Becoming a landlord is not just about finding the right property to give you a decent return on your investment - you’ll need to find the right tenants too.
The difference between a good and bad tenant can make all the difference when it comes to the profit your make. Getting it right can give you a reliable source of income for the long-term, but making the wrong decision could have drastic consequences.
So what can you do to make sure you have reliable tenants that will make your job as a landlord as simple as possible?
Don’t rush into it
You might be in a hurry to get the rental income into your bank account, however you shouldn’t be tempted to take on the first applicants that come your way. Hasty decisions could leave you having to compromise and regretting your quick turnaround.
Planning in advance is key – advertise the property early so you have time to interview a number of potential tenants rather than settling on the first one.
Put yourself in their shoes
When you advertise, make sure you write the ad yourself and take time to consider both what sort of tenant you’re looking for, but also what they will be looking for from your property. A letting agent may be able to write an ad for you, but they may just write a very non-specific ad with a lot of agent speak, which could put off some potential clients that may be suitable.
You can also be proactive and contact potential clients through room wanted ads – this is a great way of finding genuinely interested parties in your local area.
It may also be worth targeting local employers, particularly large-scale companies that may have employees that have relocated or contract workers that require housing on a temporary basis. A contract with a business could be just as rewarding as renting to a family who are looking to settle in the area.
Trust your instincts
If a potential tenant just doesn’t sit right with you then you don’t have to accept an application from them. However, it’s worth bearing in mind that it is illegal to reject tenants on the grounds of race, gender, sexual orientation or religion, as this is considered discrimination.
Give yourself peace of mind
Make sure you run all the necessary checks on your preferred tenants before signing any agreements. Common checks to make include identity and credit checks to ensure they are who they say they are and to check if they are in employment, meaning they are likely to be able to afford the rent.
You could check references with previous landlords however this isn’t foolproof – a former landlord might tell you how wonderful they are just to get rid of them!
Accept (a certain amount of) risk
Landlords can often close off some avenues because they are being overly cautious about the risk involved, which is fair enough when it is such a large investment at stake.
However, it may be a little short-sighted in some circumstances – many short-term lets don’t accept pets in their properties but as a nation of animal lovers it may seem unfair to rule out anyone who will be bringing along their four-legged friend. Of course, it may pay to do some stricter checking – perhaps offer to meet the pet in question and find out how well trained it is first, and it may be worth asking for a higher deposit in order to cover the potentially higher risk of damage to your property.
Stay above board
In order to avoid a nightmare tenant situation, make sure that you remain professional and that everything you do is by the book.
Ensure that you have an AST in place which means that the tenant’s deposit is properly protected. Make sure you give the correct notice if inspecting the property and even more importantly, serve the correct notices if you intend to regain possession of the property from your tenants.
If you don’t play your part accordingly, you may be asking for trouble - particularly from a tenant who is determined to dig their heels in and stay put.
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