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12 Tips for Being a Good Landlord and Having Happy Tenants

by Sharon Vornholt on August 13, 2012 · 25 comments

  
good tenants

Every landlord would like to lower the turnover in their properties. It’s costly to attract and retain good tenants, not to mention the costs you incur when they move out and you have to turn a vacant rental. It just makes good business sense to strive to have happy, long term tenants in your properties. However, that doesn’t mean that you shouldn’t have good systems in place and treat this like a business.

Here are some things you might want to consider to help turn your tenants into long term tenants.

1. It is your job to educate your tenants when they first move in. They can’t follow the rules if they don’t know the rules. Spend the extra time in the beginning on this process, and you will avoid a lot of headaches down the road.

2. When you do the walk through with a new tenant, be sure you are handing over the keys to a property that your tenant can be proud of. The quality of your rental determines the quality of your tenant.

3. Make sure the grass is cut when they move into their new home. They have enough jobs to do when they are moving, and they will really appreciate it. It also helps set the standard for what is expected of them.

4. Stay on top of repairs. Nothing makes a tenant unhappier than when repairs aren’t taken care of in a timely manner. If you don’t have your own maintenance staff, have reliable trades people that can fix problems quickly.

5. Be proactive and contact your tenants the following month after they move in. Ask them if everything is ok. It’s also a good idea to stop by periodically to change the furnace filter. By doing this you monitor the condition of your property. This type of visit is especially important the first month or two after they move in. It’s much easier to correct bad habits when they first begin.

6. Let your tenants know that they can earn “rewards”. Have a policy where they can earn rewards like a carpet cleaning or the installation of a ceiling fan for signing another 1 year lease, or for referring a tenant to your company. Make them want to stay in your property, and you will be more likely to have long term tenants.

7. Consider giving your good tenants a small gift periodically as a way to show appreciation. Something as simple as a birthday card or a $25.00 grocery store gift card around the holidays will go a long way toward having happy tenants. You can use a company like Send Out Cards that will take care of this job automatically for you. Just plug in the information such as their birthday, their lease renewal date etc. after they have signed the lease and you will be good to go.

8. For just a few dollars, you can order a roll of address labels to put in their move in packet. They probably haven’t thought of doing this and they will appreciate your thoughtfulness.

9. While you are at it, put some address labels in the packet with YOUR address on it. Make it simple for them to get the rent to you.

10. You can pick up change of address booklets at the post office. Including these in your move in packet is a nice touch.

11. Send them a welcome letter or postcard after they have moved in telling them how happy you are that they are your new tenants. Let them know once again how they can contact you in if there is a problem.

12. “Train” your tenants to pay on time. They will get the idea quickly that they have to pay on time if they immediately get a 7 day letter when they are late on the rent. It’s also not a good idea to waive late fees especially in the beginning. Why would they pay on time if it wasn’t expected of them?

As a landlord, taking care of your responsibilities quickly and efficiently benefits everyone. When you are a good landlord, this usually results in having happy tenants. Simply setting the stage for a good experience at the very beginning assures them that they have made the right decision moving into your rental. Even if you only have a couple of rentals, treat this as a business or it will quickly become an expensive hobby!

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{ 25 comments… read them below or add one }

Jason Grote August 13, 2012 at 7:57 am

Sharon, I appreciate this approach. You are basically saying “Put your best foot forward.” These little extras may cost a little more money and a little more time, but the trust you put into your tenant is extremely valuable. Nice post!

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Sharon Vornholt August 13, 2012 at 8:09 am

Jason –

I think the first step is always to take the time to get the best tenant possible; don’t just take the first person that can pay the rent. Once you have what you believe is a good tenant, it really pays off to turn them into long term tenants. It does cost a little extra money but not a whole lot. It’s really amazing how much they appreciate little things like a card or a simple telephone call. The next time you drive by your property and it looks good, just call up the tenant and thank them for taking good care of the property.

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Karen Rittenhouse August 13, 2012 at 8:01 am

Sharon: Very concise!

I like to send $25 gift cards to my tenants from the local home improvement stores. The tenants love receiving a gift and it encourages them to spend money on my property!

Thanks for your article.

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Sharon Vornholt August 13, 2012 at 8:11 am

Karen-

I agree that a gift card to a home improvement store is a great choice, because they will almost certainly use it for the property. That is so much better than a certificate to a grocery store or a restaurant.

