I’ve been a landlord for over 20 years; my experience ranges from the renting of single family homes to large complexes with many units. The unit will often dictate the kind of tenant appropriate for the property. For example, a 1600 square foot detached home is most likely going to attract a family, whereas a studio will attract a single person.
The media is promoting a buyer’s market for real estate and the consumer of rental property believes that translates to a buyer’s rental market as well. Renters are looking for the best value. Here are a few things that will help attract good tenants and command higher rents.
Differentiate Your Property: Look at the neighborhood and then go one step better.
- Convert on/off light switches to dimmer switches, this will create ambiance very inexpensively.
- Paint. We paint our units a soft tan and the ceiling and trim a bright white. It creates a custom look while still being neutral. It doesn’t cost any more but does take a little extra time.
- Install a curved shower rod to enlarge the tub and shower space.
- Add a built-in Microwave to the kitchen.
- Depending on the unit and your budget, a TV installed over the fireplace will really create that wow factor.
First Impressions are Critical: Make sure the unit is ready to rent and show before you advertise. Use photos when listing the property for rent. Also, don’t forget about the common areas; make sure they are clean and the landscaping is well maintained.
Once the property is ready, then the goal is to find a pool of good tenants. Proper screening is very important in finding the right tenant for a unit. It’s important to follow the Fair Housing Guidelines to avoid discrimination.
As a landlord, the first thing you should do is create a “Rental Criteria” List. This will make the evaluation process much easier. Your criteria should address issues such as: Bankruptcies, eviction filings, positive reference(s) from prior landlord(s), and a sufficient income ratio.
Make sure the application is current and addresses all your criteria. The application must be completely filled out, legible, signed and dated. Review the application line by line with the applicant present, if possible. You will also need to obtain documentation to verify identity, employment and income of the applicant(s).
To verify employment, I suggest doing the following:
Call the employer, but don’t use the number provided by the applicant. Find the number yourself using an internet search. When you call, are you greeted with the company name? If so, ask to speak with the HR department or individual that handles employee verification. Once you have a person from HR, make sure to document their name and ask them to verify the following:
- Is the applicant currently employed at this company
- What was their date of employment
- Employment status (full-time, part-time, seasonal or temporary)
- Does the SSN number match
- Current salary
The HR department will most likely ask for written permission from the applicant before they supply this information.
Verify Identity: Take a copy of the photo I.D. Compare the picture with the applicant. Also, check the signature and the date of birth. If the address on the ID is not listed on the application, ask why.
Here are some Red Flags that indicate an application might be fraudulent:
- No photo ID
- Social Security Number discrepancy
- Incomplete rental application
- Unable to provide original documents
- Inconsistent address history
Your application should request permission to run a credit check on the applicant. You must have permission in writing under the Fair Credit Reporting Act (FCRA). A credit report contains a goldmine of information. Things to look for:
- Bills paid late
- Financially overextended
- Tax liens and bankruptcy filings
- Other credit inquiries
- Length of credit history
I suggest that instead of rejecting applicants, you just choose the applicant you wish to have as a tenant. I know it sounds strange, but if you reject an applicant, you have a responsibility under the FCRA to provide the applicant with:
- A written notice
- The name, address and toll-free number of the consumer reporting agency who provided the report
- Notice of the right to obtain a free copy of their report
- Notice of the right to dispute with the reporting agency
These are some simple guidelines that can help you find good, long-term tenants.
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- Diana Hill email@example.com