Landlords are jacks of all trades. They are responsible for a variety of tasks, each of which must be run effectively in order to maintain a successful rental business.
One of a landlord’s most important jobs is tenant management. Because tenants play a critical role in the health of your cash flow, having an efficient tenant management system is integral to the success of your real estate business. Below we provide 10 tenant management tips for property managers.
#1 Screen Tenants Thoroughly
Running a successful rental business starts with quality tenants. The only way to ensure that you’re leasing to the most qualified renters is to screen them thoroughly. An effective screening process should include credit, criminal, and eviction history checks. With a holistic screening approach, you can rest assured that you’re only signing the best tenants.
#2 Create a Detailed Lease Agreement
Having a detailed lease agreement is a necessary component of tenant management. Leases are legal agreements that lay out what exactly is expected of tenants and landlords, as well as what will happen if any part of the agreement is broken. A generic lease will not cut it.
Leases should be written in language that can be understood by your renters. They should cover everything from parking and roommates to property alterations and pets. Leases also must detail the consequences for late payments and property damage.
#3 Establish an Efficient Rent Collection Process
Rent payments are likely the primary source of revenue for your rental business. As such, it is critical that your rent collection process is effective and efficient. More and more landlords are making the switch to online rent collection. With recurring payments, automated records, enforceable late fees, flexible payment options, and more, it really is a no-brainer.
#4 Maintain Professionalism
Although strong tenant-landlord relationships are important, you must also remain professional. It’s good to be friendly with your tenants, but remember that they are not your friends. Becoming too lax and allowing renters to repeatedly break the terms of your lease is a slippery slope. Maintaining a level of professionalism with your renters is necessary in order to create and uphold that barrier.
#5 Communicate Effectively with Tenants
In order to maintain a cordial relationship with your tenants, you must establish effective channels of communication. When a tenant reaches out to you with an issue, question, or maintenance request, you should respond promptly and respectfully. This is especially important if you want to retain quality renters to reduce tenant turnover.
#6 Require Renter’s Insurance
In addition to the property insurance that you, as the landlord, are responsible for, you should also require that tenants buy renter’s insurance. Renter’s insurance ensures that tenants’ belongings are protected, and it also offers an added layer of protection for landlords. You should require that tenants provide proof of rentersinsurance as a part of their lease agreement.
#7 Utilize Incentives to Retain Quality Tenants
Good tenants can be hard to come by. When you do find one, you should put in the extra work to keep them. Offering incentives can be an effective way to encourage your best renters to renew their leases. There are endless possibilities when it comes to incentives, but some common ideas include slightly lower rent, reduced pet fees, and discounts to local businesses.
#8 Enforce the Rules
Although it’s important to be empathetic and understanding with your tenants, you must enforce the rules. Your rental business cannot afford tenants who don’t pay on time, who make partial payments, who damage your property, and who disrespect other renters. When tenants break the rules outlined in their lease agreements, they must face the consequences. Letting things slide once opens the door for rules to continually be broken.
#9 Survey Tenants
The best way to ensure that you’re providing tenants with a satisfactory rental experience is to ask what they think could be improved. You should send out semi-regular, anonymous surveys to your tenants, asking what you could do better as a property manager and what could be better about the property itself. This way, tenants are empowered to share their honest opinions about their rental experiences.
#10 Respect Tenants’ Privacy
Once a tenant moves into your rental property, they have a right to privacy. You should not enter the rental without their permission, unless there’s an emergency. If you need to make repairs or conduct an inspection, you should be sure to give them ample warning. Each state has different laws regarding when a landlord can legally enter a tenant’s rental residence, so be sure to be aware of your local legislation.