Find Good Tenants

Finding high-quality tenants for a residential rental property you own or manage can be challenging as it requires patience and consumes significant time. Here are some tips.

Steps

Selling the virtues of the rental property

  1. Take some photos of the property, inside and out. The photos needn't be terrific quality, but they should be in focus, well-lit (day-time with natural light makes for much better photos than flash-lit) and give a good sense of the property and space. Use a decent-quality digital camera if you can; cell-phone cameras often lack the visual control and image quality you'll want. Take more photos than you think you'll need; some tenants may move from out of town, and providing a more complete view than other properties they're considering could tip the balance toward yours.
  2. Create a web page for your rental availability. Unlike most ads, a web page you control will give you unlimited space to describe the property, and (generally) the capability to post photos without limits in number or file size. You could, of course, buy a domain name for the property (about $10 per year) and build your own site, but a quick-and-dirty page on Google's Blogger.com, using one of Blogger's default design templates, does quite nicely. A good technique is to name the blog with the property address, which provides a URL like "123-main-street-ashburn-va.blogspot.com."
  3. Invest a little time on writing the copy for the site. Remember, you want to attract tenants with stable jobs and/or reliable incomes. That often correlates with higher levels of education and literacy. Put yourself in their shoes: other things equal, would you be more likely to look in to a property with well-written, clear and descriptive copy, or a slap-dash, poorly-organized paragraph with spelling, grammar and typographical errors galore? If writing isn't your thing, ask a friend to review and/or write the copy for you. Worse comes to worst, consider hiring a freelance writer to help. You might spend $50-100, but it's a non-recurring expense, and you can use the copy every time you have to advertise the property.
  4. Cast a wide net with your advertising. Advertise on at least a few free sites, like CraigsList.org and Lycos.com (but beware of the spam and scam attempts that inevitably ensue). But consider paying for ads, too. You're not selling a used toaster, or even a used guitar, here. You're trying to find a high-quality tenant to live in your house! Moreover, that tenant will be paying you $3.30 per day for every $100 in monthly rent you charge ($16+ per day for $500 per month, $33+ per day for $1000, etc.). If advertising on more than one pay-to-post classifieds site finds you a tenant even a couple of days sooner, your return on investment will have been well-worth the effort. Below are some alternative websites:
    • Roommates.com (if your space is a share)
    • Rentals.com
    • RentMarketer.com
    • RentBeep.com.

Screening tenants

  1. Screen tenants carefully. Be sure to do the following:
    • Pull credit reports
    • Verify employment or income.
    • Check rental references.
    • Scrutinize past problems carefully.
  2. Require that deposit and first month's rent be paid via cashier's checks.

Hiring a tenant finder service

  1. Call around to property management companies in your area and ask if they provide what is commonly referred to as a Tenant Finder Service.
  2. If so, ask what their fee for this service is and what the fee covers. Look for a service with a 100% tenant placement fee. As a landlord, you may love the fact that the service does all of the work outlined above.
    • Here's how it works: The landlord lets the service know when the unit is coming available. The service takes the photos, inside and out, does all of the advertising and hand shows each and every potential tenant the unit available through appointments. Once they are interested, the service collects the first month's rent and the deposit (made out in the owner's name) and runs their background check, credit check, employment verification and rental verification. If all comes back great, such a service may even go so far as to create a lease and e-send it to both parties for signature. The landlord will sign, the tenants sign and then all receive completed copies for his/her files. Such a service may even meet the tenant at the home on move-in day, to be sure all utilities have been transferred, provide them with a walk-through form they can give to the landlord 7 days after move-in.
  3. If you do use a tenant finder service, be sure they do not lock you in to anything. Your contract needs to be "non-exclusive", meaning that if you rent it (or a friend, etc.) before they do, then no fees are due. They simply assist you in renting your property. If there is no tenant brought to the table, then no payment is due.

Tips

  • Often, premium classifieds sites will limit your space for words, or the number of photos you can post. This is where your property page or blog comes in handy: put a link to the site in the ad, and you can overcome the limitations (assuming the site doesn't prevent you from putting in your own URLs, but most of the better sites won't).
  • Like finding great job candidates, finding great tenants takes some work, but when you think about the damage a bad tenant could do to your property (not to mention your peace of mind), you will probably agree it's worth the investment.

Warnings

  • Tenants gain many rights as soon as they take possession of the property. Evictions are slow and costly; most can be avoided by doing the work before the lease gets signed.

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Sources and Citations

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