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Paul Francis August 13, 2012 at 10:47 am

Great tips! My Degree is in Hotel Management…. our tenants are our guests and it’s important to treat them as such. The great hotels know that repeat business is so much cheaper then attracting new business and that’s what their focus is on.

Simple things such as Christmas cards and changing their air filters every couple of months goes a long, long way. Our average tenant has been in for two years with one that just passed the 4 year mark. If I would not have sold everything off back in 2005/06, I’d probably still have some of those tenants. I have a client that’s had tenants in one of their properties going on 31 years. Lol! They could get a lot more for rent on that property but since those tenants paid off the mortgage and treat the property like their own, no reason to get greedy.

Our mentality is that tenants are doing us a favor…. the horror stories I hear about “previous” landlords is atrocious and more of the norm then hearing great things. Of course, that’s why when we get great tenants…. we keep them.

Cheers!

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Sharon Vornholt August 13, 2012 at 11:55 am

Paul.

It is much cheaper indeed to keep tenants than replace them. That doesn’t mean that you should hold onto a bad tenant. I think it is all about how you approach this business.

I believe that you can treat your tenants well and let you know that you appreciate them, while treating this like the business that it is at the same time.

If you put annual small rent increases in the lease from day one and explain this to the tenant in a way that they understand your insurance, taxes etc go up regularly, then they are much more understanding when the get a small rent increase every year. And, you don’t have the problem where you look up one day and need to increase the rent by 15 or 20%.

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Jason August 13, 2012 at 11:39 am

Great tips. All very good at showing the tenant your friendly, but mean business.

I would add, be flexible. We noticed a tenant was consistently late each month. We asked why. He paycheck wasn’t until the 10th. We moved her rent due date to the 11th. She saved $80 each month and was very appreciative. As an added bonus, we get paid before she spends anything else out of her paycheck.
Do we lose out on $80 per month late fee 6-7 months out of the year, sure, but were not here to squeeze every dime out of folks. Win/win.

Jason

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Sharon Vornholt August 13, 2012 at 11:59 am

Jason-

I agree with you completely. You solved a problem for the tenant, and saved yourself a lot of grief in the process. This one act of kindness just might ensure you have a long term tenant. As an added bonus, maybe she will refer other tenants to you in the future.

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Al Williamson August 13, 2012 at 3:47 pm

Nice work Sharon. I couldn’t agree with your list more. Giving tiny tokens of appreciation to your clients (and community) goes a very long ways.

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Sharon Vornholt August 13, 2012 at 4:13 pm

Yes they do Al. Everyone likes to be appreciated.

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Trina August 14, 2012 at 5:33 am

Sharon;
I love your philosophy. I am just getting into REI, but I vividly remember what it was like to be a tenant! At the last apartment we rented before we bought a house, the elderly refrigerator had to be replaced. The new refrigerator the landlord put it didn’t even have vegetable bins: just an empty space where the bins were supposed to be! When I asked him about it, he said the bins were $50 extra and I could buy them if I wanted them. Then, when we moved out a few months afterwards to our new house, after being good tenants for him for 4 years, he said, “but I just bought you a refrigerator!” LOL — still cracks me up to think of the refrigerator that he was too cheap to buy with vegetable bins.

But back to your point: my biggest fear about being a landlord is that I will be taken advantage of. My partner and I (both women) are just too darn nice, and, especially since we’re women, I’m afraid that tenants will give us every sob story in the book. How do you balance these nice, personal touches, with a business-like attitude letting them know they can’t get away with anything??
Thanks for the great post!
Trina

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Sharon Vornholt August 14, 2012 at 6:50 am

Trina – That was a problem that I had initially. To be successful in this business without completely losing your mind, you have to “fix yourself first”.

Mike Butler who is a good friend of mine, has 100+ houses. He once told me that if I didn’t run it as a business, I would find out pretty quickly that this was an “expensive hobby”. He is absolutely right about that!.

He has written a great book called “Landlording on Autopilot”. You can find it on Amazon or the book stores. I would also recommend that you get on his mailing list. You can just google his name. He does free trainings all the time. The thing that has made Mike so successful, is that he has systems for everything.

The one thing I can tell you is that you need to have policies and pretty much stick to them. But like Jason said, if you find a case like someone that get’s their pension check on the 8th and therefore will be late every month, just change their due date to the 8th. Otherwise, you have to let folks know exactly what is expected of them in order for them to be good tenants.

