Your experience as a real estate investor and a landlord will largely depend on the tenants you place in your rental property. Therefore, it’s crucial that you choose the best possible tenant for your home. You also want to minimize vacancy, which is one of the most expensive costs property investors face. So, the goal with tenant placement is to find a high-quality tenant quickly, and to do everything you can to retain those residents.
Tenant Placement Marketing and Property Preparation
Tenant placement actually starts with your property and its condition. In order to attract excellent tenants, you have to provide an excellent home. Make any necessary and inexpensive upgrades and updates to your home so that good tenants notice and want to live there. Cast a wide net when you market the property. Most tenants are looking for their next home online, so you’ll need to have your listing on all the popular rental sites. Take professional photos that really show off what your home has to offer. Make sure it’s functional, clean, and attractive before you begin showings.
Tenant Screening: Background and References
Your screening process must start with a set of tenant criteria and an application, which all residents age 18 and over must fill out and sign. Your criteria should state what you are looking for and why an application may be denied. First, run a nationwide background check and get a criminal history. You’ll also want to call current and former landlords or property managers. Make sure you’re talking to the person who actually rented a property to the tenant. Find out if rent was paid on time, the property was kept in good condition, and the lease was faithfully followed.
Tenant Screening: Credit and Finances
Run a credit report and look specifically for red flags such as debts owed to former landlords or utility companies. Check for past evictions and judgments. Make sure they are employed where they say they are employed, and ensure they earn enough income to pay the rent. You can ask for verification and documentation such as pay stubs, bank statements, and tax forms.
You probably won’t find someone with perfect credit. However, you want to make sure your tenants have been responsible with their housing payments in the past.
Tenant Placement: Signing the Lease
Once you have screened and approved a tenant, you can collect the security deposit and other move-in funds, which may include a pet fee and the first month’s rent. Go over the lease with your tenants and answer any questions. Both parties need to sign it, and then you can relax knowing you have a good tenant in place.
Leasing a property can get complicated, and if you have any questions, please don’t hesitate to contact us at Decas Group. We’d be happy to tell you more.