Rental properties can certainly be lucrative for real estate investors when they are properly managed. They provide consistent income while typically increasing in value. Housing is a commodity constantly in demand since people will always need a place to live.
One of the surest ways to maintain a solid return on your investment is to keep it occupied with good tenants. Tenant turnover and problem tenants can be very costly, so tenants who always pay rent on time, take good care of the property, and don’t cause problems for neighbors are worth their weight in gold. Here are some suggestions on how to keep good tenants in your rental property.
Screen and Qualify All Applicants
Usually, past behavior is a good predictor of future behavior, so it’s important to thoroughly screen tenant applicants and pick qualified ones for your property. Professional property management services should always include an applicant screening process.
Tenants with a poor credit history or past evictions are more likely to pay rent late or miss payments than those with clean credit reports and no prior evictions. It’s also very important to verify applicants’ income to ensure they can afford the monthly rent.
Keeping good tenants starts with signing good tenants, so the screening process is vital.
Have a Good Lease
Sometimes, problems between tenants and landlords develop because expectations and obligations aren’t clearly defined at the beginning of the rental period. The best way to avoid such a situation is to have a good, well-written lease.
A solid lease should make clear the obligations of all parties involved, including the rental owner and property manager. Expectations regarding the timing and manner of rental payments, property maintenance, procedures in the event of an emergency, inspections, utility payments, pet provisions, prohibited behavior, and more should all be in writing and signed by both parties.
Clearly defining the terms of the tenant-landlord relationship from the start is a great step toward keeping good tenants.
Respond to Issues Promptly
Just as in any relationship, communication between tenants and property owners or managers is key, and responsiveness is a huge aspect of that communication. Nobody likes to feel ignored or kept waiting, and the easiest way to turn off good tenants is to make them feel unimportant.
Whether it’s an emergency, a general maintenance issue, or even a problem making a rent payment, you must be responsive when a tenant reaches out. Ignoring an issue never makes it go away, but it does risk driving a good tenant away.
Reputable companies that provide property management services will reply to issues promptly, and most offer 24-hour emergency communications service.
Maintaining the Property
Nobody likes to live in a home that is not well-maintained. If your house’s furnace or air conditioning were not working properly, you’d take care of it promptly. You will call a plumber if a toilet does not flush or a tub is not draining. Tenants in your rental property have the same expectations.
Ensuring that there are no fire hazards, trip hazards, or other problems that could make tenants feel unsafe is first and foremost on the list when maintaining a property. Most people want to live in a nice place, so keeping up the exterior and replacing anything worn out — windows, flooring, appliances — goes a long way, too.
The nicer a property looks, functions, and feels, the more likely good tenants will stay.
Meet State, Federal, and Local Regulations
When a property owner or management company does something unlawful or against a code, tenants will usually know. Knowing and carefully following all state, federal, and local regulations is imperative. Good tenants do not stay in situations they don’t feel are on the up and up.
And regulations can change, especially at the local level. If you have a property in Los Gatos, your Los Gatos property management company should properly maintain your property and consistently monitor all building codes and regulations for rental properties to maintain compliance.
The Bottom Line
Attracting and retaining good tenants is the key to owning a profitable rental property. One of the most important functions in property management is tenant screening and selection. Use a property management company that provides a well-defined process for screening and selecting tenants and ensures your property will be well-maintained and comply with all federal, state, and local laws.
Valley Management Group provides trustworthy and affordable property management services to rental property owners in San Jose, Santa Clara, Los Gatos, and throughout Santa Clara County. Contact us to get a free management quote with one free month of property management services.