For landlords, allowing a bad tenant to lease your property can be costly. Letting your property to the wrong person could result in damage to the home, unpaid rental payments and even legal action.
But by taking the time to search for the right tenant from the outset, landlords can minimize these risks and avoid any additional costs.
Ian Mwaura, Business Intelligence Manager at Lamudi, a real estate network, shares with Capital FM Business five tips of selecting the right tenant for your property.
1. If possible, meet the applicant
If you are managing the property yourself, rather than hiring a real estate agent, the rapport you have with the tenants will be crucial. If time permits, schedule face-to-face meetings with the applicants. If you live out of town, set up a phone call or insist on exchanging emails as you seek out more information about the potential tenant. Spending time on this crucial step could save you a lot of problems during the tenancy.
2. Be thorough with documentation
Request the applicant to send certain documents and be thorough in verifying them. In addition to a copy of their national identity card or passport, proof of income should be provided. A business card, employer letter or work contract should suffice. In order to ensure the tenant can afford to lease the property, the rent should not be more than about a third of their total monthly income. For extra security, homeowners can also require references from previous landlords. In Kenya, some landlords will require you to fill a form that captures more information about the tenant before a lease is issued.
3. Check their credit history
Perhaps the most important component of the screening process is verifying the prospective tenant’s credit history. This will tell you whether they have any outstanding debt, as well as whether they have a history of paying their bills on time. Even if they can afford the rent based on their current salary, they may have accumulated debt and these repayments will need to be factored into their budget. In Kenya, most banks will want to check your statements when giving a loan for a property and a copy of the title deed.
4. Look out for warning signs.
When reviewing an application, look closely at the prospective tenant’s rental history. Have they moved around a lot or do they tend to stay in a property more long term? Most landlords will be looking for a tenant who is stable and willing to stay for a longer period. A patchy rental history where the tenant has moved house frequently could be a sign of a chequered past.
5. Follow your instincts.
Even when everything seems to be in order but you feel uncomfortable renting your property to this particular individual, always listen to this gut feeling and trust your instincts before making a final decision.