How to Find Tenants
/We frequently get asked how we find tenants, and more importantly how do we find good tenants. We’ve been very fortunate with the bulk of the tenants we have, as they are great people, but it doesn’t mean that you can’t get a bad egg from time to time. Sometimes regardless of the screenings, that one tenant can still slip through. In order to reduce that risk, this is the process we follow each time we are looking for tenants.
Advertising the apartment
When you are ready to list the apartment, make sure it shows as best possible. I’m a big believer that if you have a nice apartment you will attract nice people, and if you have a crappy apartment you’re probably going to attract crappy people. And the same can be said that if you do have a nice apartment, people tend to respect that and want to keep it nice. So before you list it, make sure you are putting your best foot forward.
Next, back in the day before Facebook Marketplace, we used Craigslist to list our apartments. Craigslist would then link with other companies such as Trulia or Hotpads to list the apartment increasing visibility. Now with the addition of Facebook Marketplace, you can post your apartment there and have a great response rate within the first couple of hours. We find it much easier and you can see who you are talking to. It also reduces the scamming that can happen on Craigslist.
When you are listing the apartment, make sure to include all necessary information to eliminate repetitive questions. Generally you will want to address:
Bedrooms/baths
Utilities included or separate
Pets/no pets
Price
Laundry or laundry hook up
Parking
Yard
Any upgrades
Showings
Once you have the apartment listed, you’ll start receiving inquiries. So before you start answering each one, figure out a day you can do an open house. This was advice I was given when I first started but I never really implemented until recently. It is very time consuming to set up individual showings for each possible tenant, and even more time consuming when people don’t show. So save yourself the frustration up front and schedule a slot of time to have an open house. This way people can come and go as they please. Print out a bunch of applications to take with you so when it’s over you hopefully have a couple good candidates to check out.
Application Process
The application process is pretty straight forward. I have included a copy of the application we use below. This is just a standard application put out by the Pennsylvania Association of Realtors. This application gathers all the information you need to perform a background check, credit check, landlord reference and work reference. These are the four areas we focus on when sifting through applications. It typically only takes a day to qualify or disqualify someone pending on the response rate of the previous landlord and place of employment.
It is up to you as far as what is acceptable and not acceptable on applications, but whatever you chose your standards to be, make sure you stay consistent across the board.
Lease
Once you have chosen your tenant, it is time to create a lease. We use the same lease for each tenant- just alter the location and rent. In the past, we used to do a year lease which would then convert to month to month at the end of the year. Month to month means that the lease will automatically renew each month unless either the tenant or landlord provides two week notice.
To the right is an example of the lease we use. Again we use the same lease as the Pennsylvania Association of Realtors. It has worked well for us and covers everything we need it to cover. Since we are not real estate agents, you can disregard the top portion of the lease.
Today we solely use month to month. We have found this to be the best option for us as well as the tenant. For us, it helps eliminate the risk of keeping a poor tenant. When you are locked into a year lease, it’s a little bit tougher to evict a tenant. It’s still possible, it can just be more of an ordeal especially when it comes to money. When it is month to month, if things aren’t going well you can terminate the tenancy (with proper reason). For the tenant, there is less pressure with a month to month. If something were to change in their lives, they don’t have the stress of paying high fees to get out of a lease early. Or if they aren’t happy with the apartment, they aren’t stuck living there for a year. So it seems to work out best for both parties. Initially I was worried going month to month because I thought tenants would be less likely to be long term tenants, but we haven’t found that to be the case. So far over the last two years, we have brought on six new tenants and only one tenant has since moved.
I have also included the lead-based paint disclosure form.
“It is a required form to be issued to all tenants and potential buyers for residential properties built before 1978. The paint specifically was outlawed by the U.S. Consumer Product Safety Commission at that time (16 CFR 1303) due to the hazard it poses when it chips. The forms were written to warn any new owners or tenants of the potential existence of this within the interior walls of the residence. Therefore, if an individual resides in an older home and witnesses chipping or cracking of paint, they should immediately notify the recommended local authorities.” -Laws – 42 U.S. Code § 4852d
So basically on the lease, it will ask if you have any knowledge of lead based paint. If the house was built after that date, you have nothing to worry about. If the house was built before 1978 and there is chipping paint in the home, you will want to get that fixed prior to renting to avoid any potential issues. We personally have scrapped and repainted all of our apartments which helps eliminate the risk of lead based paint. The state also provides a pamphlet for you to give tenants regarding lead based paint. This just helps protect you as a landlord and ensures you are doing your due diligence for the safety of the tenants.
So that is pretty much the process we go through when looking for tenants. Once you have done it a couple times, its not as daunting. Anytime you try something new for the first time it can be a challenge- so don’t get discouraged if things aren’t 100% perfect the first time around. Its all a learning process. So just stick with it and if you have any questions please feel free to reach out! Best of luck!
