The process to evict a tenant from your rental property may take three to four weeks and cost (on average) $3,500. As a landlord or property owner, this makes it clear you need to do your due diligence before choosing a tenant.
This is the best way to protect your investment. While this is true, you also want to ensure the rental unit doesn’t stay vacant too long, which could hinder your ability to make a profit.
Even though renting quickly seems like a good idea, it can cause time-consuming and costly issues down the road. The good news is there are some steps you can use to learn how to find good tenants.
Use the tips and information here to ensure you find the right tenants for your rental property. These tips can help, regardless of if you are renting a condo, apartment, or house.
Know and Follow the Law
As a landlord or property owner, you must treat all potential clients equally. The Federal Fair Housing Act is designed to prevent discrimination against specific classes of people regarding any housing you have available.
According to the law, you can’t discriminate based on:
- Family status (this means families with children)
- National origin
- Color or race
In addition to those factors, some states have more specific Fair Housing Rules. As a result, you need to make sure you are adhering to all of the local and federal laws that have been set.
Look at the Property and Neighborhood
To find a quality tenant, you need a great property. If the property is in good, damage-free condition, you may have an easier time finding more qualified tenants.
Making sure your rental property is in good shape can also help to set the standards for the condition the tenant is expected to leave the property when they move out. Also, by keeping the property in good repair, it shows the tenant they need to respect the property, too.
However, it’s also important to look at the income level in the neighborhood where your rental property is located. If you wind up over-improving your investment property to charge more rent, you could have a hard time finding a good tenant.
If you want to avoid a long-term vacancy, be sure your rental property meets the fair market rent standard for the specific location and what your property offers. Ultimately, keeping a clean curbside view, handling maintenance issues quickly and replacing any cosmetic or fixture issues can be equally effective, just like the larger improvements you may make.
Advertise the Property
Advertising the property is a crucial part of finding quality tenants. Today, it’s best to skip the flyers posted around town. Instead, stick to online advertising methods.
Today, online advertising is considered the industry standard. This is because it can reach a large number of potential renters, comes with a lower cost, and can reach more people.
There is a huge selection of websites where you can list your property. Some will cross advertise for you too. This exposes your rental ad to even more potential renters.
A great way to enhance your advertising efforts is to create a virtual video tour. This can be included in your advertisement.
In the tour, make sure you are pointing out the positive, along with the negative, aspects of the property. After all, you don’t want to waste your time or the time of a potential tenant by showing a property that isn’t right for their specific needs.
The more transparent you are with a possible tenant, the more qualified applicants you are going to receive.
An older but effective way to find reliable tenants is to ask family members, friends, and former tenants if they know someone who is looking for rental property. You may even want to offer a finder’s fee to help sweeten the deal.
If you offer an incentive, it’s going to help increase the likelihood they will help in your search for a quality tenant. It’s also a good idea to consider keeping an active list for future rental properties. This is going to help prevent you from taking on a subpar applicant just because you want to fill the vacancy quickly.
Create a Specific Rental Application
The fact that a rental application helps to screen possible tenants is a no-brainer. However, knowing what you should include in the application is often confusing.
If you don’t ask the right questions, you have no way to sort the possibly great tenants from the possible nightmares. Some of the things you should ask for include:
Make sure you ask two to three personal references. Specifically, make sure to ask for references that aren’t related to the tenant.
Also, don’t just look at this information. Make sure you call the references they include.
When you call, ask how long they have known the applicant, why the applicant said they were going to move, and other questions that may help you better understand the applicant.
Ask any tenant applying for the rental property to provide two years of their employment history. It’s fine if they don’t have much history in this area but seeing how often the person switches jobs can give you a good idea of if they are a reliable and stable tenant.
Past Rental History
Not all your applicants are going to have a past rental history to share. However, many tenants have lived in another rental house in the past. If that is the situation, make sure to ask for this information and contact their prior landlords.
Also, follow up with prior landlords. Ask about past rent payments, if they were on time, the condition of the house, and any other possible issues you should know. Quality tenants won’t have a problem with you speaking with their former landlords.
