Talk to any landlord on Planet Earth and they will be able to tell you virtually endless stories of bad tenants, the horrors that were done at their apartment, and how much time and money it cost them.
There seems to be no end to renters who do not respect the property, the rules, or even other tenants on the property. They cost the landlord time, money, hassle, and no small amount of gray hairs.
Unfortunately, all the costs that these bad tenants give the landlord are passed on to other tenants in higher rents, higher security deposits, and tighter restrictions on the rules and regulations that govern the apartment complex. This makes life more complicated and cumbersome for everyone.
And all landlords want the perfect tenants, so, what is the solution to this never-ending problem?
How Do You Protect Yourself From Bad Tenants?
The very first thing you need to do is commit to changing those things at your complex that is either attracting these bad tenants or allowing them to use and abuse your property at will.
Without the personal will to make your apartment complex into something better than what it is now, change is not going to happen. You must be willing to make the changes and go through a potentially tough transition period to make your complex someplace that great tenants want to go to.
A primary step in this is to make sure that your advertisement is top-notch. Bad tenants haven’t just been bad at your complex. They are typically not one-off offenders. They bounce from place to place, causing damage that would make the Mayhem Man blush. You need to make sure that they are not attracted to your place as an easy target.
Poor tenants are looking for a landlord who is not going to do the extra steps that would out them as a bad tenant. They are looking for the smaller complex and the easygoing landlord who doesn’t take the time or take the steps necessary to disqualify them from ever applying in the first place.
For starters, the ad for your complex means advertising in places that high-quality renters would look. This means having good pictures, descriptions and being thorough, especially online. It also means making sure the units you have available for rent are updated and that you put in your ad that you screen tenants.
Additionally, in your ad, you need to make sure you have the rent priced right. Landlords are continually trying to achieve 100% occupancy at their complex. Obviously, this is the end goal, but charging $50 a month just to get anyone and their dog into your place just to be full isn’t worth it at all. In fact, you may cause yourself more long-term damage by underpricing the unit than if you would appropriately price your apartments.
A justifiably higher price attracts a higher quality tenant. Tenants that are willing to pay more for their unit are not going to want to be around problem tenants. These bad tenants tend to look for a cheaper alternative to renting as they are bouncing from place to place. You need to make sure you price these poor tenants out of your market for rent.
This doesn’t mean you discriminate against people that don’t make as much money, it just means that you price your units at a price that attracts those people who have the lowest risk and highest stability for your business.
How Do Landlords Choose Between Tenants?
The most important thing you need to do to see change at your complex is putting your tenants through background checks and credit checks. Almost half of all landlords do not take this step for whatever reasons, and because of this, they are inviting more problems than they need to.
Background checks allow a landlord to see if there has been any criminal history in recent years of any of the people that are going to be on the lease. Weeding out these bad apples are huge in renting to responsible tenants. There are plenty of places online that you can send your applicants to that will perform these checks for you.
A credit check is also a must. Usually, on the application for an apartment, there is a place for the tenant to put down how much money they make a year. This is important, but it is also important to run the credit check.
If a tenant has a bunch of accounts that are overdue and they have collections coming after them, then after they move in, they may give you the first couple month’s rent, and not much more after that and you are going to be holding the bag.
You can quickly decide whether the applicants are a good risk to rent to or not.
The other aspect of this check is that it makes it another hurdle for the tenants to jump through. Now normally, having your customers jump through hoops isn’t a good business strategy to get more sales. But in this case, it is a bit different.
The credit and background checks are going to cost some money, usually somewhere between $25-$50. Bad tenants are not going to pay that money, knowing what the report is going to show the landlord.
Serious tenants, however, are going to be happy to go through this check because they know if they are going through it at the complex, so is everyone else. This gives them assurance that the other tenants at the complex have a higher chance of being good tenants as well.
On-site Management is also something that bad tenants tend to avoid. They know that if someone is around all the time watching the place, doing repairs, maintenance, and upkeep, it is going to be much more difficult to pull off the shenanigans that define poor tenants.
Now, not every complex is large enough or can afford on-site management. This means a bit more proactive approach is needed by you as the landlord. Let the tenants know that you are running a business, and that is how you are going to treat any situation that arises. You always have the leeway to make allowances, but it is always easier to give a tenant a pass than make the rules stricter once they are already renting.
How To Deal With Difficult Tenants?
Dealing with difficult tenants is just that… difficult. They can be emotionally charged at times, and after a while, you yourself can fall into the trap of bringing emotion into the situation. It is not easy separating the business aspect of a problem with the business nature of the issue. Everyone is human and we all have emotions.
For a landlord, this is their property and livelihood. It can seem impossible to separate these two things and stay objective with someone who is giving you grief.
Put all your prospective tenants through background checks and credit checks, this is going to weed out more bad tenants than you will ever see apply just by making that mandatory.
Make sure your advertisements are in good shape and are posted and listed in the places where high-quality landlords are advertising. And make sure when you do list a new apartment, that the price is competitive to other apartments around the area. Simply throwing someone in to make sure you don’t have a vacancy is a sure way to lose money.
We at Apartment School, we have written a great guide for any landlord who is dealing with difficult tenants. Check it out to see all the things you should and shouldn’t do if you are already renting to a difficult tenant. Once you are able to effectively deal with the bad tenants you already have at your complex, you can be on your way to attracting the right kind of renter.
