SMARTERLANDLORDING

ADVICE FROM EXPERIENCE

Tenant Screening

Rental Standards

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Once you have gotten past that first phone call from a prospective tenant, you need to then think about how you will determine whether or not that person will make an acceptable tenant.  To make that determination, you need rental standards that measure a potential tenant’s qualifications.  What are some rental standards that a smarter landlord should and should not use?

Landlords Have Got to Have Their Standards, But…

There are some standards that you cannot and should not use.  Using them can get you in a lot of hot water.  Avoid using any sort of rental standards that are based upon a person’s physical or cultural characteristics.  Using such standards is wrong and often illegal.

What are these types of standards?   Standards that are based upon a person’s race, sex, religion, national origin, children, marital status, sexual orientation and disability are a few.  The fact that someone is black, or female, or unmarried or has three kids does not have any bearing on that person’s ability to be a good tenant.  Therefore rental standards that are based upon such criteria just do not make good policy and can end up costing you expensive fines and legal fees.

Rental Standards to Use

Landlords need to focus their rental standards on criteria that will actually affect their landlording business.  Such standards that do not limit your applicant base and reflect a person’s ability to pay, stay and respect your property.  These standards are not set in stone, and can be tweaked and refined to reflect your business and market conditions.  Here are some suggestions.

Income

If a potential tenant does not make any money, how are they going to pay you rent?  Going further, it is not just about making money, but about making enough money to afford your property.  The thing to understand is that people not only need housing, but that they also need to eat, stay warm and have a bit of fun.  All of that costs money.  You as a landlord do not want a tenant that has to make a decision between food and rent.  So you need to verify that they have enough income to afford both your rent and other necessities.  It does not matter where their income comes from (unless it is from an illegal source), just that they have it.  Making two to three times the amount of your rent is often a good standard to use.  For example, if your rent is $1,000 per month, your rental standard might be a gross income of $2,000 to $3,000 per month.

Rental History

Does your potential tenant have a rental history? If so, what does it show?  Did they pay their rent in full and on time?  How often were they late with payments?  Do they move every year or do they tend to stay put for a while?  We like to see stability and promptness.  Of course what exactly “stability and promptness” means to you will vary depending on your market and business style.  A college town may tend to have a lot of turnover and thus such a standard will be different from mine.  Something along the lines of one late payment every two years and not moving every year may work for you.

Evictions

This is an item you absolutely must check.  Has the person applying ever been evicted?  A recent eviction is often a standard for immediate disqualification.  But an older one with a demonstrated and improving rental history can be different.  Again the exact standard will vary depending on your business and market.

Criminal History

Violent offenders are out.  If an applicant has been in jail for a violent offense, then the answer from us is no thanks.  Not all criminal convictions are the same however and you may not want to give them all equal weight.  Does possession of a few joints equal spousal abuse?  It is up to you.  You can come up with your own standards here as again they will vary depending on the market you serve.

Attitude and Appearance

Attitude means a lot.  Being rude and disrespectful often means instant disqualification.  If they are going to be rude to you now, imagine what they will be like once they move in.  Again, no thanks.  Appearance counts as well.  A car filled with trash or people with food spilled all over them are major red flags.  That filth will move in with them and eventually become your problem.  Define standards regarding rudeness, lateness and cleanliness.

Advice From Experience

The above is not an exhaustive list.  You as the landlord can add additional standards, such as work history, as you see fit.  The key again is to use standards that will demonstrate the ability of a potential tenant to pay, stay and respect your property.  Whatever rental standards you decide to use, write them down and keep them handy.  Every once in a while someone from the government may want to see them.  You will need to be able to show them.  Want more great advice like this?  Order the book, Advice From Experience today!

What rental standards have you used?  Please share with your comments.

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Four Questions For That First Call

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Congrats!  People are calling to rent your property.  You have advertised well.  Now the hard part begins, selecting a tenant.  The first phone call from a potential tenant can be awkward for some, but we landlords need to remember that it is a very important call.  It can save us a lot of hassle.  How?  Simply by using these four questions for that first call.