Look at the Tenants Credit
You want to try and find a tenant who is financially responsible. Do they pay their bills on time? If so, it’s a good sign they will pay their rent on time too, and they will be responsible for the rental property.
You can also opt to run a credit check. This comes with a fee. You may want to ask the applicant to pay for the credit check.
The process of checking a potential tenant’s finances involves two steps. These include:
Verify the Tenant Income
It’s a good idea to try and find a tenant who has a monthly income that’s at least three times the rent payment. Make sure to ask for copies of their past pay stubs.
You can also contact the tenant’s employer. During this call, verify they are employed, how long they have been employed, monthly earnings, and the person’s attendance record.
Run a Credit Check
When you run a credit check, you can find out if the tenant pays their bills on time and find out what their income to debt ratio is. Even if the potential tenant has an income that I three time the rent payment, you still have to consider how much debt they have.
Make sure to check their credit report for other red flags, too. These include things like bankruptcies, civil judgments, or prior evictions.
Run a Criminal Background Check
Criminal information about a person is public record. You can find and view it at most courthouses.
The criminal background checks you run can let you know about both minor and more serious offenses. To run this check, you need a potential tenants date of birth and their full name.
Remember, people with a criminal record may try to falsify this information. As a result, you need to check their identification to ensure they are who they claim to be.
A quality criminal background check is going to include:
- A database search for sex offender status
- Department of Corrections offender search
- Federal court record search
- County Criminal Court search
- Statewide Criminal Court search
It is crucial to run this check so that you know who you are potentially renting to.
Words of Caution
Some states prohibit a landlord or property owner from discriminating against a renter with a certain type of criminal conviction. As the property owner, you may have the ability to better justify your rejection if a potential tenant has a violent crime or drug crime conviction than a tenant with a large number of speeding tickets.
Keep in mind that there is no nationwide database including criminal records. As a result, it is challenging to do a thorough background check in some cases.
Trying to do the background check on your own can be a time-consuming process. As a result, it’s a good idea to find a reputable company to handle this for you.
Make Sure Your Expectations are Clear
As mentioned before, you need to create a good advertisement that as a clear description, nice photos, and even video. With this, you can generate a large number of responses.
Remember, some eager renters aren’t going to meet your criteria. This means it’s up to you to find individuals who are most qualified. One of the best ways for you to minimize the total number of unqualified queries is to make your expectations clear from the very beginning.
To do this, make sure the following expectation is clearly outlined:
- How long the rental time period is for
- If the tenant can/cannot smoke in the property
- If the tenant can/cannot have pets in the rental property
The initial contact you have with an applicant is likely going to occur over the phone or through email. This is your opportunity to gather information about them.
Some things to ask about include:
- The names of everyone who will live in the rental
- The contact information for all occupants
- The reason the person is moving
- The date they wish to move into the rental property
- Total number of pets (if any)
- Smoker status
Finding out the basic information about an applicant as early in the screening process as possible can help you find good versus bad occupants. After you have created a short-list of potential candidates based on initial evaluations, you can issue the application mentioned above.
Trust Your Instincts
Remember, all the tenant screening in the world isn’t going to be as good as your gut instincts and your personal ability to judge a person’s character. You may feel like there is something “off” about a tenant who may look great on paper.
The bottom line is that you need to trust your gut. If something doesn’t feel right, it’s a good idea to look for a tenant elsewhere. While trusting your screening is a good idea, don’t ignore your gut.
How to Find Good Tenants: It Takes Time and Effort
If you are wondering how to find good tenants for your rental property, the information here should help you along the way. By developing a thorough screening process, you can separate the good tenants from the subpar ones. By doing this, you can save yourself quite a bit of time and effort down the road.
There are also several services that can help you with the screening process, if necessary. Make sure to keep this in mind during your search.
If you have an oceanfront condo or residential condo, reach out to us. We can help you know what to look for when searching for a tenant for your available unit. Our team is dedicated to helping fill vacancies quickly and with quality tenants.