How to find quality tenants

Finding quality tenants can be tough. It’s been the biggest challenge reported by agents in our annual State of the Rental Industry survey in four out of the last five years.

At the same time, it’s also one of the most important parts of the rental agent’s job, because it makes everything else much easier. A quality tenant treats the property like a home. They report maintenance issues timeously to ensure the property doesn’t deteriorate, obey body corporate rules, and preserve the peace with good neighbourly behaviour.  

When the property is left in the same state it was received in at the end of the lease, and rent has been paid on time throughout the tenancy, your landlord will repay your diligence in looking out for their best interests – which starts with knowing just who to recommend placing.

What does a quality tenant want?  

To know how to FIND quality tenants, it’s also important to appreciate what a quality tenant is looking for. Just as agents have to sift through a pile of applications to find the perfect tenant, applicants are swiping through potentially hundreds of online ads.

Ultimately, they want a safe, secure, well-maintained property. On average, 30% of a tenant’s salary is allocated to rent, so it also needs to be both well-priced and affordable.

Price and affordability are two different key metrics. A property that is priced accurately for its location, condition and size will attract quality tenants; the good news is that there are quality tenants at every price point. On the other hand, properties that are overpriced will sit on the market for longer and potentially be overlooked by quality tenants., That leaves desperate tenants (who may have already been rejected from a string of better-priced properties) or worse, no tenants at all to select from.

Affordability is the the tenant’s ability to pay the monthly rent based on their salary earnings, other credit and expense commitments, and disposable income.

How to attract a quality tenant

Quality properties attract quality tenants, and so do quality advertisements. Your ad must stand out and accurately reflect the condition of the property. Misadvertised properties will only lead to wasted viewings and disappointed tenant applicants. And poorly advertised properties with poor quality photos will only lead to tenants swiping left for better quality properties.

Location has an impact on price, but once the price is right, some tenants will forgo location for more affordable pricing. However, safety, security and good maintenance is always important, no matter where the property is located.  

Estate agents take centre stage in finding and placing quality tenants. This is their time to showcase their expertise and their access to a pool of quality applicants.

Final steps to securing a quality tenant

PayProp’s Tenant Assessment Report ensures every applicant is assessed fairly and equally.

The PayProp Tenant Assessment Report scores each applicant on their:

• likelihood of paying the monthly rent based on their history of paying their debts and rent on time
• ability to pay the monthly rent based on their salary and existing credit commitments

Overextending a tenant on price will increase the risk of non-payment, while poorly vetted tenants just don’t pay rent, even when they have the money to do so.  

Lastly, just because a tenant is not accepted for one property doesn't mean they won’t be a quality tenant for a different property – whether it’s more affordable or can be leased with co-tenants, liable jointly and severally for payment. Try holding onto quality applicants by helping them to find properties priced within their affordability range or basing the application and lease process on joint applications.