When Are You Looking To Move?

This question can be a real time saver for you.  Believe it or not, some folks begin looking for a new place 4, 5 even 6 months before their current lease expires. Sure, they could have a good reason such a hot market or a job transfer, but they often also expect you to hold that unit for them until, for free!  Are you willing to lose 3 or 4 months worth of rent?  I’m not either so we often ask them to check back closer to their move date.

What Is Your Income?

You should get this question out of the way early on.  If a prospective tenant cannot afford your unit, than both of you are wasting your time.  There are many ways to ask this question.  Perhaps the best way is something along these lines.  “That unit rents for $1,000 per month.  We require income to be three times the monthly rent.  Is that within your income range?”

How Long Have You Been At Your Current Job?

The goal of every landlord must be finding tenants who pay, stay and respect your property.  When asking about work history, you are asking about their stability.  Will they stay?  Ideally, you would like someone who has been at their current job for several years.  Be cautious about someone who job hops a lot.  They may just hop out of your place as soon as they can.

How Long Have You Been At Your Current Residence?

Again, the goal here is stability.  The last thing you want as a landlord is lots of tenant turnover.  Tenant turnover is a cash flow killer.  Ask your first time caller how long they have lived at their current residence.  Then ask how long they lived at their previous residence.  If you keep getting answers of a year or less gently let them know that you cannot do business with them as they seem to move too much.  Trust me; the likelihood that they leave you behind in a year is very high.

So there you have it.  Four questions to ask on that first phone call.  A final word of caution is necessary however.  To avoid appearing discriminatory, ask everyone who calls, the same questions, all the time, every time.  There are fair housing testers out there and you just never know who is on the other end of the line.  To avoid any issues, be consistent with your questions.

What do you like to ask first time callers?  Please share with a comment.

 

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The Qualities of the Best Tenants

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A good tenant is worth their weight in gold.  Finding them is one of the keys to a successful landlording business.  As landlords, we must strive to find people who will pay, stay and respect our properties.  Doing so is mostly done with tenant screening and background checks.  But finding the best tenant goes deeper than screening.  Smarter landlords have learned what the qualities of the best tenants are and to look for them.

What are these “best tenant” qualities?

The first quality landlords should seek out is stability.  Tenant turnover is a cash flow killer.  You want someone who is going to stay in your property for the long term.  Look for tenants that do not move every year and have held steady jobs.  People who move from place to place and from job to job may not have the qualities you are looking for.

A second quality is reliability.  You want tents that will do what they say they will do.  Have they paid their bills on time?  Have they kept a job?  Did they show up to their appointments with you on time?  Reliability can be hard to find in this world so if you do find this quality in a potential tenant, make an effort to get and retain them.

Third is politeness. Lots of people can look good on the reports you get back from your screening service, but how do they act in person?  What is their demeanor?  How do they treat you or your staff?  Were they rude or considerate, loud or even toned?  Whatever they are, if you let them move in it is something you will have to deal with.  Try your best to get a good feel for a potential tenant’s personality as you interact with them and then think about that person on the phone asking you for a repair.  Shy and quiet is one thing, demanding and disrespectful is another.

A final quality is thoughtfulness.  I am not so much speaking of a prospective tenant’s attitude, rather, have they put some thought into where they want to live?  Someone who puts some active thought into where they want to live, checks out the market, and does their own screening process on potential landlords is likely to make for a better tenant than one who does not.  Think about it.  Would you rather have a tenant who looked around and choose your place or someone who said that “this will do?”

We landlords can often get a good read on potential tenants as we interact with them through the application and screening process.  Looking for the above qualities will help you make a good decision and avoid many dreaded tenant problems.  This may take a bit of practice on your part, but it is something that must be done.

What are the best qualities do you think are the best to look for in a tenant?  Please let me know with your comments.

