How to avoid defaulting tenants
A recent report has shown that this year 9% of SA tenants in residential properties are not paying rents at all and 28% are paying late. “The figures are not nearly so bad in portfolios which employ reputable agents,” says Tony Clarke, MD of Rawson Properties, “but they do show that additional care in the selection of tenants is now essential”.
This process, he adds, is so crucial to the landlord’s future welfare that he should be involved in the checking process. The first step should be to look at the tenant’s rental track record. This entails contacting his previous landlords and agents — and this check should go back several years. “If, for any reason, the tenant tries to limit the names and contact details of previous landlords, that in itself is a cause for suspicion,” says Clarke.
A check should also be made on the prospective tenant’s credit history. Another check which should always be carried out is with the tenant’s employer — the applicant may well be on the point of losing his job or under surveillance. In tough economic times it can be foolish to insist on the prescribed rental increases. “Tenants chosen in a hurry tend to be bad tenants, be patient and sacrifice two or three months rent. This is infinitely preferable to the expensive, long drawn-out process of getting a tenant evicted.”