Are you watching your tenant turnover rate like a hawk?
This problem can generate an average of $2,000 in losses per tenant. Frequent turnover puts more work on your desk and can even negatively impact your chances of selling an investment property. Future buyers do check these rates to see if the property is worth the investment.
You need a lease renewal strategy that keeps tenants in units for at least three years minimum. However, don't make the mistake of starting this process too late. You should approach your tenant screening process through a renewal strategy lens.
Here are a few landlord-tenant screening tips to remember.
Define Your Ideal Tenant First
If you want to attract tenants with long-term potential, you must tailor your marketing strategy to them. This process begins with the ideal tenant profile.
What defines an ideal tenant?
Someone who pays rent on time and can prove they have the income (and cash reserves) to pay subsequent months' rent without issue is critical. Start to craft a profile for this goal.
Asking the right questions will point you in the right direction:
- What is an ideal annual income?
- Which occupations reflect this annual income?
- What is their past rental history like?
- Do they have references who can vouch for them?
- What are their long-term goals?
- Do they work in the area?
- What is this ideal tenant looking for in a rental?
Once you establish the traits of an ideal tenant, you must tap into their preferred amenities to market to this ideal tenant profile.
Just because they're able to afford a monthly rate, doesn't mean they believe that your property is worth that rate. You may have to upgrade your investment property to justify the monthly rent price.
Tenant Screening Meets Property Marketing
Appeal to your ideal tenant through target marketing campaigns.
Take professional photos of the property's interiors and exteriors. Include photos of the neighborhood itself and any nearby amenities. Proximity to shopping, attractions, and transportation is a big draw.
A property manager can handle the marketing process for you, including holding open houses and application handling. If you work with a property management company, they can direct leads to online applications for easy processing.
How to Conduct a Tenant Background Check
It's best to put the background check process in the hands of an experienced property manager. They have the best tenant screening tools that pull information from reliable databases and verify references and income.
The following information is screened during the tenant verification process:
- Government-issued ID and social security numbers
- Employment verification (past and current employers)
- Additional income verification (bank statements, etc.)
- Rental payment history
- Past residences (and current address)
- Reference letters
- Criminal history
A property manager will also conduct in-person interviews with applicants to gauge long-term potential. This is crucial for capturing more lease renewals.
Attract Only the Best Tenants
Start by defining your ideal tenant and make sure your rentals meet their expectations. Next, hire a property manager experienced in tenant screening and maintenance to secure lease renewals.
At Wilkinson Property Management, we've managed over 633 rental properties since our founding in 1999. We're committed to making the Charlotte area one of the best places to live in North Carolina.
Schedule a consultation to learn about rental property screening and more services.