4 Discriminatory Questions That Can Trip Landlords Up

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Most people are aware of fair housing laws.  These laws make it illegal for a landlord to discriminate on the basis of race, age, sex, familial status, national origin, color and religion.  State and local laws can often add disability, veteran status, sexual orientation, income source and other items to that list.  Every landlord I know tries their best not to run afoul of these laws.  They know that it is both wrong to discriminate in such a manner and that it could land them in a deep and expensive pot of hot water.

But, even if you are aware that these laws exist and have no intention of acting in a discriminatory manner, it can still be easy to trip up.  How?   By asking questions that they think are perfectly innocuous but can be taken as discriminatory.

As landlords, one of the most vital things we do is screen potential tenants.  To screen tenants properly, we need to get certain pieces of information.  How we ask for that information however is what gets us into potential hot water.

Here are four questions that landlords often ask which can be taken as discriminatory.

  1. How old are you? – As landlords we want to make sure potential tenants are old enough to sign a legal contract and we want to run credit and criminal checks on everyone over 18 years of age. How can you find that out without asking their age?  Well, you do not really need to know their age, just if they are legal adults so ask this question instead.  Are you a legal adult?
  2. Do you have any children? – A seemingly innocent question that can get a landlord into deep dodo. Remember that familial status is a protected class and if you ask about children you run the risk of running afoul of the law.  Instead you should ask this question.  How many people will be living with you?  You can then take this a bit further and ask how many will be legal adults.
  3. What size apartment are you looking for? – How could you get in trouble for asking this? After all you were just trying to be helpful.  But, by asking about size someone might think you are trying to dissuade people with large families.  Thus putting you on the wrong side of the familial status protected category.  Instead ask what a potential tenant’s price range is then let them know what you have available in that range, no matter the size.  In that way you let the potential tenant make the decision.
  4. Do you have a job? More and more communities are banning discrimination based on the type of income someone receives.  To avoid problems ask this question instead.  How much is your monthly income?  After all, what we really want to know is if a potential tenant can pay the rent.  Who cares where the income comes from as long as it can be verified.

When screening potential tenants do you best to keep your questions general.  Base your questions on items that matter such as verifiable income, and age of consent.  By keeping things general, especially at the first points of contact, you can hopefully avoid tripping over some of those housing discrimination laws.

The Professional Tenant

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Your first thoughts when reading the title of this article might have been positive.  You might have thought that a professional tenant would be something landlords strive for.  They are not.   A professional tenant is someone that I hope you never come into contact with.

What Is A Professional Tenant?

A professional tenant is a landlord’s worst nightmare.  They are people who prey on unsuspecting landlords and suck the life out of them.  Professional tenants do this with a slick presentation and smooth talking.  They know all of the right words to say and exactly what you want to hear. They know exactly how to act and have an answer for every question.

Being polite is part of the scam.  So is dressing well and showing up to appointments on time.  Their goal is to dupe you into thinking that you have just found the best tenant ever, when nothing could be further from the truth.

The smooth talking and slick presentation is often followed by cash in hand.  They hold the deposit and first month’s rent and have it in their hand, ready to give it to you.  No need for you to do anything further.  Why wait?  It can all be pretty tempting.  Little do you know that the money they have in hand is likely owed to their current landlord.

Professional tenants will say and do anything and everything to gain entry to your property.  They hope that you will let your guard down.  They want you to let them move in and take possession.  But they have no intent of ever paying you another dime.  Once they are in, you may never hear from them again.

Professional tenants also know how the system works.  They know it takes time to file an eviction and work through the process, because they have been there before.  They also know all of the tricks they can try to delay that eviction; from continuances to bankruptcy filings.  They know that they will eventually get kicked out in six months or a year (or more in some states), but that was their plan all along.  They wanted to pay you to move in, skip the rest and then leave in the middle of the night to prey on another unsuspecting landlord.

