Tenants you should look for when leasing a property
Finding the right tenant is a great investment – it’ll save you money, reduce stress and help maintain the value of your property.
What should you look for in a prospective tenant? We sat down with DT Property owner, David Traeger, who, as an investor himself, has some tried and tested tips for finding the ideal tenant.
“I think it’s really important to preface this discussion with a disclaimer that there’s no hard and fast rules about who will make an excellent tenant. While I will make some recommendations, at the end of day, you have to judge these things on a case by case basis.”
Long term tenants are the best tenants
Generally speaking, you will want tenants that will lease your property for a longer period – the reason for this is mainly economical – you’ll pay less re-letting fees and reduce the risk of lost revenue from the property remaining vacant. However, it also has the added benefit of reducing time and energy you have to put into the property – no one wants to be selecting new tenants every 6-12 months.
But what tenants have the best potential for staying for years on end? This is what David had to say.
“Most landlords are looking for long term tenants. I find that the types of people who fit into this category best are families and couples expecting a child. People with pets can also work well, because they are less likely to move.”
History is important
Property managers are able to search the tenancy database for people who apply for a rental to see if there have had any issues in the past, including late payments and damage to the property. David had this to say about the database:
“There is only three years’ worth of rental history on the tenancy database. If a perspective tenant has some negative incidents on there, I would be very reluctant to accept them for a property and recommend my landlords to pick another candidate. It’s simply not worth the risk.”
Stability is a great attribute
One of the key ways to ensuring you’re getting return on your investment is reducing the rate of vacancy for your property. This can be done by choosing a candidate that has a stable history. Do they change addresses and jobs frequently? They might not be the right choice for you as history often has a habit of repeating itself.
“One of the reasons I have recommended families is that their situation is generally a bit more stable,” David said. “They are less likely to move or change jobs, which means there is a higher probability that they won’t spontaneously leave and make you start your search for a tenant over from scratch.”
While anyone has the capacity to be a great tenant, the candidates mentioned above are considered to be ‘safe bets’ according to the owner of DT Property, David Traeger.