Through our years in real estate, we’ve fine-tuned our process to screening tenants. This consistently increases the odds of connecting with the perfect tenant. Here are two insider tips to how we accomplish this:
Who will tenants provide as references? Obviously the most unbiased, honest people who have your best interest in mind, right? Perhaps not? Tenants will write down their parents, siblings, best friend or somebody that owes them a favour. They are consistently people who will say whatever it takes to get their friend approved. So do you call them? Sure! It doesn’t hurt to call. Their stories may not align, they may stumble to provide answers, perhaps they don’t know the applicant well. It never hurts to do your due diligence. But, where do you go for real character witnesses? People that will provide honest feedback on the person and better help you qualify them? Here are two places we look:
Previous Landlords and Real Estate Agents
Using a driver’s license, credit report and rental application, we’re often able to track down the previous two or three locations where a prospective tenant lived. We then reach out to the real estate agents and/or property managers involved in those properties as they’re likely people who aren’t involved in the new transaction and are less likely to have a bias in their opinion –they have nothing to gain or lose by being honest. Existing landlords, while one would hope an investor like yourself would be ethical in providing honest feedback, may have a different agenda to get rid of a difficult tenant and be willing to say whatever it takes to get them into your house.
The Tenant Interview
The number one mistake that landlords make is skipping the tenant interview. Your opinion of somebody on paper vs. in person may be very different. Forging documents is easy, selling a lie in person is not. Ask a lot of open-ended questions such as “Why are you moving” and “What type of pets do you have?”. Lots of people lie on rental applications about pets out of fear of not being accepted. If they lied, you’ll often catch them here and it may provide insight into their character. The tenant interview will usually solidify a decision on whether or not they’re a good fit.
To sum things up, there are many things to consider while finding your next tenant(s), everything from pricing a bit more aggressively depending on market conditions to providing perks for tenants but these two tips have proven to serve us well time and time again.