One of the important factors that influence the success of a rental property is finding the right occupant. With the right tenant, it is guaranteed that rent will be paid on time every time and the property will remain reasonably intact, save for normal wear and tear. With a bad tenant, the condition of the investment property is always uncertain.
With more and more people moving in and out of different Brisbane suburbs, if a property is well-marketed and presented, there’s no doubt it will attract various types of tenants. However, for self-managed landlords, finding the right tenant for their property can be tricky and challenging.
Any prospective tenant will put their best foot forward during the initial walk-through of the apartment. This makes it difficult to make an informed assessment during this brief interaction. There are no hard and fast rules when it comes to finding the best tenant. You can, however, do a thorough screening of each applicant before allowing them to sign a lease.
Here are some tips to help you sort the good from the bad, and give you a pleasant and profitable investment experience:
Get Relevant Information
The rental application is a series of questions that allows the landlord to know about the prospective tenant. To get the best results, the questions should cover financial, employment and personal information.
It is also important to gather lifestyle information. Is the applicant a pet owner? Do they work odd hours or away from home? Do they often get visitors that would stay in the property?
The information they provide in their rental application should give you an idea of whether or not they are the kind of tenant that you are willing to trust your property with.
Ask For References
Do at least three reference checks from past landlords when possible. Ask the landlords how long the applicant stayed at previous properties and their reason for leaving. Good tenants live in one property much longer, usually at least a year, and their property manager or landlord reference will be available or easily obtainable. Any discrepancy in the information provided implies that something is being kept secret by the applicant and would usually raise a flag.
Check a Tenancy Database
You can check if the applicant is included in any tenancy database, a record of personal information about tenants who have had issues with their tenancies. The database tells landlords or managers whether prospective tenants had a previous record of not paying rent or damaging the property.
Here are tenancy databases that landlords or managers can contact:
- Tenancy Information Centre Australasia
- National Tenancy Database
- Trading Reference Australia
Interview the Applicant
Conduct an informal interview of applicants that have passed the initial background screening. You can do this either by phone or face to face during a walk-through of the property.
When showing the property, pay equal attention to “selling the property” and evaluating the prospective tenant. Ask questions that will help you determine if they meet your requirements for a tenant. Do they conduct themselves in the right manner? Do they look neat or unkempt? Do they smoke?
Consider Hiring a Property Manager
A property manager will take a lot of load off your back as a landlord. They will take over many responsibilities, including screening prospective tenants and managing the operations of your investment property. Unlike self-managed landlords, they have access to tenancy databases, individual public records, identity verification and credit history.
At the outset, make sure your property is properly presented and marketed in order to attract as many prospective tenants as possible. Having a large pool of applicants increases your chances of finding a long-term tenant.