Landlording & Rental Properties

The Top 10 Rental Features That Attract Cream of the Crop Tenants

Expertise: Personal Finance, Landlording & Rental Properties, Personal Development, Real Estate Investing Basics
39 Articles Written
home-showing-rental

Let me share with you the cornerstone principle of long-term real estate investing.

The success or failure of your real estate investments depends on your ability to consistently attract and retain great tenants.

In the end, it doesn't matter how great of a deal you got on the property or how strong your projected cash flow and return on investment are. Without great tenants who pay rent on time and take care of your property, the equity, cash flow, and returns all evaporate into thin air.

So the question that naturally follows is this: How do you find great tenants for your investment property?

The answer is so simple yet so powerful.

The quality of the asset you buy determines the quality of the tenant you are likely to get.

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Therefore, if you want to find excellent tenants for your investment property, you should first purchase an investment property with the qualities that attract excellent tenants.

tenant-screening

Therefore, a better question to ponder would be this: What do excellent tenants look for in a rental property?

To answer that question, I would like to provide you with the ultimate checklist for finding great investment properties—a lens you can use to filter properties, attract excellent tenants, and make more money with your real estate investments.

Fortunately, over the last decade, we have worked with hundreds of tenants on behalf of our clients. Many were “just OK” tenants, some were trouble, and some were excellent. Instead of guessing, we surveyed them and asked about what matters to them most.

The checklist you are receiving today contains the top 10 factors that excellent tenants look for in a great rental property, in order of importance.

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The Top 10 Rental Features That Attract Cream of the Crop Tenants

1. School Quality

The quality of schools zoned to the property was the primary deciding factor for over 85 percent of great tenants we interviewed. Schools are extremely important to families and single parents with school-aged children, and those tenants use this factor as an acid test.

To these prospective tenants, if schools aren’t good, it’s as if your rental property didn’t exist. Furthermore, school quality is the best predictor of neighborhood quality—something ALL great tenants seek (even those without children). Therefore, to ensure your success, only purchase properties zoned to high-performing, desirable schools.

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2. Safety

Safety is our most basic human need and a powerful motivator for excellent tenants. One of the main reasons why your prospective tenant decided to spend more to lease a home (as opposed to an apartment) is to provide a safe environment for themselves and their family. Therefore, research crime statistics and only purchase properties in safe neighborhoods.

Related: 6 Things Every Landlord Should Do to Win Over the Hearts of Tenants (A Renter’s Perspective!)

3. Move-In Ready Condition

The condition of the property—and more specifically the ability to move right in—is very important to excellent tenants. You can rent out a property that’s not quite move-in ready (requires paint, flooring, cleaning, etc.), but I assure you it won’t be to an excellent tenant.

Your target tenant plans to take care of your property and has high standards of cleanliness and maintenance. If you provide a move-in ready home, you are communicating that you share those same standards.

4. Proximity to Employment

Let’s face it, no one likes to commute! So proximity to employment centers is very important to great tenants. You can have a great, move-in ready home zoned to great schools, but it won’t matter if your tenant has to drive an hour to work each day.

As you look at potential properties, think about where your target tenants are likely to work and how close the property is to that area.

5. Upgrades

Most inexperienced investors subscribe to the myth that their investment properties just need to be “good enough for a rental.” Therefore, they purchase starter homes with cheap finishes and rent them to mediocre tenants for mediocre results.

Don’t do that; instead, purchase homes that have strategic upgrades that move the needle with excellent tenants: hardwood flooring, granite counters, stainless appliances, covered patios, etc.

6. Appliances Included

At the very beginning, your tenant incurs a large expense when leasing your property. They have to pay a month's rent for the security deposit plus the first month's rent. If your property does not include a refrigerator and a washer/dryer, the tenant would then have to purchase those items, increasing their upfront cost.

Remove the friction to make their decision easier by providing those appliances on the front end. Often your tenants won’t mind paying a little more for a property that includes all appliances.

7. Neighborhood Quality

Neighborhood quality determines lifestyle quality. Think about the community you live in—didn’t the neighborhood amenities play a major part in your decision to live there? Wouldn’t your lifestyle be different in a neighborhood with running and bike trails, lakes, community pools, tennis courts, a gym, etc.?

Quality tenants care about neighborhood quality. A community doesn’t have to have ALL those amenities, but the more the better.

real_estate_lifestyle

8. Access to Transport and Basics

Access to modes of transportation and basic necessities like grocery stores, restaurants, and shopping is very important because it affects other important factors, such as commute to work and lifestyle quality. When you’re looking at investment properties think about: how easy is it to get to the main highway/park and ride/public transportation? Are there basic services within easy reach?

Related: 5 Tips to Protect Your Vacation Property Against Renter Wear & Tear

9. Age

Here’s one thing investors and their tenants have in common: They both don’t like hassle. The main factor that determines how much hassle either will experience is the age of the property.

If you purchase older properties, they will have older systems (plumbing, electrical, HVAC) that break often, inconveniencing both you and your tenant. Purchase newer properties instead. A good rule of thumb is no older than 15 years, less than 10 if you can.

10. Rent and Price

Last but not least, your investment is ultimately a business decision for you, as well as your prospective tenant. Your tenant will be concerned with the rent, and you will be concerned with the relationship between the rent and the price you pay for the property.

Make sure the projected rent isn’t so high that it limits your tenant pool—or so low that it lowers the quality.

Which features do you make sure all your rentals include? If you are a renter or once were, do you agree with the above list? What would you add?

