Investing in a rental property can be one of the most exciting events of your life, but it can also be nerve-wracking. Finding the right tenant as quickly as possible is your best path to success. Before placing your first ad, it’s a good idea to list out everything you want in a tenant.
What Does The Right Tenant Look Like?
It’s critical to find someone who pays the rent on time every month and who will likely be there for the long haul. You’ll also have to decide what other duties your tenant will be responsible for. If your rental unit is a condo, this will be simple as there is very little maintenance to worry about. If your property is a single-family home, you’ll need to determine who mows the lawn and clears the snow in advance.
Are you excited and nervous about the prospect of investing in real estate? These other resources will help set you up for success:
- New Landlord Checklist
- How To Be A Millenial Landlord
- How To Leverage a Single Property To Build Your Wealth
Now that you’ve got your list of what the right tenant looks like, it’s time to begin your search. Where do you start?
Assess Your Property’s Appeal
If you want to attract the highest quality tenant possible, start by taking an honest look at your investment property. Is it in pristine condition, or could it use a few minor improvements? Think of the shape you would want the house to be in if you were trying to sell it for a profit. You would happily take the time to paint and make minor updates to attract a high-quality buyer. When searching for the right tenant, it makes sense to do the same. Your unit should be clean, warm and inviting to appeal to potential renters.
Put The Word Out
The sky-high prices of housing have left many people looking for rental units. For you, this means good news as you’ll have many potential tenants to choose from. However, you still have to get the word out that you have a unit available. Fortunately, you can advertise for minimal cost in this digital age, if not free.
Local classified ads: How you advertise depends on who you want to reach. Want to cater to the slightly older crowd? It may be worth spending a few dollars and advertising in the local newspaper.
Social media: News travels fast on Facebook, Instagram and Twitter. A few posts with pictures on social media might be all you need to find your ideal tenant. You can even post a video tour showcasing the best features of your rental. Best of all, this is a very safe and secure way to advertise. You can ask all the preliminary questions you need without ever leaving the app, thanks to the direct message capabilities.
Website advertising: A quick Google search will turn up several sites dedicated to helping landlords and tenants connect. Some are free, while others will have a nominal cost. Again, it’s a safe way to advertise and get a feel for a potential tenant without having to reveal personal details before you’re ready.
Word of mouth: If you’re well-connected, you may not have to advertise at all. You can start asking your colleagues, relatives and friends if anyone is looking for a place to rent. Word of mouth advertising is limited and may not turn up a vast pool of potentials. However, it’s a great way to start. A referral from someone you trust can alleviate a lot of the anxiety of renting your home to a stranger.
Still looking for the right investment property? You can browse our current listings here.
Set Clear Expectations From The Start
The last thing you want is a heated argument with your tenant over an expectation that should have been set before they even stepped foot inside the property.
- Will you allow pets in the home?
- Are you enforcing a strict no-smoking policy?
- Is the tenant allowed to paint?
- How many people will be living in the unit?
- Are you looking for a long-term lease, or will you offer a month-to-month agreement?
Your tenant will also have expectations from you. These are all things you want to discuss before signing a lease or rental agreement. Having clear expectations in writing will pave the way for a positive relationship with your tenant.
Don’t Judge a Book By The Cover
Once you’ve identified a handful of potential tenants, it’s time to do some research. You can get a feel for someone by browsing their online footprint, especially their social media accounts. However, it’s important not to judge a book by its cover. The young punk with purple hair, tattoos and a nose ring might be an absolute dream tenant who respects the property and always pays rent on time. The upstanding-looking man in the business suit might skip on rent, complain about everything and cause nothing but headaches.
How can you tell the difference? If they post or comment, try to get a feel for their discussions. Are they polite and respectful when talking with other people? Friending your potential tenant on social media can give you a lot of insight into their personality, but you still want to do some objective research.
- A criminal background check can protect your property and even your safety, especially if the unit is a secondary suite where you also live.
- A quick credit check will determine if they have a history of paying their bills on time.
No system is perfect, but a little due diligence today will go a long way to weeding out notoriously bad or malicious tenants.
One of the best ways to attract tenants is to tell them about the many benefits of living in the area. Here are some resources that will help:
- Relocating To Peterborough: A Case Study
- Exciting Events In Peterborough In The Spring
- The Joy Of Cycling In Peterborough And The Kawarthas
Hire a Management Company
A good management company can remove every burden from your plate, from finding the right tenant, collecting payments and making necessary repairs to the home. Some condo buildings will already have a management system. Otherwise, you’ll have to do some financial analysis to see if bringing in an outside company makes sense. If your budget allows it, working with a qualified management team gives you the benefits of being a landlord without any of the drawbacks!
Have Emergency Funds Set Aside
Real estate is one of the safest investments you can make, but it’s essential always to be prepared for the unexpected. As soon as possible, you should set aside an account with emergency funds in case your unit sits vacant longer than expected or your tenant skips a payment. Even if everything goes according to plan, a little extra money in the bank to cover unexpected expenses will give you greater peace of mind.
Are you ready to find your newest investment property in Peterborough or the Kawarthas? We have lived in the area for years and can guide you to the best places to invest. Find out more about our process or get in touch today.