Appearances Are Deceiving

Every professional tenant I have run across, and I have run across a few, looks and plays the part well.  On the surface, you really cannot tell they are trying to deceive you.  They are skilled actors.  Their one tell is perhaps their effort to make you feel that they have to move today, that the “good deal” they are offering you will be gone if you do not act.  This is their intent, they want you to act quickly and let down your defenses.

Defending Against The Professional Tenant

Your first defense is how you advertise.  Professional tenants look for small “mom and pop” operations.  They know the big property managers are not going to fall for their ruse.  Generic “For Rent” signs are often a major calling sign for the professional tenant.  No company policy there they believe.  Professional looking signage with a company name and logo are a great first line of defense.  Professional tenants want to avoid professional landlords.

The next best defense is to not be tempted by the cash in hand and the deal that will supposedly get away.  Always tell every potential tenant that you require an application and a background check.  That will scare most of them off.

But it will not scare all of them away.  Some will go through your application process, hoping you are just going to pocket the fee and forgo the actual background check.  Never do this, do the background check!  Because like I said, sometimes you just cannot ever really tell and they work hard to deceive you.

He Spoke Well

As landlords, we have to be aware that there are professional tenants out there looking to scam us.  Protect yourself on the front end and never forgo your application process and background check.   I once had what I thought was going to be the perfect tenant.  He spoke well and dressed well.  He was ready to move in.  When I checked however, everyone including the phone company was looking for him.  He had not paid a single bill in months as far as I could tell.

I feel sorry for the sucker that eventually rented to him.  But, I am sure glad it was not me.

Do you have a professional tenant story?  Share it with your comments.

Kevin Perk is the founder and publisher of Smarterlandlording.com.  He is the author of Advice From Experience To New Real Estate Investors.  Contact Kevin here.

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How Do You Know You Picked The Right Tenant?

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Blogger’s Note – The son of a good friend of mine is looking to get started in real estate investing.  He would like to become a landlord and find properties that offer positive cashflow to replace his current income.  His goal is to ultimately become a full time real estate investor.  I have been giving him some advice as he tries to liftoff his real estate investing and I thought it would be interesting to share some of his questions and my answers on this blog as I’m sure there are others out there who have the same questions.  I hope to publish more questions and answers in the future.  Click here to see the previous question and answer:  Is my market a good place to start?

Question:  How Do You Know You Have Picked The Right Tenant?

Answer:  You Will Not.  But Proper Tenant Screening Will Tip The Scales In Your Favor.

The simple answer is that you really never know if you have picked the right tenant until they move in have lived in your property for a while.  Until you have a track record of on-time rental payments and a lack of complaints or unnecessary repairs, you never really can know.

That said, you can tip the scales in favor of you picking the right tenant with proper tenant screening.

What Is Proper Tenant Screening?

Proper tenant screening is made up of a lot of different ingredients.    These ingredients are going to vary based upon the landlord, the type of property, the local market and local laws.

Proper tenant screening is also perhaps the most important thing landlords do because bad tenants are extremely costly in terms of money, time and stress.  So you want to avoid them.  Instead you want to attract and screen for tenants who will pay, stay and respect your property.

To begin thinking about how you might properly screen your potential tenants you should first do two things.

  1. Learn about federal, state and local fair housing laws.
  2. Develop a set of rental qualification criteria that you will use to screen and choose potential tenants.

Fair Housing Laws

Federal legislation from the 1960s onward has designated several protected classes.  You may not use these classes in any way as a basis for tenant selection.  These federally protected classes are: race, color, religion, national origin, sex, disability and familial status.  States and local jurisdictions may add more classes, such as age, veteran status or sexual orientation, to the list.  Check your local laws to be sure.

You may not deny housing to someone because they are black or from India for example.  You cannot deny someone housing because they have children or are unmarried.  In fact, you cannot even ask about these items.  Why?  Because being black or unmarried or from India has no bearing on someone’s ability to pay, stay and respect your property.