Leave a comment below!

Erion Shehaj helps successful professionals achieve financial independence using the Blueprint Real Estate Investing™ strategy. By combining the principles of robust financial planning with quality real estate investments, Erion shows ordinary people how to replace their salary with passive income and retire early to live life on their terms. Over his real estate career of 13+ years, Erion has helped his investor clients purchase $90M+ in real estate assets to build robust real estate portfolios and streams of passive income. In addition, Erion has been involved in successfully rolling out small multifamily new construction projects across Texas. Erion has written extensively about long term real estate investing and business in several publications like BiggerPockets (since 2013), Investing Architect, American Genius, Geek Estate and more.
    Susan Hiirsch
    Replied over 3 years ago
    Excellent list! One of my current tenants told me he’d looked at many rentals and said many were comparable in size and cost “but yours is so CLEAN we don’t want to live anywhere else!” Personally, I find it very satisfying to deep-clean my SFHs myself. And it’s gratifying to have tenants recognize your hard work!
    Nancy H. Investor from Concord, NH
    Replied over 3 years ago
    Solid article, but on the issue of building age, I think it depends on the areas in which you invest as well as the type of tenant you want to attract. I invest in older properties in A neighborhoods in central New Hampshire. People who are attracted to the area are drawn to the quality of craftsmanship and character of these properties that you simply do not find in newer homes. My tenants tend to be more educated, affluent, stable (i.e., longer-term) tenants who, for whatever reason, don’t want to own their own homes. It’s also often a lot less expensive to refinish existing surfaces to a high end in buildings that were better constructed and used better materials than today’s than it is to upgrade mediocre surfaces in newer homes. The trick is to make sure that the systems (HVAC, electric, plumbing) in these buildings have been upgraded to modern standards or that, if you’re rehabbing, you factor for those upgrades in your offer.
    Crescat
    Replied over 3 years ago
    Great article about getting good tenants, this article will be helpful for seller who are looking reliable buyers and and also for buyers who want get a great house, apartments etc.
    Margie Kohlhaas Rental Property Investor from Algona, IA
    Replied over 3 years ago
    Great article! I tend to purchase the worst home in the best neighborhood if possible. We give it a facelift (new drywall, paint, flooring, new roof) & make it one of the nicest homes. It’s amazing what a clean coat of white or neutral paint will do for a place. Laminate flooring is inexpensive and easy to install. Providing the appliances has been a plus for our tenants as well. My new idea is to install base cabinets in the kitchen with butcher block counter top. Above that is just open shelving (this saves on the cost of cabinets and provides a modern clean look). It’s rewarding to see the tenant’s reactions when they walk through a rehab after the work has been completed.
    Naomi Grebe from Manteca, CA
    Replied over 2 years ago
    This is a really great article, and so valuable to us as we explore what sort of properties we’d like to invest in. We’ve rented in different cities around the country for 10 years now, so we could move at a moment’s notice for my husband’s job. (average time per city=2 years) We are conscientious people with significant income, and I can tell you right now the #1 thing we’ve learned is that we value the rental properties we live in with as much intensity as the homeowner. If they care, and are attentive to the home and the needs that arise, so are we. They don’t care, we don’t care. We aren’t reckless or anything, but our mental investment in the care of your property is significantly less if you can’t be bothered. If anyone wants to know more about the thing we look for and care about in the executive relocation category, I’d be happy to talk about our experiences renting. 🙂
    Debbie W. from Lindenhurst, New York
    Replied over 2 years ago
    Many years ago, I was a tenant. Not as many years ago, I was searching for a home to own. I remember some of the places the realtor showed me. OMG. Your top 10 list hits all the right bullet points. We have a rental that we just filled. Our last tenants were wonderful but are leaving to bigger and better things, I hope. We gave the listing to the same realtor who found the last great tenants and Boom! great prospects. The rooms in our apt aren’t the biggest but the 2 car driveway and large up to date kitchen with tons of storage & new appliances gets plenty of respect. We had 30 people come in one day. They all said it was the nicest one they saw. We require credit & background checks. We also require 2 months security. THat means they have to have 4 months rent at lease signing bc they pay 1 month to the realtor. It has done wonders to weed out the underemployed. I listened to the lawyer podcast who said some states have crazy laws about taking security. NY is a bit crazy but not as nuts as IL. I discontinued washer access in the basement bc of problems in the past. There is a laundromat around the corner that I highly recommend. We are looking for more multifamilies and it’s articles like this that I really appreciate so TY.
    Andrew Syrios Residential Real Estate Investor from Kansas City, MO
    Replied over 2 years ago
    Very good list!
    John Murray from Portland, Oregon
    Replied over 2 years ago
    Great list. I would add time of year in which the rental is listed. It’s all about bedrooms, baths and price. People will compromise for the correct money bribe, money does talk. Most want a 2 car garage to either park their cars or their junk.
    Roderick Mills Jr. from Cincinnati, OH
    Replied almost 2 years ago
    Great article! I think including appliances is definitely a great way to attract high quality tenants and let you charge a little higher in rent because of the convenience
    Katie Rogers from Santa Barbara, California
    Replied almost 2 years ago
    Move-in ready means the appliances are already there. Appliances should be standard, and their presence should not mean the rent is a little higher.
    Account Closed
    Replied 9 days ago
    I've been searching for properties where I can invest in and found Goel Ganga Developments in Pune Maharashtra. Found all the positive points and I'm now ready to move. I've checked their website https://goelganga.in/ and got all the related information.