Protect your investment

We’ve all heard horror stories about someone who had to endure nightmare tenants, but we rarely hear about Landlords accepting responsibility for having made a really bad choice when acting in haste to fill a vacancy.

Instead of conducting prospective tenant interviews with the underlying fear of choosing poorly, try to change your mindset by viewing your tenants as a “partner in business”.  Here’s my favourite quote, as shared by a fellow colleague:

Definition of a tenant:

A partner in business who will open up the shop each morning and lock it up at night. They will look after security & inform you of potential problems in the business. They will cut the grass, rake the leaves, shovel the snow, pay all the utilities. They will even pay all your mortgage payments and taxes. Then, in the end, they will relinquish all monetary interest in the business and walk away, leaving YOU with all of the profits.”\

Always remember to treat your investment property as a business. After all, happy tenants = a happy & profitable business:

  • Give them a housewarming gift on move-in day.  Perhaps a basket full of cleaning supplies (win-win)?  Perhaps give good tenants small birthday or Christmas gifts.  Think about how you would reward your staff, and follow suit with your tenants.
  • Other ideas could include offering “good tenant” incentives, such as giving a $5 Tim Horton’s gift cards each month that they pay their rent on time.

As investors, you should always be well versed on your local landlord tenancy act, and you must use the resources you have available to you to do your due diligence when selecting proper tenants.  Here are some additional tips:

  • Call all references provided
  • Perform credit checks on all adults who intend to inhabit the property
  • ‘Creep’ their social media profiles (you can learn a lot about a person’s lifestyle this way). While you’re at it, look up their references too!
  • Look for clues when they meet with you to view the unit:
    • Meet them outside when they arrive at the property. A quick inadvertent glance at how clean the interior of their car is, can say a lot about how clean their lifestyle habits are.
    • Did they show up on time or have a legitimate reason for being late?
    • Are they appropriately dressed for the appointment?
    • If you wish to have a non-smoker or no pets, look for clues on their clothing for signs of either.
  • Although each property has its own unique needs to fulfill when interviewing tenants, here are some to consider:
    • Ask a lot of questions in everyday conversation:  Ex:  What awesome weather we had this past weekend…did you have a chance to enjoy it?  If they reply, “Yes, I had the chance to catch up on some reading before volunteering at the food bank.”, this might look favourable to you.  If they reply, “The weekend was awesome!  I threw a huge party all night long, living it up until the sun came up.”, then maybe this isn’t the most ideal tenant for you.
    • What drew you to this apartment? (a tenant who is excited about living there, is more likely to take good care of it and stay long-term)
    • How soon are you looking to move? (are they leaving their last landlord high and dry?)
    • How many people will be living here?
    • How long are you looking to rent for?
    • How long have you been living where you are now?  Tell me about your experience there… (a tenant who complains a lot about their last landlord might wind up doing the same to you)
    • Have you given your landlord proper notice?  (if not, will they do the same to you in the future?)
    • The first and last month’s rent are due on the day that you move in.  Do you foresee any problems with this?  (shows financial responsibility)
    • Are you presently working?  Tell me about your job… (a tenant who complains a lot about their employer, might not have a stable job)
    • How long have you been working there?
    • Do you have a vehicle? (is there adequate parking available for their needs?)
    • Are you a smoker?  (if so, a shared ventilation system with other units might pose a problem)
    • Do you have any pets? (if your rental property is a condo, some condominium boards have strict rules on the types of pets permitted)

I hope that you’ve enjoying reading this post.  If you have any questions or comments, please feel free to contact me at mivy@trilliumwest.com.  And always remember…a vacancy can cost you a lot less than having a really bad tenant, so take your time and choose the right “partner in business” for your property’s needs!

Michelle Ivy

About Michelle Ivy

I love to write about my passion - Investment Properties in the city of Guelph. Educating my clients and working with them every step of the way to build their wealth through property investment.

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