Finding the right tenant is easier said than done. It is a dream of every ambitious person to enjoy the benefits of a passive income. The rental yields will pay off the mortgage loans and watch your capital property investment increase in worth. But in order to become a successful landlord, you need to hone your skills to discern and distinguish between a bad tenant and an ideal renter.
Nobody wants to get into the irritating situation where the tenant stops paying rents or causes harm to the property. Here is how you can find the best tenant for your property:
1. Define Your Standards for the Renter
Unless you determine the standards for the prospective tenant, it will be very difficult for you to assess which tenant is bad for you. Some of the things that you should predefine are:
- No prior evictions or criminal record
- Have an active and stable income earning at least three or four times more than the rent
- A high credit score — more than 600
- The presence of pets
- The number of residents who will be living in the house
It is important to run the desirable renters through this screening process, as it will help you in choosing the ideal tenant.
2. Take a Substantial Deposit
Ideally, you should ask the renters to pay a large deposit as it will protect your property against damages. Furthermore, the deposit ought to be greater than the monthly rent. It will hinder the tenant from assuming that the deposit covers the payment of the previous month’s rent.
3. Meet the Tenants in Person
You must talk to the potential renters personally and walk around the property with them. A personal interaction will let you judge the attitude of the renter and whether they will be able to respect your guidelines and inhabit the dwelling as a model renter. Your gut feeling and instinct will also allow you to make a better judgement.
4. Background Check and References
You cannot trust the word of the tenant alone and you should verify their statements by performing a background check. Do not hesitate to call the previous landlords and neighbours, the employer, and the credit unions to inquire about the tenant. The past landlords should have a high opinion about the prospective tenant. Ask the previous landlord about the cleaning habits of the renter. You would want to be sure that the prospective tenant will not cause harm to your property. There are plenty of online resources through which you can run the credit check.
5. Create an Application Form
After you have done the initial screening and met the potential tenants, you should ask them to fill out an application form. The application form can be designed according to your personal preferences so you can include questions in it that will let you know more about the tenant. For instance, ask them how they discovered the listing, whether they have sufficient money to pay both the rent and deposit, the number of family members and if they have pets. You can ask for the contact details of their employer and the past landlord.
If you are looking forward to invest in a rental property in South Australia, then you can approach My Property House. The professional analysts will help you in making a wise decision.
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