In today’s crazy world, where people constantly take the piss, screening new tenants is an absolute must for landlords. Picture this crazy scene. You are a do-it-yourself landlord and decide to use one of those online agencies to list your property on the portals. The next day you manage to squeeze out a few enquiries by potential tenants. One of them arranges a viewing with you… So far so good. But at this point you still have no idea who he/she is.
For all that matters it might be a scammer, a time waster, a student turned meth lab aficionado (that will turn your living room into a meth lab), or an anti-social chap named “Ricky” who will just lynch you for the coming 2 years. Even worse, it might be a fella that just stepped out of the set of CSI. How do you know? “Aaaahh!” You say, “The more you think about those bad things, the more likely they are to happen…”. It might not happen, but it only takes ONE. Right?
As a landlord your main Modus Operandi should be PREVENTION. “Prevention is better than cure” said Erasmus. It’s not just about preventing dodgy people but also preventing time wasters. How many times have you held a viewing with tenants who didn’t qualify or couldn’t afford your place?
Your property is your business. And as with any other business, managing risk should be a primary concern. This starts from the moment you arrange a viewing all the way down to when the tenant moves out. It’s an ongoing process.
Luckily it doesn’t need to be daunting or time consuming. There are tools out there that you can use to make this process smoother. There are a set of rules you can follow. Done right, these will save you a ton of headache down the line and ensure a smooth sailing.
So how to do it effectively?
The best way to go
There are 3 golden rules for finding the right tenants and conducting viewings:
- Find out who the prospect is (pre-screening).
- Never conduct a viewing alone
- Referencing and background checks
This bring us to the art of pre-screening. Pre-screening is such an effective method:
- It ensures that you don’t waste your time arranging viewings with people who can’t afford your place.
- Depending on your house rules, it’s a great elimination mechanism for tenants that don’t qualify (pets, smokers, etc).
- You can quickly establish who the tenant is (a
Pre-screening will save you 100000000 hours over the course of your property business. You can pre-screen prospects initially by Google-ing them. Have a look around on Facebook and LinkedIn and see what dirt you can dig on them. Another way is to send them a pre-screening email. You only have to write a pre-screening email once. Then you can just copy and paste it. You can make the screening process as stringent as you want, but at this stage you should really opt for something light weight that can deter time wasters and scare of scammers.
Remember, your main goal is to ensure that you are dealing with the right calibre of tenants. You don’t want to scare them off, so don’t go asking them for bank account details or what not. Just some light weight public information that you can use for due diligence. Here is my pre-screening email, this one is bullet proof, so feel free to copy it and edit out the brackets.
Bullet proof pre-screening email
Thank you for getting in touch. In order for us to kick off the viewing, could you please come back to me with the following:
- TWO sentences about who you are and what you do.
- How long you are looking to rent the place?
- Do you have any pets? While I love these little creatures, unfortunately it’s a NO PET POLICY for this place.
- Are you a smoker? I am looking strictly for Non-Smoking tenants only!
- Links to your social profiles like LinkedIn, Facebook and Twitter. This is so I can identify that you are a genuine person and not a scammer.
If all is well, I will be holding an Open House this weekend for all the tenants interested in my property. This will give you the opportunity to view the property and ask any questions. There will be wine, soft drinks and snacks provided.
After that, if you would like to proceed, you would need to provide a holding deposit for the amount of £[one weeks rent]. This will take the property off the market, until we sort out your references. Your holding deposit is non-refundable if you choose not to continue or don’t pass referencing. But it will become part of your initial move in money.
In order to pass referencing, you need to prove that your income is at least £[rent x 2.5]/month after tax. You can still rent the property if your income is less or if you are a student. You would however need a UK based guarantor. Another option is to pay 6 months rent up front. Finally you need to provide me with a reference from your previous landlord and prove that you are legally allowed to reside in the UK for the duration of the tenancy.
The initial move in money is a 6 weeks security deposit for the amount of £[rent x 6] and one months rent £[rent x 52 / 12].
Please let me know if you have any questions.
It comes back to that question of, how do you know? It seems like the most commonsensical of the most commonsensical things you can do to ensure safety. And yet, there are still many landlords that just remain oblivious to the fact that it just takes ONE. It is already a commonly held view among people who use dating websites to meet for the first time in a public place. So how is that any different than inviting a stranger into your house? There are two ways you can go about this as a DIY landlord.
- You invite your Big uncle bobby or your mate Derick from the local rugby club.
- You hold an open house for multiple tenants to visit at the same time (still advised to invite Derick).
Holding an open house
is popular in the US, but less common in the UK. It’s not just useful for flat
sharing. You can save a ton of time by having one consolidated viewing instead
of multiple one-on-ones. You will get the opportunity to
judge compare tenants, have a chat with
them and pick the winning specimen.
Open House logistics
- You set a date that is convenient to you. If it’s a week day, make sure it’s in the evening, because good tenants have jobs. Set an end time as well, for those people who overstay their welcome.
- Buy a cheap bottle of wine or coke, some Doritos and your golden.
- Invite the tenants that pass your pre-screening.
- During the open house, be friendly and answer all their questions, but don’t become their friend.
- Pick the tenant that came across as reliable and that you had chemistry with. Rely on your gut.
It’s worth mentioning that it can be harder if not impossible to have an open house in rural areas. In that case, you should definitely invite Derick! Never conduct viewings alone.