Who is your ideal tenant?

[Dustin Racine]

I know you need to perform your due diligence: conduct interviews, call past employers, check references, credit scores, etc. But some people are pretty crafty when it comes to covering the bases and people are not always as they appear. That being said, who have u had the most success with?
-professionals? bachelors/bachelorettes? couples? students? young families? Tradespeople? Seniors?

What are some red flags to look for in problem tenants? What too look for in promising tenants? Any advice would be appreciated.

Cheers!

 

[kfort]

I dont believe there is one type of ideal tenant. I believe there are ideal tenants based on the property & the property manager. Don't put an aspiring math PhD in a basement suite with 7 first year arts students above her who are living away from home for the first time.

It's the overall picture that you need to consider. Who is ideal for that specific property based off all factors. Not just who checks the boxes on a list.

For suited houses I look for younger/ early professionals or folks who are in their last year of schooling prior to beginning their career. If in school, I grab a co-sign. If they've got kids, I'm cautious due to noise transfer. For one place, I target dog owners as it is prime for a makeover soon (flooring and such is showing its age and I'm Maximizing income to bank it for a Reno).

For the apartment condo I've got, pretty much anyone. The building is quiet and the place is nice enough to cover a wide range. No pets, and our building is best suited for older children (or none).

For the non suited house I've got, professionals only. Family is fine there. But income is higher on the list as rent is $2200. Pets are fine, I target that actually and it has a massive yard so I target dog owners. No students here and no first timers. I've actually had some success marketing specifically to divorced / divorcing folks here. Great income, terrible credit, don't want a crappy apartment that stinks of college life and need a couple bedrooms for a kid on weekends or similar. I believe the "newly divorced" niche market is almost entirely unrecognized locally. Those folks are great generally. Only caution with this is the "newly separated and not sure what's going on yet" category... You'll often end up absorbing the ex and then they'll split again and then get back together etc etc or else you'll end up with a notice to vacate after month 3 of a 12 month lease.

 

[Matt Crowley]

Yes, I agree with Kristopher. My ideal tenant depends on the property and the right mix for the home. I don't really have much to add on that point.

I find that a lot of ideal tenant is discovered by price as well. A good tenant stays put for several years. So you want a pick a rent where you have a enough interest in the home that you can select someone who is really good and not so low that you get the bottom feeders who will move the minute they can save $20 / month. You need to find someone who really likes the house and is (ideally) already invested in the neighbourhood. The layout of the house and access to amenities will reveal much of who is your target audience.

The nature of basement suites is that you will have the most turnover. They are the entry level housing where most folks will want to move up to a walk up, apartment, or townhouse when they can afford the additional $100 - $200 / month. Affordability is not really a huge challenge so I put more weight on references - especially the employer. I don't own in locations where students request to rent from me so I haven't run into the cosigner problem.

References are very important but the credit report can still hold the trump card for me. I turned down an applicant last week with sterling references and exactly the sort of family I look for with my main floor suite / garage. He had $8500 in collections and didn't tell me why he doesn't pay his bills.

Great renters come from all walks of life. In my pre-screening questions I ask "Why do you want to live in Mill Woods?" I want renters who fit in with the house and enjoy their lives and the neighbourhood. I want them to be good neighbours to the other folks in the crescent and to have a vested interest in staying in the community.

 

[Cory Sperle]

The ones that stick around "rounder" tenants are the best in my experience. Male, single or divorced 40s or 50s, blue collar worker. Zero maintainance and always pays rent on time.

 

[kfort]

I think Matt's point about enjoying the neighbourhood etc is important. Even if you can get a lawyer to rent your basement suite, chances are they won't be happy there & that creates a pain in your rear. Match the tenant with the property. Always.

You're way better off having a tenant that is happy/ satisfied with the place than someone who is used to the ritz living in the imperial 400.

 

[RE123RE]

Hi,
A friend had success not accepting human beings with a new collection from the past 12 months. To implement this criteria you'd have to obtain your potential tenant's consumer report.
I've seen cases with ~ 500 credit score who became great tenants. It surprises me every time, and the guy above me - kfort, suggesting it is also a property tenants profile dependent, is correct.
Thanks

 

[SVS]

I would say definitely depends on your market and property finishes. Although I would agree Cory about the blue collar workers that are a little older. I have a tenant who has actually made improvements to my unit just to suit his own living style and keeps it really clean. Does the yard maintenance, Not to mention the rents always early. Pride of residence shows.

 

[kfort]

Listen for phrases like "I LOVE the _____ in your place" vs. "I really need just anyplace" etc.

Even straight out ask them what they like about it. If they say price then you know they aren't in love with it. If they list the dual sinks because their current unit has a tiny bathroom w zero space then you might have something. Let them ramble and show you what they actually noticed about it vs stuffing an application at them once you find out they make $75k/yr

 

[Matt Crowley]

I've seen cases with ~ 500 credit score who became great tenants. It surprises me every time...

Credit score is not a make it or break it for me. In my books, great tenants stay renters for long periods of time. I don't want a renter with a 720 credit score who is saving for a down payment. I want someone with a 580 with a dually truck and other toys they can't live without.

I've really been happy with https://www.tenantverification.com/ to run my credit checks. They show the beacon score but also any accounts that are in collections. I do not accept anyone with accounts in collections (unless they disclosed it and is due to an event totally out of their control). Writing is on the wall. I would rather have vacancy than that problem.

 

[Nick24]

I have to agree here tvs has been a great tool for us in part of placing tenants as well!

 

[Cory Sperle]

I think that many new Canadians who have a low credit score or none at all doesn't mean they won't pay, however accounts in collections surely does. It sucks greatly as a landlord when the tenant stops paying rent, as we have all had this happen at one point or another and I agree with Matt having a vacant unit is better than removing a non paying tenant. It's surprising how much pushback I have gotten from tenants about credit checks, saying they are 'illegal' 'invasive', 'not necessary' etc. when common sense suggests if one has a history of not paying their bills its likely they won't pay you either.

 

[RE123RE]

I don't want a renter with a 720 credit score who is saving for a down payment. I want someone with a 580 with a dually truck and other toys they can't live without.

Hi,
Good one. Very true.
Thanks

 

[Kjeck]

My ideal tenants one that is reliable . You have to make a picture of perfect renter for you. You can create a list of questions you would like to ask your prospective tenants before running credit and background checks on them. Here is the example of such questions https://rentberry.com/blog/potential-tenant-interview