The Key to Profitable Rentals in 2013

by Chris on December 26, 2012

One of the best ways to ensure the  profitability of your rentals is by actively managing those properties throughout the year.

Active management requires more than being present or available for your tenants. It means honing a special set of communication skills.

Here are some tips that can help make 2013 a more prosperous new year:

Every Communication Counts

Keep in mind that early communications are what form the tenant’s view of the landlord.  If the tenant develops misgivings, it’s difficult to recover.   The rental ad, the first phone conversation or first meeting and the rental application need to set the stage for clear, effective communications that portray the landlord as knowledgeable and in charge.

Keep Everything in Writing

A lease agreement should be in writing. While verbal leases are still binding in many cases, these are far more likely to spark a dispute.  The written lease should provide that any subsequent changes also be in writing to eliminate future misunderstandings.

Be sure the lease contains the pertinent house rules, rights and responsibilities between the landlord and tenant.

Be Clear With the Rules

In order for tenants to abide by the rules, they need to understand what those rules are. Tenants must be clear on what they can and can’t do, and who handles routine maintenance and repairs.

These rules must be stated in simple, clear language and not in legalese.  A good rule of thumb is to have a neutral person read the lease or house rules list before these are offered to a tenant.  If they can’t understand something, there is still time to clarify.

Don’t assume that tenants will understand things that seems obvious to a landlord. Spell it out in the lease and avoid costly disputes.

Go over pertinent rules during the initial interview, and again at lease signing.  In fact, it doesn’t hurt to review important points during a new tenant orientation, or to post the rules online for easy reference.

Ongoing Contact a Must

Stay in front of the tenant throughout the lease term. This should include a few routine inspections, but can also be a “virtual” presence — like a monthly newsletter, or even something as simple as emailing or delivering a rent receipt.

If it seems as though the landlord has disappeared, the tenant is more likely to deviate from the rules.

Keep Records of all Interactions

Make notes in the tenant file each time there’s an interaction, including a record of rent transactions, phone conversations, and repair requests and completions.

With clear and effective communication, landlords can eliminate the confusion that too often leads to a costly tenant dispute.

 

This post is provided by Tenant Verification Service, Inc., helping landlords reduce the risks of renting with fraud prevention tools that include Tenant Screening, Tenant Background Checks, (U.S. and Canada), as well as Criminal Background Checks, and Eviction Reports (U.S. only).

Click Here to Receive Landlord Credit Reports.

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.

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