Rental Qualification Criteria

There are however many other types of measures available for you to use that do reflect a potential tenant’s ability to pay, stay and respect your property.  These measures are what you should use to develop your rental qualification criteria that I mentioned in point two above.

What types of measures might these be?  Here are just a few examples.

  • Tenant must have income equal to three times the amount of monthly rent.
  • No evictions in the past 5 years.
  • A credit score above 600.
  • No felonies in the past 10 years.
  • Not moving every year.
  • Not being rude or disrespectful.
  • Being truthful.
  • Being neat and clean.

There are many more that you may choose to utilize.  This is because these few rental criteria examples that I mention may or may not work in your local market or for you.  You may want to have tenants who have never been evicted for example.  Credit scores may not be good indicators in certain areas.  In others, like those near military bases, people may move all of the time.

Remember too that liars, jerks and slobs are not protected classes.  You do not (and should not) have to rent to someone who has provided false information on your rental application.  You do not have to rent to someone whose car is full of trash or has food spilled down the front of their shirt (guess where all of that trash will end up).  Nor do you have to rent to anyone who is rude or disrespectful to you.

You do however need to write your rental qualification criteria down, keep that written list in a handy to find file and use them to rank each and every potential applicant in the exact same manner.  If, for example, one of your criteria is a credit score above 600, you cannot break that rule “just this one time for this one person.”  The criteria must be applied consistently.

There is a lot more to tenant screening than I can write here in this short post and I am actually developing a lot more future material about this topic.  For now, use the above advice as a start and download my report on 22 Tenant Screening Red Flags by entering your e-mail address in the link directly below this post.

What criteria do you use to screen your tenants?  What works and does not work in your local market?  Please share with your comments.

 

The SmarterLandlording Podcast – Buying, Rehabbing and Managing Class D Apartments

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“The real estate is easy, the people are hard.”

Check out the SmarterLandlording Channel on iTunes

Stuff We Mentioned

Memphis Investors Group – The Memphis Investors Group (MIG) is the local REIA club here in Memphis.  If you are here in Memphis, look us up.  If not, check for a club in your area.

Multi-Family Investors Sub-Group – This MIG sub-group meets at noon every third Wednesday at Newby’s on the Highland Strip right here in Memphis, TN.   It’s free to go but lunch is Dutch treat.

Section 8 – Section 8 is a low income rental subsidy program that many investors in class D properties use.  Check out the Smarterlandlording Podcast with the Section 8 Landlord to learn more.

Like the Intro Music?  Check out my good friends in the band Kitchens and Bathrooms (Kind of fits right!).  They write and play some awesome, original music from right here in Memphis, TN.

Use For Rent Signs To Find The Best Tenants

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I’ll bet that a lot of you, like me, gave up using “For Rent” signs a long time ago.  These signs were once the way to go and a major way to attract the attention of people looking for a place to live.  Signs however also attracted a lot of unwanted attention, mostly in the form of phone calls.  The calls from those who were just looking or who could never qualify were a huge time waster and distraction.

Because of this unwanted attention and the explosion of digital advertising over the past few years, our “For Rent” signs have been confined to the storage shed.  I thought for sure that the use of these signs would eventually be a thing of the past.  That is until I talked to a colleague the other day.  He uses “For Rent” signs to find the best tenants almost exclusively.   He has great success without all of the phone calls.

Why Is He Still Using Signs?

My colleague still uses signs because he understands that tenant turnover is a cashflow killer.  Thus, he seeks tenants for the long term.  Tenants who really want to live in that particular neighborhood.  Tenants who perhaps want their kids to go to the neighborhood school or maybe have family in the area.

To him, there is no better way to find these folks than to attract the people specifically driving around the neighborhood looking for a place to live.  Think about it.  He has in effect begun to screen his potential tenants just with his method of advertising.  First, they must be somewhat serious about a place to live or they would not be looking around.  Second, they already know the neighborhood and are thus likely familiar with the rental characteristics of that neighborhood.  Finally, they can’t find his property in any other way than by driving around and looking where they want to live.

