Treats instead of Tricks

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Treats instead of Tricks

Landlords and Investors make money the same way airlines, hotels, and entertainment shows do–they keep butts in seats for as long as possible.

For real estate, this means maximizing Days of Occupancy and correspondingly minimizing Vacancy Days.

So this Fall let’s review some of the Best Practices to give your Tenants Treats instead of Tricks for their lease situation.

1. Advance Communication

The saying, “Misery is the mismatch of expectations between two people”, holds true in rentals.  If you are communicating with the tenants at the time of their initial lease signing that you’ll be recontacting them to begin discussing the possibility of renewing their lease 60-90 days before the lease ends, you’ve planted the seed early on that your not the kind of landlord who waits until the last minute for these conversations.  Good for you.

2. Review of the Market Conditions

Before you pick up that phone or begin to email your tenant, it’s time to do some reconnoitering of the rental market.

  • Has the demand for their area and home rental increased or decreased?
  • Are Days On Market (DOM) changing for better or for worse?
  • Have rental prices changed for better or for worse?
  • The data to these 3 questions will hopefullly provide you an understanding of the market forces you are up against in case the tenant decides not to renew their lease and you have to search for a new tenant.

3. Review of the Tenant Account

Ask yourself this probing question:  “Is this a Tenant I really, really want to keep in the property for another 12 months?”  Some questions on reviewing their account might include:

  1. How many Late Payments did they make?
  2. Is their pattern of paying Late a going concern for the next 12 months?  In other words, are you concerned about their ability to continue making payments?
  3. Do they make unreasonable requests on service issues or repairs?

Assuming you have reasonably informed positions on #1-3 above and you’re OK with offering the tenant a renewal option, it’s now time to get back in touch with the Tenants to begin that dialogue.

And that dialogue is the subject matter for next week’s article….

 

Until then, keep reaching for your Financial Freedom!

 

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