Being a landlord is no easy job but, with a good deal of real estate knowledge and even more preparation, it can actually be very rewarding. Of course, the key to being a successful landlord is finding good tenants, which sounds easier than it is. Conversely, the worst thing that can happen to a landlord is a nightmare tenant—we’ve all heard the stories. So how do you find these gems? Read on for simple ways to find great tenants and place a stellar candidate in your second property.
Spend Time and Money on Advertising
You can’t become a landlord until you find someone to live on your property, but you can’t just throw an ad up on Craigslist and expect it to work out. In fact, this military.com article points out that you should avoid free sites like Craigslist, as they are notorious for scammers.
Instead, spend the $50 or $100 to put an ad on sites like rentalhomesplus.com and rentals.com. Also, never underestimate the power of the word of mouth and social media. The main benefit of these methods is you’ll likely find someone you know or who knows someone you know, which usually results in more trustworthy tenants. You can also try posting ads in school and church bulletins as well as put out fliers in local businesses.
You might be tempted to go on a hunch or gut feeling, but we urge you not to. Thorough vetting is necessary and should start with an application that asks for references, financials, and employment information. You want to make sure the tenants have had a steady work history as well as the current ability to pay monthly rent and the deposit. Ideally, their monthly gross income should come to three times the monthly rent.
Running credit and background checks is another must. It’s up to you whether you overlook things like misdemeanors, but you likely don’t want someone with a major felony living on your property. You also want to contact their employer(s) to verify employment as well as past landlords to make sure there weren’t any glaring issues. Lastly, you want to enlist SmartMove’s list of questions for potential tenants:
- Do you have a pet?
- Why are you moving?
- How many people will be living in the unit?
- What is your monthly income?
- Have you ever been convicted of a relevant crime?
- Have you ever been evicted or broken a rental agreement?
Make Sure Your Rental Property is Worthy
Much like you want a great tenant, this person wants a good landlord and a nice rental property. Before they come check out the place, make sure the house is clean and that all the amenities are working properly. A fresh coat of paint and new carpeting or hardwood floors can go a long way in impressing solid candidates. As far as the paint goes, pleasant, neutral tones are a good choice, as these people can easily envision themselves there.
Curb appeal is another important factor, so make sure that the lawn is mowed and the landscaping is pristine. This will speak to your attention to detail, which they’ll want in a landlord.
Upgrading a few appliances throughout the property can make a big difference. According to this article from Time.com, it’s a good idea to add appliances that provide additional revenue streams, like vending machines and coin-operated laundry. Consider the features that will add real value to tenants—and improve your bottom line.
Be an Open Book
Again, this process is a two-way street, so they’ll likely have questions for you. Make yourself available, and let them know what they can expect from you if/when there are maintenance issues and other concerns. You might even consider having a “brag book” with positive testimonials from past tenants. Just as you’ll be calling people from their past, they’ll want to know that you have been fair and responsive with past prospects.
Finding great tenants for your rental property can seem like a daunting task, but once you get the process down like a well-oiled machine, you’ll surely have long-term success as a landlord.
Josh founded Money Buffalo in 2015 to help people get out of debt and make smart financial decisions. He is currently a full-time personal finance writer with work featured in Forbes Advisor, Fox Business, and Credible.