What About The Phone Calls?

What about all of the phone calls and the wasted time dealing with them?

He has a strategy for those as well.

He does not put any contact information on his signs.  Instead, he points folks to a flyer located by the front door of the property.  That flyer, taped behind the glass of a window so it cannot be removed, contains his contact information along with the three things everyone wants to know; the rent, the number of bedrooms and number of baths.

This strategy stops nearly all of those unwanted calls and it furthers his tenant screening process.  Again, think about what he is making people do.  The prospective tenant first has to drive and find the property, then stop and get out of the car, walk up and get the information and determine if the property is right for them.  If, after doing all of that they still make a phone call then they must really want to live there and think the property will fit their needs.

Brilliant!

Once he gets that phone call, he knows that he likely has a very good prospect on his hands that will not waste his time.

Will this strategy work everywhere for every property?  Maybe not.   But the strategy comes with years of experience and lots of trial and error behind it.  It works for him and it might just work for you too.  That is why I share it.

Sometimes, even with all of the modern technology we have, the old techniques can still work the best.  Perhaps I should think about dusting off those “For Rent” signs in the shed.

How do you advertise these days and why?  Have any unique or interesting techniques that work for you? Please share with your comments.

Tenant Screening Begins Immediately

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Tenant screening is one of the most most important things a landlord does.  Carefully screening out the potentially bad tenants will save you countless dollars and countless headaches.  Tenant screening begins immediately, at the first point of contact.   You should begin to look for potential red flags with that first phone call, e-mail or text message you get.

One way to see potential red flags is to ask questions designed to make them wave.  One of these questions is something we ask everyone almost immediately.  It is designed to save both ourselves and the potential tenant time and hassle.  That question is:

“When are you looking to move?”

There are three types of answer you can get to that question.  One of them is what you want to hear.  While the other two should cause you concern and get you to dig into their background a little more deeply.  Let’s go over those two first.

The First Answer You Do Not Want To Hear

The first type of answer has to do with immediacy.  If the answer to the question of when are you looking to move is something along the lines of:  “I have got to move tomorrow,” or “I need to move next week,” then you need to tread carefully.  These answers are a big red flag.  Why does someone need to move so quickly?

The most likely answer is that they are being evicted and they are finally staring at the reality that a hard day is right around the corner.  You are probably not going to want someone in this position moving into one of your properties.  The poor decision making skills are on full display here.

The best answer you can have to this immediacy type response is something like the following: “We have an extensive and thorough tenant screening process that will likely take several work days to complete.”  It’s the truth right?  Smarter landlords do have an extensive and thorough screening process.  Once your screening process is explained, most of these types of callers will likely move on.

The Second Answer You Do Not Want To Hear

The second answer you do not want to hear is the opposite of the first.  When asking when a prospective tenant needs to move, getting a long term type response such as  “Six months from now,” is a no go.  Are you really going to hold a vacant property for six months and lose out on six months of potential rent?  No, you are not.   So it is best not to waste anymore of either person’s time.

Let them know that you will be happy to hold the property for them during that time period provided they pay the monthly rental amount.  If someone wants to pay me rent and not live in one of my properties for a while I’ll most likely be happy to let them.  Most will not and will move on.  Don’t let this opportunity go to waste however, be sure to tell them to check back when they get a bit closer to their moving date, perhaps two months out.

The Answer You Want

By now it should be obvious what you want to hear.  The answer you want is: “I need to move in a month or two.”  Perfect.  This potential tenant is forward thinking and likely making good decisions.  Continue on with the conversation to see if you have found your next tenant.

Remember this as well. Always be kind and courteous to everyone you talk with. Treat everyone the same and ask the same questions. Be consistent.

What Other Questions Should You Ask?

You can learn more about what to ask and look for when screening potential tenants by subscribing and downloading my free report: SmarterLandlording’s 21 Tenant Screening Red Flags.

