SE­LECT­ING THE RIGHT TENANT

How do you match the right tenant with the right home or landlord – is it a sci­ence, or part in­tu­ition? How do you at­tract the best ten­ants and what is the right process for se­lec­tion? Elite Prop­erty Man­ager and Con­sole in­vited four lead­ing pro­fes­sion­als

Elite Property Manager - - Contents - Fiona McEachran

DOES YOUR AGENCY HAVE SET CRI­TE­RIA AROUND TENANT SE­LEC­TION?

Rosie: Our of­fice doesn’t have set cri­te­ria or spe­cific rules in place; how­ever, some things we look for are good ref­er­ences re­gard­ing pay­ment and looking af­ter the prop­erty. It’s also im­por­tant that the ten­ants have suf­fi­cient in­come to sup­port the rent. Tak­ing that into ac­count, we like to work on a 30 to 35 per cent ra­tio, mean­ing the rent is less than 30 to 35 per cent of their in­come.

Shann: We are in a pretty dif­fer­ent so­cio-eco­nomic area to Rosie, so we don’t ex­pe­ri­ence the same type of bad ten­ancy is­sues. We do the in­come and the track records, the ba­sic stuff, but we do want

to get to know them prior to mak­ing a se­lec­tion.

Mag­gie: Num­ber 1, that they have the abil­ity to take care of the lease and the prop­erty in terms of the rental and main­te­nance, and the size of the prop­erty.

WHAT AD­VER­TIS­ING TENDS TO DRAW IN THE BEST TEN­ANTS?

Rosie: I be­lieve a range of ad­ver­tis­ing brings in the best ten­ants, but I think that ad­ver­tis­ing through web­sites such as realestate.com.au, do­main.com.au and rent.com.au bring in a large amount of our qual­ity ten­ants.

Shann: We try and get pro­fes­sional photography and good copy. We fo­cus not only on at­tract­ing good ten­ants, but also on giving our busi­ness a good im­age.

Mag­gie: Ninety-five per cent of my listings have pro­fes­sional photos taken. It re­ally draws in the peo­ple. That ad is the first point of con­tact. Hav­ing those photos and ro­tat­ing them on a reg­u­lar ba­sis is im­por­tant, and also hav­ing a re­ally easy-toread ad. I like point form.

Sa­man­tha: Pre­sen­ta­tion is a key fac­tor: floor plans, good photos. It’s re­ally im­por­tant to present the prop­erty to at­tract the type of tenant you want. I have used stag­ing, but I think it can turn some peo­ple away be­cause it can al­most make a prop­erty look too good. You want a good tenant who feels com­fort­able liv­ing in your prop­erty, not too scared to put a dirty dish in the sink.

HOW IM­POR­TANT IS ‘THE PROCESS’ IN SE­LECT­ING TEN­ANTS?

Rosie: I think the process is ex­tremely im­por­tant to min­imise the risk of ten­ants fall­ing into ar­rears, dam­age of prop­erty and so on.

Shann: We have a cul­ture whereby a prop­erty man­ager is em­pow­ered to find qual­ity ten­ants. They know that their job’s go­ing to be a lot eas­ier, and they’re go­ing to have a strong re­la­tion­ship with their land­lords if they get that tenant se­lec­tion process right. By giving them con­trol of the tenant se­lec­tion process we’re align­ing our goals with the landlord’s.

Mag­gie: The process is ex­tremely im­por­tant, but you get a feel­ing about peo­ple as well. I’ve been do­ing this for al­most 15 years, so you do trust your in­tu­ition a bit. You talk to peo­ple at the open homes and you can gauge what they’re go­ing to be like as ten­ants. When you start hav­ing to chase peo­ple for in­for­ma­tion, that’s when I start to lose in­ter­est.

The ref­er­ences from their cur­rent prop­erty man­ager, if they have one, are very im­por­tant. Not only in get­ting the ledger from them, but also pick­ing up the phone and say­ing, ‘I’m go­ing to have a can­did con­ver­sa­tion with you about this per­son. What are they like to deal with? Are they easy-go­ing? How have the rou­tine in­spec­tions been?’

Sa­man­tha: We take de­tails and of­fer an ap­pli­ca­tion for the prop­erty. We ask you to put that ap­pli­ca­tion in, if you are in­ter­ested, as soon as pos­si­ble. You might ask for an­other look. That’s great too, but we will be work­ing on that ap­pli­ca­tion while we ar­range to show you the prop­erty again.

Then we check your ten­ancy his­tory. We talk to peo­ple if we need to, but with to­day’s pri­vacy laws I’m find­ing it a lot harder to con­firm em­ploy­ment than 10 years ago. We ask for let­ters of of­fer, your em­ploy­ment con­tract, at least three re­cent payslips to make sure that there is some form of con­tin­u­ance of in­come. If there are any ma­jor con­cerns we ask them to pay for a credit check.

