Whether you just purchased your first property or your fifteenth, finding good tenants can be hard.
You need to fill your properties– and keep them filled– if you want those properties to be successful.
But you can’t let just anyone move.
You need to know that you can count on them to fulfill certain responsibilities. Such as:
- Taking care of the unit or property
- Paying their rent on time
- Handling any other obligations such as pet rent, parking, etc.
- And communicating about maintenance issues
A great tenant will handle all of their responsibilities exactly like you’d hope and expect.
A bad one will leave you with a migraine, a lawsuit, or both.
So, in the interest of your mental health and the success of your business, let’s talk about not only how to find tenants but how to find great ones.
What makes a good tenant?
First, before we talk about how to find tenants, we have to define what makes a good tenant in the first place.
We talked a bit about what a great tenant does (pays their rent on time, takes care of the property, etc.), but now let’s look at the factors that make for a good tenant.
When looking for new tenants to fill your units and properties, you’ll want tenants who have:
- Steady, long-term income
- Good credit, including a history of on-time payments
- A clean eviction history
- No criminal background
- Good references
- The ability to make a security deposit
Keep in mind that there are other things that make for a good tenant, such as clear communication, but they’re things you can’t reliably check for when taking applications, so we won’t spend time reviewing them here.
As we cover the points below, keep these things in mind.
How to find tenants: 8 Steps to find amazing tenants
Below are eight steps to help you find tenants you can count on.
Some are more important than others, but we’ll take it step-by-step to make sure we don’t miss a single important point in the process from beginning to end.
If you’re already familiar with a particular step, feel free to skip ahead at any time to pick up whatever is valuable to you.
1. Get a property management tool
If you’re unfamiliar with property management software, this might sound like an odd point to start with.
However, the reality is that the following steps with and without a good property management tool are night-and-day.
That’s because property management software is designed to help you with virtually every step involved in getting tenants and improving your tenant screening and setup process as a whole.
For example, with DoorLoop’s all-in-one property management software, you can:
- Use its automatic listing feature to– as it suggests– automatically post listings to popular property listing sites
- Manage the entire leasing and application process online
- Screen tenants right from within the app
- And offer those tenants a streamlined tenant portal to make it super easy for them to pay rent (including automated rent payments) and other monthly obligations, send in maintenance requests, and more
Finding great tenants is only the beginning.
Having a great property management tool on your side will help you improve your process, making it easier to find great tenants, get them set up faster, and making rent collection more reliable.
Keep in mind that you can go about the rest of the steps in whatever way you’d prefer. However, doing so without a good property management tool is going to be both slower and more difficult.
2. Advertise your property on listing platforms
In the past, advertising a property used to be a bit more difficult.
The methods for advertising were less straightforward and generally took more work from the landlord or property manager.
Nowadays, with property listing platforms like Zillow and Apartment List, you can easily get exposure for your property (and even automate the process with property management software).
There are a lot of these platforms online, and you’ll want to make sure to take advantage of every one (at least to make sure your property’s free public listing is updated) but here are a few of the biggest to get you started:
Still the single largest property listing platform online, Zillow is a no-brainer for the sheer weight of traffic it can help bring to your listing.
The second of the more well-known platforms on this list, Trulia drives a lot of traffic and is generally a better platform for users looking to rent.
That’s because they offer easier access to pricing per unit/property and more convenient map-based tools.
Apartment List is a rental-specific platform, so while it’s a smaller platform than the first two, traffic flowing here will be more hyper-focused.
Zumper is another great platform specific to rentals– and growing quickly.
Their app is particularly high quality, so look for it to continue to grow and potentially be a solid source of leads.
3. Host an open house
Hosting open houses is one-part marketing, one-part sales.
Open houses will bring in new leads, assuming you put up signs locally on the week of the open house.
However, an open house is also an opportunity to sell those leads that arrived from one of the above listing sites on the attractiveness of your property.
This should be done both of two ways:
- Single showings via requests you get from online platforms
- And all-day open houses
To get the most from your showings, make sure to keep a few points in mind:
- Know your policies before the showing (you need to be able to answer questions from prospects clearly and definitively if you want to attract quality tenants)
- Within this, know where you’re willing to allow some wiggle room. For example, no pets allowed may be non-negotiable, but move-in date may be flexible.
- Understand your property’s USP (unique selling points)
4. Accept applications
Accepting applications is about more than just drafting a simple sheet of paper and getting prospects to fill it out.
You need to be clear on a few things before you even begin to accept applicants.
Here are a few things to keep in mind.
