Keeping a Tenant Can Make You a Lot of Money

I’ve had a saying for decades – “I love my tenants because they are paying the mortgage on my rental asset.”  Think about it, if you have a triplex or three flat (depending on where you are in the country) with a 15-year mortgage and you have one tenant who stays for 15 years, they have, for the sake of this example, paid a third of the mortgage at the end of the 15 years. On top of that, turnover of tenants is expensive because of costs such as: vacancy period, rehab and screening, just to name a few.

So, my goal is to keep that tenant happy and continue to raise their rent in reasonable increments. What do I mean by happy and how is that achieved?  Here are a few strategies to keep your tenants happy that you or your property manager can use:

• Building a rapport with the tenant(s): Now, you don’t have to be best friends but it is important they know that people care about their well-being.  The goal is to know about an issue before it becomes a problem.  Build trust and be consistent.  I like to give them a small housewarming gift when they move in or a poinsettia at the holidays.  It’s simple but can be very effective.

• Communication is very important for good relationships: Make sure that you or your property manager are approachable.  It’s simple: return calls, texts or emails, have a great attitude, show interest in their well-being.  Also, set expectations as to how soon they can expect a return communication and stick to it.

• Exceed Expectations: You’ve heard the saying under promise and over deliver.  There are times that, as a landlord, we can forget that a lease is a two-way contract.  The tenant’s obligation is to pay rent (on time) and keep the rules of the rental unit and lease.  Your obligation is to fulfill that they have a unit that is fit to live in, safe and secure.  If your property is attractive and a pleasant environment they will be loyal and not want to leave.

• Flexible but firm: I know that sounds like an oxymoron but it really isn’t. When you have set policies, make sure the tenant is aware of them, have them sign an acknowledgment. Offer creative solutions and be flexible when you can while still making sure everything is fully documented in writing. Example:
  
  creating an alternative payment structure of the rent if they are having personal problems (but put it in writing and stick to it)
  making payments online as opposed to mailing a check

I have a partner who often gets frustrated with our tenants and says, “They think we are the ‘man’, we’re not the ‘man.’ ” Help your tenants to understand that you have responsibilities and also want them to have a decent place to live.  It really is that old saying: Win Win – they have a good place to live, you get your asset paid for and cared for.

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