So, how does one go about finding the dream tenant for your rental property? Well, it sadly does not happen overnight. There is no magic word that can instantly land us with the tenant our dreams are made of. Finding the right tenant does require a bit of diligence on our part as landlords. Whether we find renters ourselves or hire a property management firm to do it for us, the fundamentals will still be the same. And as landlords, it pays to know what they are.

Use a Funnel Technique

Doing as online marketers do is a good way to find premium tenants. Just like in any business sales funnel, the goal is to generate a lot of leads even with the knowledge that only a small portion of those leads could turn to conversions or sales. 

Let us take, for example, an ad online for a pair of winter gloves. There is a big chance that out of all the thousands who may have seen the ad, only a handful will actually buy a pair. That is how a sales funnel works, and it can be utilized in various industries, including the property rental industry. 

As a property landlord, utilizing the same funnel technique to attract tenants is your job. Think of it this way: if only a single person calls to inquire about the rental property, the odds that this person is going to be a great tenant is split 50-50. It’s quite a gamble. However, if we have numerous people communicate interest in the property, then the odds are no longer stacked against us. In fact, there is a bigger chance of finding one that’s going to be close to our ideal or dream tenant.

The bottom line is that the more individuals we attract at the top of our funnels, the more we can be selective in finding just the right tenant. So, how do we achieve this? Advertising is the best way for us to reel in the best leads. 

Here, we can use Zillow, Craigslist, Facebook, Postlets, a newspaper ad, a good, old-fashioned sign on the yard, or everything all at once. Who says we can’t utilize all marketing channels anyway? The more we market ourselves, the more we open up to greater opportunities. It’s no longer a needle in a haystack scenario. Once we start getting leads, we can now weed through them and single out the good from the bad.

Setting High Monthly Standards

These standards act as our minimum requirements that clearly define who we are looking to rent our property to and who we are not interested in. These lists of standards must be clearly written on our websites and marketing materials and be verbally expressed to all prospective tenants inquiring about the property. 

Our standards aren’t complicated, and they are as follows:

  1. The tenant should earn three times or more than the set monthly rental, and this must be proven through documentable income sources. 
  2. Second, the tenant should not have any prior evictions under his or her name. 
  3. The tenant must not have any felonies.
  4. A credit score of 600 or higher is required.
  5. And last but not the least, excellent references from previous landlords are a must.

Tenants who do not meet these fundamental requirements are unlikely to find rentals with us. There are two main benefits of having these carefully defined rental standards. First, it immediately discourages potential time-wasters from even sending us a communication. Next, it allows us to objectively view each candidate rather than be emotionally influenced by their sordid backstory. 

While there’s a possibility that they could work out just fine if we took the time to interview them, there’s also the chance that they won’t. So, let’s not waste each other’s time. If other landlords want to take the risk, then they are welcome to do so. We, however, would rather quickly pass on the gamble.

Screen Like Your Life Depends On It

We know that it sounds rather dramatic, but really our lives do depend on it. Screening a tenant is just not an afterthought. We don’t just tick off several boxes and call it a day. It may not seem like it, but screening is the most important of all the steps in the entire rental process. So, we make it a point to give it all the attention it deserves. 

When we screen, we verify that the potential tenant is able to meet all our minimum standards. It is also a way to check if all the documents that have been provided are legitimate. Because let’s face it, there are many dishonest people out there who are attempting to hoodwink those who aren’t careful. 
As landlords, it is our job to verify every single thing. To give landlords a brief overview, here are some easy steps on how to screen a tenant for your rental property:

  • Phone their place of employment. Verify if the person does in fact earn as much as they claim they do, which according to our minimum standards should be three times the rental rate.
  • Make a call to the person’s past landlords to inquire if the person has in fact been a good tenant. As logic would dictate, the kind of tenant they were in the past is likely the kind of tenant they will be when they rent with you.
  • The biggest mistake a landlord could ever make is to not check on the prospective tenant’s background. We aren’t asking you to dig up their school records or their family tree. Rather, run a background and credit check. 
    • There are numerous ways you can do this. or are some resources we as landlords can use to our advantage. Check the reports and look at past evictions, felonies, and other indicators that would signify if the person is a troublemaker or not. 
      • One important point to remember however is to always review local state and federal fair housing laws to ensure that none of the steps are illegal or discriminatory in any way. Otherwise, the penalties for these infractions can be severe.

If the prospective tenant for your rental property ticks all the boxes, then you can confidently sign the lease and have them move in. Note, however, that the quest for finding the perfect tenant does not end there.

Effectively Train and Manage

Training our tenants to be world-class is crucial. We want a tenant who can take care of our property while helping us grow passive income. The thing is, most tenants want to be an ideal one; they just do not know how to be one. As landlords, it’s our job to point them in the right direction. 

Make sure you have rules established and let those rules be known. Make sure your tenants understand the consequences if those rules are violated. Follow through and instill the consequences should they not follow the guidelines you have set. 

For instance, the renter must know how much the rent is, where to pay it, and what happens if they fail to make a payment or if they end up paying late. Never be lenient with late fees even if you feel like you should “just this one time.”

To Conclude

At the end of the day, the screening process of a tenant for your rental property is one of the most important aspects. But before you can get there, you must also implement key strategies that can help you land amazing leads or prospective tenants. And as mentioned, doing your end of the deal as the landlord ensures that your tenant is satisfied with the setup. With enough patience and resilience, any landlord can find a great tenant on their own or with the assistance of a reputable property management firm.

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