AVOID TENANT PROBLEMS – FOLLOW THESE 12 TOP TIPS
12.) Avoid Asking For The Absolute Top Rent
I’ve found over the years that asking for top-of-the-market rent is asking for trouble. If you’re desperate to get that extra few dollars, you’ll often end up compromising about the quality of tenant you accept.
It’s better to ask for slightly less than max rent and get more rental applicants who you can screen to get the most qualified tenant.
11.) Be Smart About Rent Collection
Are you trekking around the city collecting rents from your tenants yourself? Stop! Not only is showing up at your (potentially financially strapped and therefore stressed/angry) tenants’ doors possibly dangerous, but it’s incredibly tedious, time-consuming, and inefficient!
Instead, check out alternative options, from having your tenant INTERAC the funds to you every month by email to asking (not demanding) him or her to supply post-dated cheques for the term of their lease. If there’s been a problem with a cheque bouncing, ask for bank drafts instead.
10.) Start Adding Systems NOW
You’re just a “mom and pop” landlord looking to make a little side income, right? No need to hone your methods or organize paperwork?
WRONG. If your ultimate goal is to achieve more free time and not be tied to your day job (and yes, landlording can definitely be a demanding day job), you’ll do yourself a HUGE favor to start building systems now.
That way, when you’re the proud owner of 2, 3, or maybe even 5+ rentals down the road, you’ll be able to step away seamlessly for that early retirement — and your business will still run like a well-oiled machine.
9.) Be Knowledgeable
To make landlording an easier task, you need to be well equipped to handle the problems that you will face. The best way to do this is through education.
There’s lots of information online OR you could contact us… we’ve got years of expertise in dealing with all kinds of tenant situations.
Education doesn’t end with high school or college — it simply becomes more important.
8.) Create a Policy & Stick to it
If you are running your rental business off the top of your head, making up the rules as you go, you are opening yourself up for a lot of hassle. Tenants will know if you are making rules up on the spot (no, you cannot pay rent in quarters) so having a written policy — that your tenant has a copy of— will make life much easier.
Rather than trying to explain why a certain action is not allowed, you simply can refer to the policy.
“I’m sorry Hans, our policy states that rent must be paid by a bank draft.” People tend to not question “policy” even if you are the one who created that policy. Once that policy is created, don’t deviate from it.
For all condo rentals, provide your tenant with a copy of the condominium Rules And Regulations from your Status Certificate package. The concierge and property manager will thank you for it.
7.) Quality Product = Quality Tenants
While this isn’t a hard and fast perfect rule, in general the quality of your tenant will depend largely on the quality of the suite you are providing.
I’m not suggesting that you have to offer granite counters in your rental — but by providing a better-than-average suite you will set a standard for the kind of tenant you attract and keep.
As a landlord, your product is not only the rental itself. Your business is part of the product, and the way you run your business will affect how your tenant views your product.
Fix repairs promptly (hire it or not), maintain strict professionalism, and stay organized.
6.) Set Office Hours
Do you want to fix repairs at 10:00 at night? How about receiving phone calls at 6:00 a.m.?
As a landlord, you get to set your own hours. I publicly let all my tenants know that I am only available between 10:00 am and 6:00 pm on weekdays. Of course, I have a cell phone that will ring any time. Tenants don’t need to know that, though.
When they do call outside of office hours, I will always let the call go to voicemail. If it’s important, they’ll leave a message. If not, it probably wasn’t important.
The main exception to this policy is when you’re trying to show a unit. I try to answer calls any time, but that’s up to you.
5.) Know When to Outsource
Many repairs can be easily fixed. Many more cannot. If you are extremely handy with construction and tools you may be tempted to do all the repairs yourself. While this might be a good idea — it also may not.
Just because you can do something doesn’t mean you should.
If your investment suite is a condo, there usually isn’t much that can go wrong except for appliance repairs or maybe a clogged drain. Don’t get trapped into replacing burnt out light bulbs.
In order to be a successful landlord, you need to balance cost savings with enjoyment. If you hate fixing things, don’t fix things. Hire it out.
The condo concierge can often recommend tradesmen who often do business in the building who you can hire for those types of jobs.
There are too many ways to make money in this world than to be trapped doing something you hate.
4.) Be Organized
Have all the forms you need organized neatly in your file cabinet, have your procedure written down for all common problems (vacancies, repairs, etc.), and keep your maintenance contacts organized neatly for easy retrieval.
Keep current with your accounting. Have a clean office. These and many other organization tools may seem small and trivial, but they are one of the most important ways you can keep your business a business that succeeds.
Don’t underestimate organization.
3.) Always Charge a Late Fee
It may seem cruel, but I always charge a late fee — and I make it known ahead of time about this policy. I don’t know how many times I’ve had a tenant call with a claim of not being able to pay the rent on time but as soon as they discover I’m going to charge them a late fee — somehow they always seem to find the money.
Most tenants make a lot more money than just what rent is — but not enough money to live each month. As such, they must constantly prioritize what gets paid and what doesn’t. By being strict with late payments, you place “rent” higher on the priority scale than other obligations.
The late fee that we can charge in Ontario is small but it makes the point.
2.) No Family / Friends
Sometimes I get a call from a friend asking if I have any place available for rent. My answer is always the same: no. Renting to family or friends is one of the most common but most disastrous mistakes many new landlords make.
I’ve rented to several close friends and even some family — each time I was faced with a choice: Get screwed over or lose the relationship. Every time I chose to get screwed over in order to preserve the relationship.
I finally had enough and “put it in the policy.” No more stress from those relationships.
1.) Don’t Be The Owner
Finally, my number one tip for being a successful landlord: try not to be ‘the owner’. This is especially true for those of you who, like me, are peacemakers and non-confrontational.
As a landlord, you are going to face a lot of tough decisions and awkward conversations. When you are the owner, the blame is on you, and as a result, you will often make decisions based on convenience rather than common sense.
Instead, from this moment on, you are no longer the owner. You are simply the property manager.
“I can’t move my 200 pound dog into this studio apartment!?”
“No, I’m sorry — the owner (or the condo building) doesn’t allow dogs here.”
Additionally, you can tell the tenant “I need to talk to the owner about this” to buy yourself time to think about odd requests. Instead of the tenant being upset with you, they are now upset with the mysterious “owner.” Feel free to play this up all you want:
Me: “Sorry, I tried talking the owner into it, but he is a stickler for the rules.”
Tenant: “Ugh, I hate that guy.”
Me: “Yeah, me too…”
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