Prepare good pre-screening questions
The right pre-screening questions can make all the difference when it comes to finding the right tenants.
You’ll want to think about these questions beforehand and include a handful of them on your application.
Make sure all your questions are fair and that you review those answers objectively.
Also, don’t make answers obvious. Allow room in each question by asking open-ended questions so the tenant can answer openly instead of offering a canned response based on what they think you want to hear.
Check for inconsistencies
One of the best ways to check for authenticity in answers is to look for inconsistencies or areas where the applicant may not have been 100% truthful (or simply isn’t clear themselves).
If you spot any, it’s up to you to decide if you’d like to check with that applicant to verify which piece of information is accurate or pass on them altogether.
Track and compare using a spreadsheet
A spreadsheet allows you to gather all applicant data into one central place. That’s nice for reference in general, but it’s also useful for another reason.
When it comes time to review all your applications to make a decision, this spreadsheet will make it much easier to compare applicants and make a decision objectively, as you can compare numbers without letting personal impressions get in the way.
5. Check references
Now, it’s time to talk about screening your applicants.
There are a few ways to do that:
- Run a credit check
- And a background check
- Run an eviction report
- And review at their references, which we’ll talk about here
Each of these areas is important to check off as they’ll all help improve the overall quality of your tenants.
When it comes to references, particularly look to get past landlords and employers.
These will help you not only get the most unbiased information but also the most relevant information in terms of telling you how reliable they’ll be as a tenant.
Make sure to craft your references section in a way that requires them to list past landlords or employers instead of friends and family, who are less likely to give reliable accounts of that applicant’s financial responsibility and reliability.
6. Run credit, background, and eviction checks
Next, let’s review the next three types of screening checks: credit, eviction, and background.
We’ll be combining credit and eviction, because you can typically glean evictions from a credit report (though there are some services out there that allow you to get an eviction-specific report).
For screening sake credit and evictions should be considered two different checks as a prior eviction specifically needs to be weighted heavily.
Run a credit check
For credit checks, look for things such as:
- Credit score (though this is secondary to the other factors below)
- Payment history (a history of on-time payments and as few late payments as possible)
Keep in mind that credit score isn’t the most important factor here.
Things like total credit usage are weighted most heavily on credit reports, but payment history is more important when it comes to weighing the quality of a tenant for a rental property.
Run a background check
For background checks, this is more sensitive so be sure you’re following local city and state laws.
Some areas don’t allow background checks on tenants, and some issues that show up on background checks are far less notable than others.
With that said, you’ll have to decide on your own what items are a sure-fire decline vs. which may require a call to the applicant for an explanation and consideration.
7. Have a process for deciding which applicants to approve
Now that you’ve gathered all your information, it’s finally time to decide which tenants to ultimately approve.
If you went with what we suggested earlier and created a spreadsheet to gather and track all applicants, this step is much easier.
Plus, it helps you come to a decision in an objective way without bias.
As you review your applicants, keep a few things in mind:
- Make sure you’re following all city, state, and federal laws as they pertain to tenant rights
- Compare each applicant’s information against one another as fairly as possible without considering your personal opinion about their impression if you met them in person. This isn’t a reliable way to judge financial responsibility and can lead to overlooking the facts.
- Similarly, do your best to remove your emotions from the decision process. As much as you can come to a decision using the objective information from your applications, the better.
8. Sign the lease
Whew, you made it!
If you’ve gotten this far, you’ve crossed every important step off the list and done everything you can to make sure you attract the right applicants and accept the right tenants into your units.
You’ll not only have a higher likelihood of having reliable tenants who pay rent on time, you’ll have tenants you can trust to take care of your property.
All that’s left to do now is have each party sign the lease and move your new tenants in.
When you do sit down to sign your new tenants, make sure you review a few important things to lay down the ground rules and expectations:
- Review the lease with the tenant and provide a signed copy of the lease
- Cover the property rules and tenant requirements so that tenant has a clear understanding of what is expected of them
Property management software makes finding great tenants easier
You’re all ready to get out there and start bringing in tenants.
But not just any tenant, great tenants who are more likely to pay rent on time, uphold their responsibilities, and care for your property.
While you can take these tips and implement them however you’d like, remember the usefulness of having a great property management tool.
With DoorLoop, you can not only collect automated rent payments, you can also streamline your entire leasing process online and use its convenient automatic listings feature to keep a regular flow of new applicants with less effort.
However you choose to implement these steps, use them to improve your lead generation so you have a consistent flow of new applicants and bring in high-quality tenants.
Once you receive applicants, you have to learn to manage applications, read more about that here!