Finding The Best Tenant for You: How to Screen Tenants

Warning signs to avoid and 5 questions reference checking – get it right!

The best protection we can give ourselves as landlords is choosing the right tenant. Easy to say. Here are a few warning behaviours for possibly ‘bad’ tenants and 5 questions to ask referees that will get the answers you need.

Warning Signs

Excessive Haggling

If the tenant is not excited, able and willing to pay rent to live in your property, they are not the right tenant. Such behaviour will make a landlord-tenant relationship hardwork and you can assume bond deductions –no matter how fair – will be a struggle.

Loud

If prospective tenants pull up in a large, loud car with blaring music at the inspection, or are just generally loud people – you can assume this will continue inside the house. How near are the neighbours and do they have your number?…

Application

If the timeline of jobs and past living situations is not quite adding up, you might be best to just move on. In a big city like Auckland, there are always more tenants. Vacancy is always the better and cheaper option than a bad tenant.

Numbers

If you have advertised for a maximum of 3 people and a group of more than 3 show up just say no. You wouldn’t believe how many times I have had groups of 4 – 5 people looking at studio or one bed apartments. (A comment on the expense of our city sure, but I’ve yet to run into a Landlord -or body corp- OK with more than 3 people in a studio apartment)When I explain the maximum is 2, they say “ok – the others will go somewhere else” likely story…

Verification

Supplying payslips or bank balance/statements can be embarrassing but don’t let the tenant bully or intimidate you into accepting them without at least some proof of their ability to make rent. All tenants should be aware this is necessary no matter where they go. If they kick up a fuss, just move on – you don’t want a tenant like that.

There a host more warning signs to be on the lookout for.

Once applications start rolling in, the real work begins.

Below are 5 great questions for previous landlords to help you discern if this applicant, who looks great on paper – is as great in person and will still be great down the track when inevitable bumps are struck?

Questions you should be asking previous and current landlords:

1. Ask about relationship

How does the referee know your applicant?

Is the referee someone who can be objective? How long have they known the applicant?

2. Ask about Living situation

Where is the applicant currently living? Why are they leaving? Do they have any pets? Do they smoke?

3. Ask about Tenancy History

When was the last inspection and what state was the property in? Has there ever been any damage to the property or chattels? Have you ever needed to issue a breach notice?

4. Ask about Finances

What rent was the tenant paying? Were they ever late to pay?

5. Ask about Personality

Would you say the applicant is honest, reliable, trustworthy? Would you rent to them again?

From these questions you want to be verifying what is on the application form and what you have been speaking about with the applicant in any prior interviews.

If anything doesn’t add up keep pressing. While it could be an honest mistake – you are going to be legally contracted to have this person living in your property and it is not an easy or quick thing to get a bad tenant out.

This conversation should boil down to a fairly quick conversation over the phone. Don’t be tempted to rush, get what you need to hear from referees and trust your instincts. A few more days of vacancy to find another applicant is far preferable to a poor tenant causing stress and damage.

If you aren’t confident enough to tactfully turn them away, or to spot these signs yourself, hire someone to do this for you. The best processes in the world won’t save you from the stress of a bad tenant. Tenant Source find tenants for independent property investors like you. Check out our website for more on our services.

Disclaimer: The information contained in this publication is exclusively for promotional purposes and is not to be relied upon for legal or contractual dealings. Tenant Source recommends you seek independent legal advice, and that you may need to seek technical or other advice and information prior to making any actions in regards to tenancies in your investment properties. Tenant Source Ltd including its staff and directors accepts no responsibility for any issues arising as a result of taking advice from this publication.