If you’re planning to earn passive income for your property by renting it out, the most crucial part will be to select the tenant who’s going to live there. Online real estate platform Hoppler lists down a few tips to keep in mind to guide you to select your tenant.
Have a set of criteria
Identify your non-negotiable requirements. If the potential tenant fails to meet even just one of those qualifications, you can politely turn down his application. Considering legalities and possible property expenses – particularly repairs – in the future, it is only appropriate to determine and do what is best for you and your home. Without criteria, you could end up with a difficult tenant and your home could be at risk.
Do a background check
A call to an employer or the current and previous landlords of your prospect tenant can shed a light on the major questions you possibly have. The initial meet-and-greet might be smooth, but do not easily get contented. Take the time to find out who your potential tenant really is. Talk to his references to know his rental history and ensure that he has not walked out on a lease. If he is uneasy at the thought of a background check, move on to the next candidate. Ultimately, remember this: no background check, no keys.
Verify income
It is only apt to know the income of your potential tenant. His employment history, likewise, can indicate his career and income stability. If he changes jobs often, really think through if he can afford to pay rent. If his past landlords assert that he pays on time, he is a top candidate. Your future tenant should at least have a monthly income that is three times the cost of your asking rent price.
Take your time
Finding the right tenant for your home could take several days or weeks, but you must never feel pressured or obligated to accept the offer of a too-good-to-be-true potential tenant. Instead of selecting one on a whim, consider all the applicants and choose the person who notably meets your criteria. Do not simply settle. If your gut says there is a better tenant out there, delay your decision until you find the best one. Choose the one who is easy to deal with.
Hire a real estate broker
A real estate broker can spare you from the stress of paperwork and of finding potential tenants. From his pool of clients and through his network, he can get leads for your home. Moreover, for technical know-how such as the median rental rate in your location or real estate legalities, a broker can be of great help.
