I talk to so many people who tell me that they would love to have a rental property or two but that they are afraid to be a landlord or land person.
I have been a landlady since I was around 23 years old and it has served me very well! I am all about multiple income streams in my financial basket and owning properties has proved to be one of the best and most secure investments that I have made.
Of course, there are legitimate concerns over owning rental properties and dealing with maintenance and tenants, but it can be very rewarding too. I have great relationships with the majority of my tenants and some have become friends to this day!
One of the secrets to being successful in this industry is by learning to get great tenants and that comes with experience.
I provide coaching for people who wonder if they are cut out for this job but I will share here a few pointers on what would make a good tenant.
Good Tenants
. People who are friendly, open, and transparent. They answer the phone in a cheerful voice and don’t seem like they need to hide anything from you.
. People who take care of their things. Do they have a vehicle? Is it well cared for? Do you know where they live now? What does their current landlord say about how they keep their unit?
. People who have a good track record of paying bills and rent on time.
.People who have a great relationship with their current landlord(s). I have found that the best tenants are the ones that have gratitude and appreciation for their landlord or the home/unit they are currently leaving. Often they don’t want to leave but the owner is perhaps selling the home or something like that. These types of tenants seem to transfer that great attitude with them when they come. But keep in mind you must be a great landlord too! It works both ways.
. People who are non-smokers. Now don’t beat me up on this one. Hear me out. I was a smoker myself for many years, it’s not about smoking although that is a BIG issue, especially if there are multiple units involved and there are health issues with other tenants such as asthma or breathing problems, not to mention the smoke damage to the units.
However, the big issue that I find with smokers is the expense of smoking. Here in Canada, a package of cigarettes at the corner store is somewhere around $15 to $18 a package! This is a very expensive habit and let’s face it, an addiction. And with addictions, they usually win when it comes to budgets.
And like I said don’t beat me up on this, I believe in free will and choice and smokers have the right to smoke. I also have immense compassion for smokers who want to quit but struggle. I also have wonderful friends and current tenants who are indeed smokers, however, I am only coming from my 30 plus years of experience and what I’ve seen on rent day in many cases. And it’s all about the math!
. The math has to work! It doesn’t matter what the source of income is, but the math has to work! In my experience with some tenants, they think they can afford the rent and expenses but in reality, the numbers don’t work. I also try to make sure they have a full grasp of the total expenses and are very realistic about if their income matches the expenses. I don’t want them to be unable to afford their rent or to suffer. Nobody wants that.
I always want my tenants to enJOY their home and to also be able to enJOY life so the math has to work.
On another note, I have also noticed that when tenants get behind in rent they sometimes believe that they can catch up, but the reality is the math just does not support it in many cases. The math must always work. And are they prepared for unexpected expenses in life? Again the math must always work.
I hope you found these tips helpful and I encourage you to be open-minded about being a Landlord. Owning properties and renting them out can be an asset and an income that also provides tax deductions for repairs and maintenance, mortgage interest, and such…. lots of benefits indeed.
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Maggie Holbik Business Coaching 