5 Ways To Be a Better Landlord
Some landlords get it, but many don’t. A lot of landlords are looking only to turn a profit. And to do that, tenant amenities often fall by the wayside. The thought being — why give tenants amenities?
Because the happier the tenant, the better the tenant. The better the tenant, the less likelihood of damage. The less likelihood of damage, the safer your investment is.
There is a difference between being a landlord and being a slumlord. A slumlord doesn’t care about his or her tenants. They rarely fix things and implore the tenants to just grin and bear it or find another place.
Tenants hate slumlords. They will intentionally neglect the upkeep of the unit. They may “forget” to mention a water leak. And they will generally not care right back at the slumlord when it comes to the property.
This isn’t the way you want to protect your investment. You protect your investment by being a good landlord.
Being a Good Landlord
Being a good landlord is actually caring about your tenants. Not seeing them as a paycheck but as a person. Or a family. Each tenant is different from the last and each tenant has different priorities. The more your tenant likes you, the more they will proactively take care of your property.
Being a good landlord is presenting a clean, repaired, ready-to-rent property. I can’t tell you how many times I’ve shown rental properties to clients that were not currently habitable. The landlord always said they would fix it when it got rented.
That’s not a good landlord. A good landlord turns the property over every time a tenant leaves. They touch-up paint or repaint. They check all of the appliances to make sure they are clean and in working order. They re-grout the bathroom. They check for carpet stains and replace old or fully worn carpets. They have the rental fully cleaned.
Being a good landlord gets you better tenants. More responsible. More of a caretaker for your property. Wouldn’t you rather have someone who knows you appreciate them living in your investment than someone who thinks you don’t care about anything about them other than their rent being on time?
If you use property management, being a good landlord is making sure your company is doing what they are supposed to do. Often times, this conduit between you and the tenant isn’t serving either side well. That is not how you protect your investment.
Being a good landlord is figuring out the amenities that really make a difference to tenants. Low-cost, high-value upgrades that lead to more appreciative renters and better rent rolls.
5 Ways to Be a Better Landlord Through Low-Cost, High-Value Upgrades
Owning an investment property isn’t about turning a maximum profit on the first day. Those who try to do that end up making many more repairs during the course of a tenancy because they wanted to get it rented as quickly as possible. And making repairs when tenants are present is not always an easy task.
Making money on your rental properties is about identifying the amenities that will keep the unit(s) more organized, cleaner, and easier to run. Making money on your rental properties is showing the tenant that you care about the property and its upkeep.
Some of these amenities apply more to single- and multi-family rentals, instead of apartments or condos run by an association. But landlords who own apartments eventually own other types of properties. Take this list as suggestive ways to enhance your property’s rentability and tenant stability by being a provider. By being a landlord, not a slumlord.
1. Online Rent Payment
Nothing is worse than only swinging by to see your tenants when you are collecting rent. Because when you are taking money from them, tenants are more likely to point out the things that are going wrong with the property. But there is a way to change that. With technology.
Now you can use a company like Cozy to send your tenant’s monthly rent payment directly to your bank account. Yes, there is a small transaction fee for them. But you could credit this back if they pay on-time for six months. Incentivizing your tenants is never a bad idea. As long as you always keep your word.
When you only show up on rent day, you are associated with coming to get someone’s money. If your tenants can pay online, get reminders, and manage their rental account without talking to you, you can make your property visits in the middle of the month without asking them for money.
You will have a better tenant/landlord relationship when every in-person discussion you have isn’t about rent and/or repairs. You want your tenants to be open with you about what happens at your investment property and to develop this type of relationship, you need to have a dialogue with them outside of “where is my money?”
2. Exterior Upkeep
I can’t tell you how many nice rental units I have shown in buildings or houses that look like absolute garbage on the outside. How can you expect your new tenant to take pride in the upkeep of the interior when you are ignoring the exterior of the same property?
Everyone wants to feel good when they pull up to their home. Whether it be a rental or a home that is owned, the exterior appearance is very important to the mindset of the person living there. If there is dirt all over the exterior, your tenants might take less care with the walls on the interior.
Slumlords don’t care about this. They have the mindset that they are better than their tenants and that creates a power imbalance that does not generate happy tenants.
You also don’t want to be fielding calls every day about the gutter that is falling off the front of the house. These are things you should be on top of as a landlord and thankful if alerted by a tenant. The better the relationship you have with your tenants, the more information you will receive that could prevent future issues at your property.
To be a better landlord you have to treat your property and your tenants with care. And part of the manifestation of that care can be shown every day with the exterior upkeep of the building.
