We’ve all heard horror stories about the tenants from hell, haven’t we? But have you ever heard a story about a good tenant? Of course not.
This doesn’t mean they’re not out there. In fact, they make up the vast majority of housing tenants nationwide. It’s just that sometimes, we can take them for granted.
Every investor faces the tightrope-act of wanting to make sure they’re squeezing every last possible cent of their property, while trying to keep their good tenants from flying the coop.
Here are some quick tips I’ve picked up over the years to help strike the right balance.
Do your research
Always keep one finger on the pulse of your local market, and make sure the rent you’re charging is in line with current market value.
What would you pay?
If you decide the time is right for a rent adjustment, even if you currently have tenants inhabiting the property, put yourself in the shoes of a prospective tenant viewing the property for the first time. How much would you pay? Be honest!
The little things go a long way when it comes to the landlord-tenant relationship. Make sure you’re constantly maintaining the property and responding in a timely manner to their concerns. This will make them feel they have a voice and are being appreciated. Also, be sure to explain why you’re changing the rental price.
If you’re going to change the rental price on your tenants, I can’t stress this one enough. Give notice early and give it often. Allow your tenants time to make a decision on whether they will stay or go.
Consider your tactics
If you do decide to raise your rental price, it may be worth thinking about how you plan to do this. While it will be rarely be a welcome surprise for a tenant, there are ways for a landlord to manage this process that can cushion the blow and even curry favour with the tenant.
- Consider small, more frequent increases in rental price than a single, large increase. The shock of the bigger on-off may spook your tenant into leaving
- If you want to raise your rent by $25 a week, inform your tenant that you plan to raise it by $50. Then, once a week or two has passed, contact them again claiming a ‘change of heart’ and let them know the price will only go up by $25. Ensure that your tenants know this change of heart was brought on by your appreciation for them.
It’s easy to think when you begin investing that it’s all going to be about cashing checks and watching prices rise, but if you discount the very personal side of being a landlord, you may find yourself with some empty properties.
The Greater have been helping customers build their investment property portfolio for over 70 years, so we like to consider ourselves the experts when it comes to bricks and mortar. If you’re looking to invest or expand, why not check out our range of great value Home Loans, or start a conversation with a Greater lender today.
Or, if you’re not quite ready to take that leap and just want some more information, check out our guide to property investment. We break this complex subject down into easy to follow steps.
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