It’s easy.  Just enter your e-mail below.

7 Things Bad Landlords Don’t Do

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Being a landlord is a tough and varied job. It requires the wearing of many different hats. A landlord has to be an accountant, a contractor, a guidance counselor and much, much more in order to be successful. Most landlords do a pretty good job at juggling all of these responsibilities.

Unfortunately, there are a few bad landlords out that that make this already tough job even more difficult. These bad landlords get the courts involved in our business. They get code enforcement involved in our business. They get legislatures involved in our business. They get reporters to dish out a fair share of bad press about us. The term “slumlord” starts to get applied to all landlords, no matter how they run their business. They just generally make it harder for the rest of us because of their bad actions.

Over the years I have found that many bad landlords are not necessarily bad people. Instead they just do not understand or know how to run their landlord business. They fail to do several key things that all landlords must know or do in order to make things run smoothly.

So what are the things that bad landlords don’t do?

  1. Bad Landlords Don’t Screen Their Tenants – There are bad tenants out there that prey on these bad landlords. They smooth talk you into letting them rent your place. They flash a lot of cash upfront. They lie, lie and tell more lies. If you fall for the talk, the cash or the lies you are going to learn a hard lesson. You will likely spend thousands trying to evict them and they can turn a great property into a problem child in a matter of months. Proper screening is perhaps the most important thing a landlord can do to prevent a lot of the other problems we encounter.
  2. Bad Landlords Don’t Understand Cashflow – Cashflow is king in the rental property business. If you bet on anything else, like appreciation, you are setting yourself up for failure. If you are not bringing in enough cash to cover all of your expenses, the bills will creep up on you over time until it is just too much for you to handle and your property goes into a death spiral downward.
  3. Bad Landlords Don’t Fix Things – Not fixing things when they break often leads to a death spiral for a property. How? Something breaks, then tenants complain, things remain unrepaired, then tenants start to leave. This spiral does not happen overnight, but rather slowly. Good tenants are simply not going to put up with a lack of service and repairs. These landlords may think they are saving money. But in the long run they are shooting themselves in the foot.
  4. Bad Landlords Don’t Do Preventive Maintenance – Speaking of things breaking, some things will break if you do not do a little preventive maintenance. These landlords again think they are saving money, but they are not. Condensers simply need cleaning, filters need changing, walls need painting, etc, etc. I hate spending the money as well but I have come to learn that if I do not spend it now I will end up spending a lot more later on.
  5. Bad Landlords Don’t Have House Rules – House rules are a very important part of your lease (You are at least using a lease right?). House rules spell out when people should be quiet, when and how long guests can stay, where trash should be placed, if you can use candles (Nope!), and whatever else you feel you need to include to maintain a desirable property. We go over our house rules word for word with our tenants during the move in process to be sure they are understood. It shows tenants we care about our properties and it helps insure that there are no misunderstandings later on.
  6. Bad Landlords Don’t Train Their Tenants – No, I do not mean train like a dog on a leash. What I mean is if you do not set out the rules from the start and enforce them (see above), your tenants will learn to take advantage of you. So, you must train them early on that you are not one to be taken advantage of. If they are late on the rent, charge the late fee. Otherwise they will learn it is ok to be late. If there are complaints from other tenants, give a warning notice, quickly. Otherwise they will learn that their behavior will be tolerated and that it is useless to complain. You have to be very proactive with your tenants. The old saying is true, if you give some of them an inch, they will take a mile.
  7. Bad Landlords Don’t Keep Learning – Every day is a new day that brings new people and new experiences. You cannot just keep dealing with these new experiences the same old way. You have to keep learning and keep adapting your business or you will simply get left behind. This is one reason that I find my local REIA so important. The education and networking opportunities that are available just cannot be found anywhere else.

 

Don’t be a bad landlord. Do the seven items listed above. You will be amazed how much smoother your business, and your life, will be.

 

What else do you think bad landlords fail to do? Let me know what I left off my list with your comments.