3. Laundry
If you have a basement in your building or house, this is an absolute no-brainer. You can easily charge $25-$50 more a month in rent against similar units without laundry. The convenience for the tenant is astronomical.
The basement is important though. Because of the potential for leakage, overflow, or a pipe bursting, keeping the laundry in the basement is optimal in terms of minimizing potential damage to the building and/or other tenants.
Some landlords complain that when they offer laundry that tenants let friends do their laundry there. That is definitely a concern as more use equals more wear and tear and more potential for something to break. You write it into the lease and hope for the best.
In apartment buildings, landlords offset the water and unit costs by having the tenants use pay cards. You can do this in a multi-family unit as well, but I would encourage giving a certain amount of free uses a month as part of the rent. Any overage would get charged which would also prevent excessive use. If you charge though, your upgrade in rent will be minimal.
In general, units will be cleaner when tenants have the option of laundry (and a dishwasher). Clothes don’t sit around dirty and get out of control. I think a lot of landlords forget just how annoying it is to have to take your clothes to a laundromat and wait for them. It’s a huge upgrade for a tenant versus units that don’t have it. Especially for family tenants.
4. Parking & Backyard
I would never buy a property (outside of a city) without ample parking for all tenants. That is another $50/month upgrade easy, especially if street parking is difficult. I often look for properties with extra parking spaces so I can rent out those spots as well.
Every tenant needs at least one spot. If you want to dramatically reduce the number of complaints you get between tenants, I would advise clearly marking each unit’s parking spaces. Even in a small building, this will save a lot of arguments.
Hand-in-hand with parking in a lot of multi-family properties is the backyard. Sometimes you have to choose one or the other and if you do, I would always choose parking first. Parking is a rental upgrade, a nice backyard is an amenity.
For larger apartment complexes I would do everything I can to provide a community space with at least benches and tables. For smaller multi-family units I always advise clients to give each unit a private backyard space when it works.
For regular size yards, I just fence off the sections into two or three, depending on the number of units. This type of backyard adjustment can certainly add rent. Especially for couples and families. Even if space is small, having a dedicated (non-shared) backyard area makes it feel more like a home than a rental.
It also, similar to clearly marked parking, restricts the possibility of tenant disputes as to who can use the yard when. Every dispute between tenants becomes your problem so anything you can do to reduce the potential here is advisable.
5. WiFi
I am shocked that this isn’t a more common amenity provided by landlords. Sure, there is a cost, but it’s also something that can be added to the rent. Not everyone uses cable these days and you want to reduce the amount of dishes that get attached to your property. Included WiFi is something you won’t see in the comparable rental options.
Does this mean you will get a call when the WiFi goes out? Yes, and for tech-noob tenants, this might happen often. But you give them a checklist of what to do and leave one tenant in charge of the main box. It’s better for tenants than one tenant slipping onto another’s WiFi.
This is the last one on the list that I would tackle, but depending on the size of the building and configuration, it could be an amenity that brings you the best pool of potential tenants.
The Benefit of Amenities for Potential Tenants
The more amenities you provide, the more applications you will receive. The more applications you receive, the more choices you will have of tenants. I would rather have more amenities and higher rent than no amenities and the same rent as everyone else.
As a landlord, I am always looking for the most reliable tenants. The ones I will never have to worry about. The ones who pay via the portal and only call when something is really wrong. Those are the tenants you give surprise credits to for being so good.
It’s not always about the short-term. Slumlords just want money. Landlords often think too short-term because the rents pay their mortgage. But when you look at your investment as a long-term financial asset, you are more likely to make the initial repairs and add amenities that will help you develop the best relationship with your tenants. And that is what will protect your investment.
Pro Tip: The Once-a-Year Tenant Party
If you want to be a landlord who rents all of his or her properties to reliable tenants who have been recommended by another reliable tenant, you need to go the extra mile for your tenants.
Throwing a once-a-year tenant party is a great idea. Either bring a food truck or do a barbecue, but feed your tenants. Show them that you respect them and in turn, they will respect you and your investment property.
When you don’t care about your tenants, they won’t care about your property. They won’t alert you to things that are breaking. And your bills will be piling up without you even knowing.
When your tenants know you actually care, they are much more likely to take care of your property. To protect it. And to watch out for things that might not be good for it.
Disclaimer
I know all properties aren’t the same. I know that sometimes there isn’t enough available cash to fix everything. But there should be. If your budget is that tight on an investment property, you bought in too high or mismanaged the spread.
Your property should be increasing in value each year and as it does, you can feel better about the upgrades and amenities you provide. If you plan on buying more properties, your reputation as a landlord will follow you.
Good landlords get great tenants. Slumlords get tenants who hate them and don’t care about the property at all.
Which kind of landlord do you want to be?
