How Can Landlords Attract and Retain Good Tenants?fjpinvestment
A big part of landlords making a success of their buy-to-let property investment is to attract good tenants and retain them. If your investment strategy is principally focused on rental yield, then having good tenants is the lifeblood of your long-term investment. Finding the best tenants to occupy your property is one part of the equation, the other is making them happy once you have them.
There’s no one magic thing to achieve this important task. In fact, it involves many things all working synergistically: a package of good decisions and positive actions.
Renters have changed over the years and today’s renters are changing still. “Smart” and green properties are high up on the agenda for many seeking a temporary home. Their rental home, in other words, needs to reflect their world view: – smart, green, modern, and flexible. As world leaders meet in Scotland for COP26 to drive home the importance of living in harmony with the environment, and with the changing working patterns due to the pandemic, landlords can leverage change and maximise their rental income by paving the way to attract the best tenants.
According to a Wise Living survey of over 1,000 renters living across the UK, tenants are willing to pay up to 10% more in rent for a home with smart features. With the average UK rent being £982 per month (outside London), a home with smart features could push rental yields up to an extra £1,178 per year.
Clearly, more and more tenants are looking forward to and demanding high-tech rental properties to suit their needs. For landlords that neglect this growing trend in smart homes, they could be missing out on a significant chunk of the tenant pool out there. It’s true to say that the average age of renters is going up, but it is equally true that renting predominantly attracts a younger demographic; a demographic that has grown up with smart phones and tablets.
Renting families, too, can be offered smart technology features like smart locks, windows, and thermostats. Having broadband and fast internet speeds in the area is something that many tenets will definitely want to know about.
Green means go
Going green is on everyone’s mind these days. The same Wise Living survey reveals that nearly 70% of tenants express concern for the environment and want to do their part in mitigating human impact. Smart technology plays a part in this, such as with smart thermostats that help regulate temperature and prevent energy (and money) wastage, with a swipe of the phone.
Improving the green status of your property will yield a higher rating on your Energy Performance Certificate (EPC), which is required to be given to all tenants. A higher EPC rating will help attract tenants that care about the environment, and caring tenants is what you need!
Flexibility in space and time
Despite the title, this is not a physics lesson in the properties of space and time, aka spacetime.
Flexibility in space
60% of tenants are looking for flexible space in their home. Home offices and remote working are more important than ever, and a separate room or extra space for this purpose will be very attractive to tenants. Having knowledge of what tenants are looking for, landlords can advertise any additional spaces for home working as a huge selling point, even for prospective tenants that haven’t considered it who then have a light bulb moment.
Flexibility in time
As you can appreciate, many potential renters will only be able to view your property at the weekend or after work, so being flexible on when you are able to meet them and fit around their schedule is a good idea. This will also give you the opportunity to meet and be better acquainted with them and ask questions. For one thing, if they are considerably late for their appointment with you, it will make you wonder what else they will be late for.
Have a tenant criteria in mind
To help focus in on what tenant market you are targeting, give some thought as to what kind of tenant you want to attract.
Furthermore, have a list of questions that you want to ask potential renters and apply them equally across the board to protect against accusations of discrimination. Such questions can relate to:
- Future intentions
- Hobbies and interests
Draft a captivating listing
Most tenants looking for a place to rent will use an internet listing service to help find the right place. So, by writing a captivating listing, focused on the type of tenant that you are looking for, is an important first step in attracting quality tenants. Writing an effective listing will be instrumental in attracting good tenants, and consideration of the following points will help guide the draft:
- Is your headline worded in a way to pique the interest of the type of tenants you want?
- Does your listing contain the relevant information tenants will need?
- Have you included high selling points like smart technology features?
- Have you made it easy and inviting for the tenant to contact you?
Pictures paint a thousand words. There’s a reason why large corporations spend a lot of money on attractive and compelling packaging and advertising: they want to inculcate a positive emotional response. Imagery is very important in this respect; they are the tenant’s window to your property. Likewise, use quality images to help attract quality tenants.
Quality images are also good at holding someone’s attention. As noted in the WSJ, listings that don’t have any images will only have a few seconds to hold someone’s attention, while those that do have images will have about 20 seconds. And of course, more than one quality image is even better!
“If you’ve got it, then flaunt it!” said Jamie Johnson, CEO of FJP Investment. Jamie continues: “If your property has amazing features that would entice the most discerning tenant, hire the best photographer in town and snap away. Don’t hide away that spacious living room with high ceilings and art deco furniture, show it off in its full glory. ” Quite right.
Keep up with the maintenance
Keeping up with regular maintenance is another way that will help you to attract good tenants. Treat the property as you would expect the tenants to treat it: with lots of TLC.
Regular maintenance will also save money in the long-term because it will help prevent deterioration and damage. Furthermore, it will mean less work to do when it comes to showing tenants around because the property is already in tip top condition.
And here is another little gem from Jamie Johnson of FJP Investment: “There is also a psychological reason why keeping on top of regular maintenance is very important. How you treat your property will reflect on your attitude towards your investment and, in turn, will affect the tenant’s attitude towards your property. If you are sloppy or neglectful with regular maintenance, you are more likely to be the same with managing the financial aspect of your investment. One can too easily lead to the other and, before you know it, you have taken your eye off the ball and you could find yourself in hot financial water. ”
It will take time and resources to resolve an issue with unfavourable or difficult tenants in your property. Competent screening can help prevent a headache down the line. By at least making sure you have the basics covered, you can significantly reduce the likelihood of this happening:
- Do background checks on the tenant, including credit scoring and income level. A tenant too close to their budget might not end up saying very long.
- Speak with the tenant’s previous landlord if possible. Also, speak with their references and ask them questions. Ask questions like: Would you allow them to rent from you again? The answer to this one question speaks volumes.
- It doesn’t have to take long, but meeting face-to-face with the tenant and asking them questions is a must. Body language and appearance are just as important as the answers they give. The more you do this, the more you will realise how true this is.
Provide some extras
Quality tenants with a higher income will appreciate the extras that you can provide and may even be the thing that swings their decision to rent with you and not a competitor. Extras can be many things and include built-in wardrobes, air conditioning, smart technology, dishwashers, and storage or office space.
Sure, they will cost you. But they will also help attract good tenants who are willing to pay a higher rent.
Know your area well
Tenants will want to know about the amenities in the vicinity of your property. Indeed, they will have played a part in choosing your location for the buy-to-let investment. Highlight details such as:
- Public transport
- Schools and universities
- Shops and cafes
- Parks and recreational areas
- Gyms, wellbeing, and sporting facilities
- Historical interests like castles and museums
- Cultural interests like music halls, theatres, and art galleries
When tenants are made aware of all the amazing amenities in the area of the property, it will help them envision what life could be like living in this area, and it will help them form an emotional attachment to your property.
Treat previous tenants with respect
There is probably no better advertisement and marketing tool than word of mouth. People talk. Good and bad, people will hear about you and take notice. Your reputation will precede you.
Think like a business professional and entrepreneur, and your tenants as customers. They pay you good money for a service which you supply: a nice home to live in. When you think like this, what to do for your customers will become clearer.
Remember, tenants talk to each other, and landlords often find good tenants this way: recommendations. If you want quality tenets, become a quality landlord.