“It doesn’t matter what I do, I always end up with bad tenants,” says the landlord while surveying the damage done by his umpteenth tenant from hell, and wondering how he’s going to pay for it. The tenant hadn’t paid rent for four months.
“I don’t need any of those rental applications or credit reports. I’ve been a landlord for over 30 years and I rent on ‘gut feeling.'” He’s dodged a few bullets when his “gut feeling” told him the tenants who didn’t send up any red flags when he interviewed them moved out in the middle of the night before the sheriff arrived to bounce them.
What kind of a business are you running? Or is it a business? Landlords who can’t be bothered with businesslike procedures or who just assume they will become victims once again every time they rent, don’t think of the rental property business as a business. Maybe they think they are put on this earth to provide housing for the first warm body who shows up with money, or almost enough money. Maybe they think they don’t have enough aggravation in their lives and owning and managing rental property provides them with the stress they are missing elsewhere. We can only speculate.
Seat-of-the-pants rental property management may have allowed for simple recovery from bad tenants 30 years ago. That was in the days before tenant-friendly landlord-tenant laws and landlord-hating judges. In the days when the “gut feeling” landlord began his life of stress, you could simply change the locks and move the tenant’s possessions out on the curb. Let ‘em complain, who’s going to do anything about it?
Today self-help evictions will earn you big fines and the tenant rent-free living for months.
Bad tenants are not inevitable. I estimate that at least 95 percent of tenants are on the good side of the ledger. You just don’t remember them as well as the bad ones. If the majority of a landlord’s tenants are bad, he is sending out some kind of signal that tells the bad tenants he is an easy mark. It could be the look of his property or could be his wimpy attitude.
Bad tenants are easily weeded out with carefully constructed rental policies and standards and by insisting that every tenant must meet those standards if they are to have the privilege of living in your property.
Gut feeling is turned to mush by the bad tenant who knows all the interviewing tricks. They are really good at seeming to be the nicest people on earth. They have just had a little bad luck here and there (none of which was their fault, by the way). They know all the interviewing tricks because they have a lot of practice–they move a lot.
First, we must think of what we do as a business. We must treat it like one and take special care of our properties and who rents from us.
Second, honor our investments. If we honor them, we look at them in an entirely different light, a light that says they are important and we will do whatever we need to do to make sure they provide us with the return we demand. Treating them with lack of honor is telling yourself you don’t deserve them, and that leads to haphazard tenant selection and maintenance.
Inevitable bad tenants? Renting on gut feeling? Don’t be silly. Make sure your business and your investments are working for you.
