GUEST POST: SELECTING THE RIGHT TENANTS WITH EMO IKEDE
Landlords have taken a lot of heat in the press lately, but small landlords (often called “mom and pop investors”) are a very important component of providing affordable rental housing. Becoming a landlord is also a great way to build wealth through real estate; however, “bad tenants” can really eat into your bottom line.
A bad tenant is one that:
1. Destroys your property
2. Doesn’t pay their rent on time or at all.
3. Doesn’t get along and causes problems for neighbours (confrontational, noise, garbage, etc.)
In this blog, Emo founder of EjiTech Education and author of 11 Steps For Landlords To Find Great Tenants shares his top 3 tips to avoid bad tenants.
1. Prepare Your Property
“You set the tone for how your tenants should take care of your property”
It is important that the inside and outside of your property are clean and tidy, and that all repairs are done. This establishes the baseline of how you expect the tenants to take care of your property.
So, mow the lawn, fix any broken items, and make sure the paint on the walls is good. Doing this shows you take pride in your property, and improves the perception of the value of the property in relation to the rent collected.
2. Confirm Exception
When a prospective tenant (applicant) first contacts you to find out if your property is still available, it is a good idea to confirm they understand some of your rental terms.
For example, if in your ad you stated that it is a non-smoking or no-pets rental, this is a good time to make sure they understand this so that you know if you should proceed to the next steps of the screening process.
You don’t want to spend a lot of time on someone who does not meet your ideal tenant profile (or waste their time when you are not going to select them.)
3. Do a Credit Check
This confirms your tenant’s identity, financial status, probability of paying you on time and a whole lot more. It is crucial that you do a credit check for all adult tenants.
Examples of Canadian companies you can use to run credit checks are SingleKey (www.singlekey.com) and Naborly. (www.naborly.com)
For a full list of rules to review prior to making your decision to enter the investment property industry, Nova Scotia provides a full guide with specific regulations for our area. Starting your landlord-tenant relationship on a solid foundation can make a huge difference in maintaining your investment portfolio.
Real Estate Advisor based in Halifax, Nova Scotia. I help people buy and sell homes with Engel & Völkers.