With mortgage repayments covered, you have more cash flow. If you’ve also built equity in the property, more cash flow means your tenants are also helping you invest in your next property.
If you’ve found tenants that pay the rent on time while they look after your asset, well done. Long term tenants are a big win toward securing your financial future.
Here are some tips on how to look after your tenants so that they prioritise renewal of their lease without hesitation.
On the go? Here’s 30 seconds of key take outs:
- Keeping good tenants for the longer term is less costly and time consuming than having to find new ones. Keeping your property maintained and in good condition with appliances in good working order will go a long way to keeping good tenants.
- If your tenants know they have an open line of communication and that they are valued and listened to, they are more likely to renew their lease.
- Your job as a property investor is to keep good paying tenants that look after your property wanting to stay. Consider offering incentives to motivate tenants to renew their lease well before the end of lease.Keep reading >>As a property investor, your job is to keep good paying tenants stoked so that they simply don’t even have the urge to move. Motivating tenants to stay put for the long term means less angst for you. Long term tenancy means you don’t even have to think about how to cover your mortgage repayments. The process of a tenancy renewal is straightforward and saves you, or your managing agent, from having to run through the whole process of finding good tenants again.So how do you influence your tenants to continue nesting in your property?
Happy tenant tip #1: Get on top of urgent maintenance issues ASAP!
Your tenants are paying you rent with an expectation that fixtures can stand up to normal wear and tear, and continue to work as expected. When it rains, your tenants expect to stay dry when inside your property. And if the shower is suddenly icy cold in the middle of winter, your tenants will be looking to you or your managing agent to prioritise fixing it, pronto. When maintenance repairs arise unexpectedly, it is your time to shine as a landlord by prioritising repairs that need urgent attention. You, or your managing agent, will need the smarts to prioritise urgent repairs from egular maintenance, and nice to haves.
#StandEasyTip: as a property investor, you need to be a good risk manager as well. Ask tenants to put maintenance requests in writing – an email is fine – and respond to them in writing so you always have an audit trail.
Happy tenant tip #2: Set realistic expectations of timeframes up-front
You, or your managing agent, should clearly define all timeframes before the tenancy agreement is signed. Including a highlighted summary in the tenancy agreement is a good idea. It means everyone knows where they stand should an issue arise.
Happy tenant tip #3: Regular inspections keep the lines of communication open
Scheduling property inspections on a regular basis opens an opportunity for your tenant to raise maintenance requests. If your tenant has confidence that the inspections take place regularly they’re less likely to be making calls about maintenance issues outside of property inspection times, unless an urgent repair comes up. Seamlessly offering these throughout the year, tells your tenant you’re professional, proactive and care about keeping the property in good condition.
#StandEasyTip: don’t schedule too many inspections. Regular inspections are great, but too many will just irritate tenants. I would recommend at two inspections a year, and no more than three a year. Your tenancy agreement and legislation will define the maximum number of inspections annually.
Happy tenant tip #4: keep rental increases small
Increasing the rent in small increments over time is a no-brainer but important. If you need to increase the rent based on your review of the market and your financial goals, don’t bump it up in one go. Giving your tenant notice of a significant rent increase is a sure way to have them online looking at other rental options rather than renewing.
If your tenants are exceptional in that they truly care for and maintain your property well, you need to weigh up whether increasing the rent is worth the risk of them re-assessing their tenancy. Perhaps rewarding them with a year or two free of increases, will be worth what you’re saving in maintenance and will encourage them to stay because you’ve reciprocated and acknowledged their goodwill.
Happy tenant tip #5: keep an open mind about pets
From my experience, small children can wreak more havoc on your property than a well behaved pet! Many respectful tenants embrace pets (and small children) as part of their household. Having a no pet policy could shrink your pool of quality tenants to choose from.
Rather than have a no pet policy, the screening conversation for pet owning tenants should focus more on the suitability of the size of the pet for the size of the property; whether the pet is indoors, outdoors or a little of both; whether there is more than one pet; and which rooms of the house the pet is currently allowed to occupy. If the pet appears to rule indoors you may want to negotiate some terms to suit – such as more frequent professional carpet cleans.
Happy tenant tip #6: if you’re happy with your tenants let them know
Your property is your tenant’s home. It is their personal space. If you’d love them to stay for the long term and you’re happy with how they are looking after your asset and paying rent, let them know. Thoughtful recognition like a personal note, a Christmas card, potted plant or hamper will show them your appreciation and make them feel welcome. An inexpensive gift of acknowledgement can go a long way. It may arrive just at the right time to put any thoughts of moving aside! Increasingly, there is a population of people that choose life-long renting over buying their own home.
Happy tenant tip #7: offer an incentive to renew the lease
If you really want your tenants to stay for the longer term, why not offer them an incentive to renew the lease a couple of months before the end of the lease? By getting in early, you’re planting the seed that you want them to stay before they start considering their options, and that it is worth their while to renew.
Some examples of lease renewal incentives could include:
- Keeping the rental payments the same for the next 12 months
- A refresh of the property such as new carpets, a fresh coat of paint or new fixtures
- Throwing in a time saving service such as three hours of yard maintenance twice a year.
Remember, the benefits of keeping good tenants are significant. It will be worth your while to entice them to renew their lease by looking after them starting from day one of the rental agreement.
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Free investor tools: 7 Key tips to keep your tenants happy PDF | Pinnacle Program Support Client Review