I found out the hard way that a lot people will tell you sob stories monthly and they know how to “work the system”. But if your tenants know that the rent is late after a certain date, and they get a late fee and a 7 day letter immediately, they will learn pretty quickly they can’t be late without suffering the consequences. It’s your job to teach them.

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Trina August 14, 2012 at 8:48 am

Thanks again! I will definitely get the book and take a look at the website.

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Trina August 15, 2012 at 5:37 am

Thanks again for recommending the book – I checked it out of the library yesterday and I’m getting a lot out of it.

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Sharon Vornholt August 15, 2012 at 7:45 am

It’s a great book. Be sure to check out is site AskMikeButler. He always has a ton of free into there. You will also hear about his seminars and programs.

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Lolita Sheriow August 14, 2012 at 10:07 am

Great Sharon, all are wonderful tips! Karen I do the same thing, I will send a gift card and they absolutely love it! Nothing like having great tenants and as landlords we can help make them great : )

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Sharon Vornholt August 14, 2012 at 4:25 pm

Absolutely Lo. I’m sure you are a great landlord.

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Erik Hitzelberger August 19, 2012 at 9:36 pm

Sharon,

This is good advice. You have a couple ideas here that I don’t currently do, but think I will start. I just read Chris Clothier’s article about being exceptional at the basics and your blog was the perfect follow-up.

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Sharon Vornholt August 20, 2012 at 6:24 am

We were definitely thinking along the same lines Erik. It is so hard to get really good tenants, keeping them should be a priority in my book. But I also believe when you get one that is still a terrible tenant even after working with them, you just need to cut your losses and get rid of them.

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Kristie August 21, 2012 at 8:05 am

I help a couple of landlords out with their bookkeeping and/or maintenance requests. This article has some great ideas in addition to the great job they are already doing. I especially like the idea of earning rewards for behaviors that promote keeping vacancies to a minimum. Not only will this article serve as a way for me to re-enforce the great job they are already doing; but, it also gives me an opportunity to expand my services by offering to help them with some of the new ideas. Thanks for the great tips!

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Sharon Vornholt August 21, 2012 at 8:36 am

Kristie – That’s good to hear. I’m sure they would love your input. It’s really good for the bottom line when you are able to keep good tenants and turn them into long term tenants.

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Christine Valenti August 21, 2012 at 10:40 am

Hi Sharon,
Thanks for your article–I would LOVE if I had a landlord that did these things.

I’m interested in 2 things:
1. Have any of you tried rewards for tenants and if so, what kinds of incentives work best?

2. Have you thought of automated payments? I work for Rentmatic, and we automate monthly rent payments through ACH withdrawals. This would be great with your approach of being very respectful and “friendly” to the tenants, yet firm and consistent about rent deadlines.

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Sharon Vornholt August 21, 2012 at 11:14 am

Hi Christine –

I think it depends on the tenant, but most of them love gift cards from Home Depot or Lowes. On the plus side, they usually use them to improve your property. They will also buy things like hoses which they will later use to hose off the front porch etc, or they will even buy landscaping.

I have found that tenants like ceiling fans and if they don’t have one, a microwave (which can be pretty inexpensive) too. One landlord I know has a “menu” of items they can choose from. For instance, if they renew for 2 years, they would get something better than a 1 year renewal.

What they really want is to just feel special. If you can get them to renew their lease for another year or two and only spend $50-100 doing it, that sure beats the cost of turning the rental and having the vacancy while you find another tenant. The other thing is that money such as a $50.00 discount on the rent is much more easily forgotten that a microwave or ceiling fan that they look at every day.

I think the rent service is a great idea. There are probably landlords that don’t know about that.

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Marybeth August 24, 2012 at 11:23 am

Wow – I’m loving all the tips and advice I’m finding on this thread! I’m a new landlord, and I plan on increasing my number of rental properties in the future. The gift card idea is excellent! I have also purchased a copy of the book that Sharon suggested & I’m very pleased with what I’m learning. Thank you, everyone, for all the feedback here!

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Sharon Vornholt August 24, 2012 at 1:11 pm

Hi Mary Beth-

I glad you got the book. Mike spoke at our REIA last night, and he always has great info on property management. Thre is one thing that he is really a stickler for, and that is for you to never call yourself the “landlord or the owner”. You are always the “property manager” carrying out the owner’s policies.

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