As overseers of numerous rental properties, property management companies interact with hundreds of prospective tenants on a daily basis. As the owner of the property, the same also holds true if you are managing it yourself without professional help. The difference is that there is a higher risk that you will rent to a bad tenant compared to the caliber of individuals that property managers approve for their rental properties. The bottom line is that being your own landlord is not for everybody.
The Ideal Tenant
Unlike real estate owner/investors, property management companies are highly skilled at attracting better tenants for their client’s rentals. They take careful steps to not only ensure that your property is rented to good tenants; they also know how to retain them so they keep renewing their lease.
So how do you determine if a tenant is a good choice for your rental property? The answer is that it depends on your definition or description of the “ideal” tenant.
Your idea of who the ideal tenant is versus who property management companies see as ideal are probably very different. So the first step is to know what characterizes the perfect tenant. For example, if you feel that the best tenants for your rental properties are working men, women, and couples ages 25 to 49, then you will need to develop a marketing strategy that targets that specific demographic. Ultimately, that marketing strategy could be the difference between renting to a good or bad tenant.
Sharpen Your Targeting Focus
Whether you tackle this by yourself or hire a property management company to do it for you, the key is to focus on digitally marketing your property. In other words, advertise your property by utilizing a broad range of online marketing platforms. So if you decide that “baby boomers” make the best tenants for the properties you are offering, then you will need to employ a mix of online and traditional types of advertising. While newer media is a good option, there are still those who prefer the more traditional ones.
No matter what marketing channels you or your property management team chooses, you can’t alter the deals or offers because the information provided will always be the same. After all, the property, its physical location, and monthly rent are going to be the same in every advertisement you run. As a result, property management companies get more creative and include information that will attract a targeted group of potential tenants. Unfortunately, most owners/investors lack that experience and expertise and that is why they need assistance from professionals.
Keep in mind that your goals with your investment property are similar to those of all property management companies – find the ideal tenants, retain the ideal tenants, and increase the value of the property while protecting the investment. And that is why you invested in real estate.