WHAT ARE THE WARN­ING SIGNS OF PO­TEN­TIALLY BAD TEN­ANTS?

Rosie: Ones that come with bad ref­er­ences who are black­listed on tenant data­bases; if their tenant ledger is show­ing con­stant rental ar­rears or ter­mi­na­tion no­tices be­ing is­sued, their rou­tine in­spec­tions are show­ing dam­age to the prop­erty, and any­one with tri­bunal ap­pli­ca­tions or pro­cesses re­gard­ing ar­rears or dam­age in the past. We are sure to call all ref­er­ences that ten­ants have sup­plied on their ap­pli­ca­tion, both rental ref­er­ences, both cur­rent and pre­vi­ous em­ploy­ment his­tory and em­ploy­ment ref­er­ences, if ap­pli­ca­ble.

Shann: We don’t have a high rate of bad ten­ants in our area, but gen­er­ally we’ve found that bad ten­ants are of­ten pre­pared to pay more rent than good ten­ants. If we’ve got an over­priced prop­erty we think is sit­ting above mar­ket, we’re very wary that it may be at­tract­ing bad ten­ants who can’t com­pete with good ten­ants at mar­ket rates.

Mag­gie: I’ve men­tioned some al­ready, but peo­ple who don’t turn up to ap­point­ments or resched­ule a cou­ple of times, those you can’t reach eas­ily, with gaps in their rental ap­pli­ca­tions be­tween rental prop­er­ties. Pri­vate rental ref­er­ences can be one as well; they may have been cover­ing for a bad ref­er­ence from a pre­vi­ous agent.

Sa­man­tha: At an open, I’ll ask you to re­move your shoes. Peo­ple who refuse to re­move their shoes on a wet day au­to­mat­i­cally get a cross! (laughs)

I’m a big so­cial me­dia troll. I will look at your Facebook ac­count. Des­per­a­tion with­out rea­son is [usu­ally also bad news]… “I des­per­ately need to move this week.” “Why?” “Be­cause I just do.”

WHAT ABOUT PETS?

Mag­gie: The at­ti­tude to­wards pets has re­ally changed in the last five years, es­pe­cially in the area that I work in. There’s a lot of houses, so they’ve got yards and fam­i­lies, and with fam­i­lies come pets. I’m very pro-pet, and I try and ed­u­cate my land­lords to see that pets don’t cause that much dam­age, if any. Some­times chil­dren can cause more dam­age than a pet. As long as the pet has had a great ref­er­ence from their pre­vi­ous agent, that’s num­ber 1 for me.

I think ac­cept­ing a pet into a rental prop­erty might mean that you have the tenant for longer, be­cause it is a lit­tle bit harder to find that next prop­erty for them.

Sa­man­tha: I man­age mainly apart­ments, be­ing in an in­ner city area. I’ve been do­ing prop­erty man­age­ment on and off for 20 years; I’ve had some ten­ants who have been great with pets, but when it goes wrong it costs thou­sands, and then there’s the fleas that might hatch out of the car­pet later on. I’m a pet owner my­self, but I’m also a prop­erty owner, so I’m pretty harsh on ten­ants with pets. It’s got to be the right prop­erty.

HOW IM­POR­TANT ARE BOTH GOOGLE AND SO­CIAL ME­DIA IN TENANT SE­LEC­TION? HAVE YOU EVER SAID NO TO A TENANT BE­CAUSE OF THEIR SO­CIAL ME­DIA PRO­FILE?

Shann: We use LinkedIn, Google and Facebook. It’s re­ally easy, even for our prospec­tive ven­dors. When­ever some­one rings up – a prospec­tive landlord, ven­dor or tenant – the first thing we do is Google them and jump on LinkedIn. We see if we know some­one who might know them, or Google the his­tory about who they are. Yes, we have ruled peo­ple out by some of their so­cial me­dia pres­ence.

Mag­gie: I’ve Googled peo­ple when I haven’t had a clear in­di­ca­tion of what they do. And yes, I used Facebook once to check on some­one I wasn’t en­tirely sure of.

I’VE GOOGLED PEO­PLE WHEN I HAVEN’T HAD A CLEAR IN­DI­CA­TION OF WHAT THEY DO. AND YES, I USED FACEBOOK ONCE TO CHECK ON SOME­ONE I WASN’T EN­TIRELY SURE OF.

is a Se­nior Prop­erty Man­ager with Pro­fes­sion­als Outer Western Syd­ney

ROSIE DUNN

is a Prop­erty Man­ager with Kin­sale Prop­erty Group, St Leonards

SA­MAN­THA BER­RY­MAN

is the Prin­ci­pal of Raine & Horne Mos­man

SHANN WARNER

is a Se­nior Prop­erty Man­ager with R&W North­bridge

MAG­GIE NOSKE

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