Rental Property Success: Tenant Management

The success of your rental property really comes down to 3 things: the condition of your property, the property manager and the tenant. Typically, you will have 100% control over the first 2 (the condition and property manager). How well you maintain your property or the level of rehab you do on the front end is up to the owner. As well as, the property owner has control of firing the manager at any time if the property manager ends up being a dud. However, Property owners do not have much control over the 3rd component because it’s difficult to select great tenants. Speaking from 11 years of experience, a tenant with a near-perfect profile (in regards to credit, rental and job history, income, etc.) and appears completely normal during the application process can turn out to be a total whack job.

So your tenant has signed the lease and moved into your home, what can you do to manage your tenant? One way is to order a property inspection from your Property Manager. Most managers offer some sort of all-inclusive service for a fee where they will enter the property and do a complete report on the condition of your home. We suggest doing this around Month 3 of the tenant moving into your property. Ordering the inspection at this point will give you a quick snapshot of the tenant’s living conditions and how well they are taking care of your investment. Typically an individual who is hard on their home, doesn’t maintain the grounds, and an all-around slob will do so from the start. The reason to wait until 3 months of occupancy is so you can start to see the beginning of more than just a messy tenant. You will begin to see conditions such as blinds being torn or dirty, dirty walls, kitchen grease behind the stove, nasty appliances, debris in the yard, dust accumulating on the fan blades, dirty bath tubs, above-average wear and tear on your carpet and torn window screens, just to name a few. Also, the tenant should have already swapped the filter at this point, especially in the summer time when AC units tend to work hard and run more than the colder months.

A property inspection can identify this type of tenant living in your home thus allowing your property manager to be proactive by letting the tenant know this type of wear and tear on their home is unacceptable and remind them they are fiscally responsible for the condition of their home. If your Property Manager sees this happening, they can make necessary repairs and charge these back to the tenant; if the tenant does not like it, they can move if they wish by paying a lease-break fee. Basically you can treat the tenant like one would their child by staying on them to make sure the house is being cared for. After the property inspection, simple drive by’s can be performed to make sure the yard is being maintained. Ordinary maintaining is more than just cutting the yard, but also trimming bushes, keeping growth off the home, cleaning roofs and gutters, along with keeping debris out of the yard. While this strategy is not guaranteed to achieve the results you most desire, it certainly is better than not doing anything at all and being shocked when the tenant moves out. What it can do is help you with your decision about whether or not you want to renew the lease and not allow the tenants to continue putting above-average wear and tear on your home. We have seen these initiatives work, but some tenants are what they are and will never have pride in their home or respect that they are living in someone else’s investment. When the lease expires, you will want to evaluate the cost of a higher than average rent ready and vacancy versus allowing your tenant to continue living in your home.

Bottom line, does the property inspection fix a tenant who is hard on your home? No.
Can it help in better management and overall damage control? Yes, and we have seen that work.