Approximately 30.9% of people in Australia live in rented accommodation (Domain 2016), but that doesn’t mean all of them will be suitable for your investment property. In fact, there may only be a handful who treat your house with respect and pay their rent on time. To ensure you select the right tenants, you need to thoroughly and carefully screen all applicants. Here are our top tips for effective tenant screening:
Market your property properly to ensure you have a choice of tenants
If you only get one person applying to rent out your property, screening will be of little use. To ensure you attract a number of possible renters, market your house or flat effectively. This means highlighting your property’s strengths, setting rent at a reasonable level, and using the right channels (online property websites, direct marketing or the local press). If you get this right, you’ll have plenty of interested parties as well as the power to choose a suitable applicant.
Start screening straight away
Good tenant screening involves more than merely checking rental history and income levels; you need to understand their character as well. When potential tenants are viewing your property, learn as much about them as possible. With a short informal chat, you’ll get to know the kind of person they are, how often they move, and how their job is going. It’s also worthwhile trying to find out if they’ve ever had any issues with previous landlords.
Increase your cashflow by self-managing your property.
Ask for ID and proof of income
To ensure the applicants are who they say they are, request to see their IDs and proof of income. Not only will you be able to avoid tenants with the wrong intentions, but you’ll also uncover those who may have had trouble renting in the past due to serious disputes or issues with making payments on time.
Check their references
Checking references is one of the most important aspects of tenant screening. It’s the best way to find out more about their rental history and the stability of their income. Get in touch with the tenant’s previous property manager and current employer to validate their good rental background and future job prospects. You don’t want a tenant who has failed to pay rent on time in the past or someone who is facing unemployment in the next six months.
Use the National Tenancy Database
Finally, once you’ve settled on an applicant, make sure you check the National Tenancy Database. If they’ve ever had any serious disputes with old landlords or if they’ve ever been to court, you’ll be able to find out. You can do a quick tenant screening for only $25 on Lodge.
For more advice on tenant screening or investment property management, contact us at Lodge today.