Being a landlord sure isn’t easy but, if you do it right, it can also be extremely rewarding—financially and otherwise. The biggest pitfall to avoid is tenant turnover as, let’s face it—it’s just a gigantic pain in the behind. If you’re doing it right, the screening process is intense so the idea of doing it over and over again is morbidly depressing. Not only that, but it costs you a lot of money due to lost income, repairs to the place, cleaning, applicant processing, and more. How do you avoid it? Make your tenants happy! Read on for more tips on how to decrease turnover in your rental property.
Make Your House (Or Whatever It is!) a Home
As a landlord, when you give respect, you get respect. That doesn’t mean you have to decorate your place with all the goodies from Pottery Barn or even incorporate the most modern amenities. However, there are homey touches you can provide that will make your property go from feeling like a house to a home. And as cheesy as it may sound, you should try and get to know as many of your tenants as possible—you can never underestimate the power of the personal touch.
Be Thorough with Your Screening Process
Retaining good tenants means landing them in the first place, which requires an intensive vetting process. You’ll need to have applicants fill out a thorough application, call their references, call past and current employers to assess ability to pay, and do a thorough background and credit check. Fortunately, you can get a free credit and eviction history check through companies like TransUnion. While you don’t want to dismiss anyone out of hand for things like misdemeanors, if there is a long history of leaving jobs and/or inability to pay rent, you may want to reconsider. Learn how to read a Transunion credit report and discover which red flags to look for when screening prospective renters.
Handle Issues Promptly
There will be inevitable issues with any rental property, even if it’s in tip-top shape—this simply goes with the territory. But if your tenant(s) can’t get a hold of you, it’s going to be a problem. It’s one thing for you to be unreachable once, but if it’s a recurrent issue, these people are going to begin to wonder what benefits they’re getting from renting vs. buying and may consider leaving or raising legal issues. You may want to consider hiring a property manager to handle the daily nitty-gritty.
Make Sure Your Location is Ideal
This is something you have to take care of from the get-go but, as anyone who is in real estate knows, it’s all about location, location, location. If you can nab something in a prime area of a city or suburb that people love, you’re less likely to have turnover. And even if you do, all you have to do is pop a sign up in the window. A prime location means it usually receives a lot of foot traffic, meaning you’re sure to have your next renter applicants lining up at the door.
Make Sure the Price is Right
Bob Barker isn’t the only one interested in whether the price is right. If you’re a “newbie” landlord and you don’t do your due diligence before setting the rent, you could be in trouble. If you try to price gouge, raise rent, and/or aren’t aligned in treating your tenant the way he or she deserves to be treated for the price you are charging, you’re going to be left holding the bag (and it won’t be filled with money). If you simply don’t know, ask others in the field and study the market as much as possible to make sure you’re setting a fair rate.
On top of pricing your property correctly, you might consider adding incentives once tenants have moved in and shown themselves to be worthy. If they’re coming up on a year lease, think of giving them something like half off of their first month’s rent for the next year. This is not a ton of money for you in the big picture but, for them, this could seal the deal in making them long term tenants. You might also consider incentivizing them with upgrades, like a remodeled kitchen or master bathroom.