How to train your tenants - avoid issues, improve bottom line (ask me anything)

[Marcus Auerbach]

I thought I could share some thoughts on how we manage tenants and see what other tips and tricks investors use to run an efficient operation and get top reviews from tenants. For some context: we own and operate a portfolio of single-family homes in the Milwaukee suburbs for about 15 years (with some in-house help) and have learned a few things along the way.

The biggest shift in my career of managing tenants happened when we started treating tenants more like employees then customers. If they do something wrong, the first question is: have we trained them on this? As we all know the customer is always right. That is not the case for employees. But if they screw up it is the manager's responsibility to prevent it from happening again. And ultimately, to fire people who are not able/willing to learn. But as a manager you would never interview someone, hire them, show them their workplace and then hope that you never hear from them again. Thats kind of how most landlords treat their tenants.

So here are a few things we do:

- prevention: we actually do an onboarding training on "how to operate your house". About 50% will say that don't need it and about halfway through, they are like "wow, I did not know this". How to shut off power/water/gas, change furnace filters, lint catchers, batteries, garbage disposal, toilets (flushable wipes are actually not flushable), how to reset a GFCI and why did it pop in the first place etc etc We have a checklist for this.

- reporting: we emphasize to report problems and we always thank them first when they do. The last thing you want a tenant who does not water to "bother you" and let the sink drip into the cabinet for years.. Sometimes you have to ask 3 times before they believe you, because they have been "trained" by their former landlord to not call - or get yelled at! 

- repeat issues: we pay for the first drain unclogging, but if it was because of something they put down, they pay for the second and we will let them know at the first time. Causality is important. We charge them if it is an action they did that caused the damage. Especially, if we have trained them NOT do that action.

- annual inspections: we do that with a contractor in tow and loaded with supplies to address most common issues from touch up paint, to downspout extensions, smoke detectors, lightbulbs, exterior caulk etc - we try to fix the little things right there and come back for bigger things. We also maintain a capex list: age and condition of HVAC, water heater, the drive way, old trees  that need to be cut down etc. That goes into our long-term project list and we plan and cluster these jobs and get better prices.

- for some repeat issues we will send them a modest bill: $35 for labor, $50 trip charge, parts. Sometimes we waive the bill later, but just the fact they they have received one cuts down on the nuisance calls. This is our last resort, we use it very sparingly.

The annual inspection also serves as a training opportunity and most of the tenants get actually better with time.

Hope this is useful and what are some other tips and tricks? If you have a problem with a tenants, let's talk about it!

[Marcus Auerbach]

Quote from @Clare Pitcher:

This is so helpful!! I love the thought of educating and being respectful to the tenants. Are these all propreties you own or do you manage third party as well?

Just our own. PM for others is not an easy job, I have a lot of respect for what you guys are doing! You are between owner and tenant with sometimes opposing interests, which sometimes can be a rock and a hard place and that's not easy. Welcome Home Milwaukee is one of my top recomendations for anyone asking me for a Milwaukee PM. Please say hi to Ed from me!!