While there is no magic formula to make every tenancy profitable, landlords can increase the odds by adopting some of these habits of highly effective landlords:
#1 Highly Effective Landlords Offer Non-Smoking Rentals
Prohibiting cigarette smoking offers landlords a number of advantages: it attracts high-quality tenants who are willing to pay higher rent, makes maintenance and move-out cleaning significantly less expensive, cuts down on fire danger and insurance costs, eliminates liability for illnesses caused by second-hand smoke, and avoids fights with tenants who want to break the lease and move out because of another tenant’s smoking.
#2 Highly Effective Landlords Hedge Their Bets With Pets
Pets are popular, and allowing them into a rental property broadens the available tenant pool dramatically, which in turn reduces costs of vacancies. However, not every rental property is appropriate for pets. If yours is not, it may be best to adopt a strict “no pets” policy.
Successful landlords who allow pets first develop a viable pets policy that regulates how many pets a tenant can own, spells out the ground rules for keeping the animal, and reserves the right to eject the pet if he doesn’t behave. It’s important to anticipate damages and charge the maximum amount allowable for a security deposit when pets are included. A landlord may also want to consider including a pet policy in every lease, in the event a tenant takes in a pet after lease signing.
#3 Highly Effective Landlords Build a Sense of Community
Creating a sense of belonging means more tenant referrals, better retention, and fewer complaints. There are a variety of successful ways to connect tenants to each other, and the community, for instance, a monthly newsletter or community bulletin board, handing out coupons for discounts on local amenities, sponsoring mixers like a pool party or a barbecue, sports league, or a charity drive. In single-family rentals, landlords can also introduce tenants to any neighbours they may know, supply a local business directory or a schedule of local events.
#4 Highly Effective Landlords Are Über-Responsive
Good customer service means listening to the tenants’ complaints, and responding immediately — even if the answer is “no”. Successful landlords tend to follow up after repair requests to make sure the tenant is satisfied, and find ways to communicate with tenants on a regular basis.
#5 Highly Effective Landlords Document EVERYTHING!
From the completed rental application, to a record of every phone call or conversation, landlords must keep a file of everything that goes on with the tenant for the rental business to remain profitably. Successful landlords know to update contact information periodically and require tenants to tell them if he or she changes jobs, banks, phone numbers. This information is crucial if there is a legal dispute, or the landlord needs to collect tenant debt.
#6 Highly Effective Landlords Conduct Tenant Background Checks
A key to successful tenancies: never allow new tenants in without a thorough tenant background check. Never allow a prospect to tour the property without prequalifying and prescreening. Also, conduct background checks on employees and contractors. Make sure vendors do the same with their employees.
#7 Highly Effective Landlords Rule With an Iron Fist
Good tenants love strict landlords. It’s the bad ones who resist. Good tenants know that strict rules will make their home life orderly– free of excessive noise, parking problems, and disruptive neighbors. A landlord must set out the rules, and enforce them on a daily basis. No exceptions.
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Disclaimer: The information provided in this post in not intended to be construed as legal advice, nor should it be considered a substitute for obtaining individual legal counsel or consulting your local, state, federal or provincial tenancy laws.