I ask two things of my tenants: to pay the rent on time and to treat the house with care. Before they move into a property I let them know the importance I place on these two things. I tell them that my “supervisors” are very strict and will evict people in a heartbeat who don’t pay their rent.
I even make tenants sign an additional document besides the lease, called “Company Payment Policy”. This one-page document states in plain writing that my company has ZERO-TOLERANCE for non-payment of rent. I’ve never had a problem getting anyone to sign this, and obviously if someone refused, that’s not the type of person you would want in your property anyway.
Once I get a quality tenant into one of my properties, what do I do?
Treat them like gold because they are paying me thousands of dollars a year. I do everything I can to make my tenants happy so that they stay with me for years. I send them birthday cards, Christmas cards and I give them gift certificates when they renew their leases with me.
Well, last week I had a tenant of five years move out of one of my properties. Having someone stay for five years is awesome in this business because one of the biggest expenses is tenant turnover… because of the vacancy costs and any repairs you might have to do to get the property ready for a new tenant.
Guess what? I didn’t have a vacancy with this property.
Whenever one of my tenants notifies me they are going to move I immediately ask if they have any friends who might want to rent the property, which is exactly what I did with this tenant of five years. He happened to have a friend who lived down the road who was looking to move because of mold problems in her property.
I had his friend fill out an application, my assistant Lisa processed the application, and everything came back good. I ended up moving my old tenant out the same weekend that I moved my new tenant in. Also, the previous tenant ended up cleaning the place and doing some painting so I didn’t have to do any repairs at all.
Now, besides the fact that I didn’t have any vacancy, guess what the other benefit of referrals is?
That “birds of a feather flock together.” We tend to hang around people who are like us. The rich hang out with the rich, the poor with the poor. The drug addicts with the drug addicts, etc.
So, if you have a great tenant and they refer someone to you, then most likely their friend will also be a good tenant too (you will still of course screen the heck out them).
Anyway, to reduce your vacancies and to have your tenants occupy a property for several years in a row, take good care of them… as long as they are paying the rent on time and treating the house with care.