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Finding and Screening Tenants for Your Rental Property

Todays Date: November 19, 2018

Picture this: that property you bought isn’t renting like you thought it would. You don’t really know anything about renting property, so you decided to rent it out to the first person who showed you some money. You didn’t check with their other landlords, or even follow through with a credit check. After all, most people are honest and what could possibly go wrong?

What could go wrong? This lovely new tenant could be unstable and pull a knife on her roommate. Yes – it happened to us at 3am on a Wednesday night several years ago. We had to call the police and have them separate the two tenants. The innocent roommate moved out the next morning and we were left with the knife wielding tenant who then stopped paying rent and refused to move out. It took us three months to evict her. We had to send a collection agency after her for the rent money. We never received a dime.

Now, of course, we are very picky when it comes to finding a good renter. We follow these 5 straightforward steps and they’ve never let us down:

– Step 1: Prepare the unit for showing

– Step 2: Get your paperwork in order

– Step 3: Research the market rents and place your ad

– Step 4: Show your space

– Step 5: Choose your new tenant.

Step 1: Prepare the property for viewing by prospective tenants

The better it looks the more likely you’ll find a good tenant for the space. Make it easy for someone to visualize themselves living happily in that space.

Easy fixes for your property include:

– repair any cracks or holes and apply a new coat of paint on all walls

– make sure all the little things like lights, appliances, doorknobs and sockets work the way they’re supposed to

– create a checklist to use when the tenant moves in and out. Inventory everything and their condition- doors, windows, drapes/blinds/shutters, plugs and light switches, shelving, appliances etc. from every room

– make sure the unit smells fresh. Open up the doors and windows to let fresh clean air in.

Step 2: Make sure you have your paperwork ready

Nothing inspires confidence and prevents headaches later like being a good landlord. And good landlords always have their paperwork in order. If you’re not sure that you do, you need to contact your government’s local residential housing branch. You could also go online to find the following forms:

– applications for tenants

– leases

– eviction notices and similar forms that you may need in the future. It’s best to have them right away so you don’t have to scramble to get them in the future if you really need them.

Each state or province has different requirements, so ensure you’ve got documents that are legal for your area.

Step 3: Research the rent rates and place your ad

Make sure the Price is Right!

Research similar units online to make sure you’re not asking too much for your unit. Its better to price just below the market. You will rent your unit faster, have a larger tenant base to pick from, and you will have a better chance of retaining a tenant for a longer period of time.

Get the word out! We’ve found tenants through all of these methods:

– e-mail all your friends and family and let them know about the property that you have that available to rent. They might know someone who knows someone who is looking for a new place to live

– use online advertising

– make a sign with a phone number and put it in the yard or in the window of the property

– local newspapers can be a fairly inexpensive way to advertise. Ask the classifieds agent what day is the best for advertising to ensure that you have the most eyeballs seeing your ad

– colleges or universities in the area; students are always looking for a place to live.

Step 4: How to show the space

Open houses are still the best way to show off your property. The best thing to do is decide on a two hour block during an evening or weekend, and then have a back up time for a second viewing (if you don’t find a good tenant after the first viewing). When someone wants to see it, you can tell them about the viewing times. This way you’re not spending all your time showing the unit.

When greeting tenants for open houses, be dressed “business casual” and have the tenant application forms ready.

Open houses are great, as they can create an atmosphere of demand. Knowing another person may want to rent the apartment makes others feel that they should want it too. Urge people to complete an application form before they leave so that you can write your impression about the prospective tenant right on their form.

Step 5: How to select your new tenant

– study applications carefully, looking for conflicting information or any kind of gaps in time pertaining to where the applicant was living

– always run a credit check. In this day and age it’s not enough for people just to have a good job or for you to have a good feeling about them. Verify it.

– reference checks. Call their references and ask simple questions like “How long have you known the applicant?”, “What’s your current relationship with them?” and “Would you rent to them again?”.

– listen to your gut. Do you have a good feeling about them? Despite everything else looking great for a tenant, you can usually trust your gut to indicate if you feel that something is wrong. If nothing feels wrong then you might have found your new tenant.

Once you are sure about your choice and you have deposited taken a rent cheque from your chosen tenant to the bank , make sure you let all the other possible tenants know that the unit is rented. If they ask why they weren’t chosen, never indicate that it was because of race, religion, age or social status- regardless of how you actually made your choice. It’s far better to say “the other tenant had a very strong application”.

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