How To, And How Not To, Rent An Apartment From Me

Today I’m going to give you a glimpse into our experience so far renting out our investment property.

After finally listing our two apartment units online in early September, we have had a grand total of four people come by to see the apartments in person. Why so few? Probably because the prices, $1,100 and $950 a month, are among the highest in the neighborhood. Four looky-loos isn’t a great total after having the apartments listed for a month and a half (although, to be fair, we were gone for two weeks in Japan) But do you know what average is good?

Every person who has come to see either of the apartments has applied to rent them.

I’ve found that you can write the greatest online ad take the most perfectly lit photos. It doesn’t matter so long as your rental is the most expensive in the neighborhood. But as long as it’s worth the rental price and even exceeds people’s expectations, it’s just a matter of getting people to show up and see the place in person, and you will have renters.

So far, we have had three people apply, only one of those we actually approved. [Yes, I said all four visitors applied. Technically, one was going to apply but was just beaten out by Case Study 3 (below) who visited on the same day, applied immediately and were accepted] So what lessons can you learn from these case studies when renting from me, your prospective landlord?

Case Study 1

This was a couple moving from out-of-state. The husband had a new job in the area.  He was scouting apartments in the area just a few weeks before the big move and starting the new job.

We have some rules for our apartment. No pets like dogs or cats. No smoking. The ordinary stuff. This couple had a support animal, which we would have to accept. I’ve no problem with a support animal since they are probably very well trained. But they also had a cat. Since they were moving from out of the area and needed somewhere to stay soon, I told him I’d bend the rules a bit since they were in a squeeze.

The problem came when they actually applied. It turned out that he smoked a pack a day. “Only outdoors, though.” I don’t care. I’ve seen enough horrifying house fires start on porches in the area, I don’t care where you smoke. It’s not allowed, period. Especially if I’m already bending the rules for a cat, I’m definitely not allowing smoking.

Tip: If my ad says no smoking is allowed anywhere on the property, that means you can’t smoke a pack a day. Inevitably, that smoking will probably end up happening on the property.

Case Study 2

A woman came to check out the $1,100 apartment. It would be just for her, and for when her daughter visits on weekends. Sounds fine to me.

According to her emails, she had more than enough income to pay the rent. I wanted to do my due dilligence with income verifcation, but her application listed a co-worker, not a supervisor, so I asked her for copies of her most recent paystubs.

It took two days, but she did send two scans of paystubs… with the pay dates erased just enough to be illegible. Funny, you could read the rest of the pay stub fine! And yes, it was enough income to cover rent and her exceedingly large car loan (thanks, credit report), but who knew how old this salary information was?

So I asked when the paystubs were from. Supposedly the past four weeks. Well, when the two Year To Date totals jump from $15,000 on one to $70,000 on the second, it’s a pretty good guess that those are not consecutive paychecks.

So I was pretty sure someone was trying to take advantage of me. As if I don’t know how to read a pay stub. The gall! Marge continued to give this person the benefit of the doubt, while I had already made up my mind. So Marge called the person’s employer and they confirmed, “She no longer works here.”

Tip: Don’t falsify your pay stubs. If you absolutely must do it because you’re some kind of pathological liar, at least do a better job of it than this person did.

Case Study 3

Let’s end with a good example. I listed the $950 apartment on a Sunday afternoon and got several inquiries, most of which didn’t respond to my emails. (What is that?) One guy was very good about replying and was anxious to see the apartment in person. He kept remarking on how beautiful it was in the pictures.

The guy and his girlfriend visited the apartment the next night after going out for their anniversary dinner. They were pretty young so this would be their first apartment, and they were engaged to be married next year.

By the end of the visit, they were already planning how they would use each of the rooms. When I mentioned that there was no smoking on the property because of the threat of fires, the guy said he’s so careful he unplugs his XBox everyday because it gets hot.

These kids (And I can call them kids because I think they’re ten years younger than me) had short job histories, little, but good, credit history, and no rental history since they had been living with their parents. But I could tell they were being honest and seemed enthusiastic about moving into the apartment. That is the mark of a tenant who will take care of their surroundings. Oh, bright-eyed youth!

I was right. When I discovered just two days before they were scheduled to move in that their washer and dryer were going to be out of commission for an undetermined amount of time, they took it in stride. They have been super easy to work with as I’ve had contractors coming and going while I have also been over there every other day fixing little niggling problems myself. They’ve only been there two weeks, but I can tell they will be great tenants.

Tip: Show genuine interest in the property. When the landlord/manager/whatever asks for additional information or documents, provide them. Most of all, be honest. Treat the property and owner decently and you will get that treatment back.

Do you have any apartment tenants you love? Or applicants you wanted to scream and run away from?

 

15 Comments

  1. Our favorite renters have been the ones that reminded us of ourselves 10 or so years ago. Young, but well-groomed. Not partiers, hardworking, but also flexible when stuff breaks and it takes a day or two to get it resolved. We treat them like adults, they treat our place like a palace. (Seriously, you should see how well decorated one set of renters has their place right now – it’s gorgeous!) The duds were the ones we felt rushed into accepting and never really felt like we communicated on the same wavelength with. Hope to avoid those in the future. =/

    • Norm

      November 3, 2015 at 6:51 pm

      I agree. Our two tenants we like remind of ourselves 10 years ago. Early 20’s, looking forward to living out on our own. And similarly, I was getting pressured by the woman with the fake paystubs because she had to let her landlord know ASAP if she was moving out, and that he was sure to miss her because she’s such a great tenant.

  2. I don’t own a rental property but this is pretty interesting. I’m sure you’re glad you were extra careful in doing your due diligence. The lady with no job would have stopped paying after the first month and then refused to move out 🙂

  3. I was a landlord with a nice house but high room rates for the area. So it took a little longer to find renters. Still, the people I did get were pretty reliable.

    But when I was an apartment manager, I was renting lower-end places, but the rents were very reasonable. A lot of the people were immigrants with no credit history, so first, last and deposit were required. Still, they were pretty diligent.

    The next building I was in was mixed. The apartment prices kept going up, but there weren’t enough renovations to make it quite worth the money. We got enough people looking, but only a small percentage would apply. It was frustrating and a little embarrassing to show people a mediocre place and quote a price that was on the high-end of the city’s mid-range apartments.

    • Norm

      November 5, 2015 at 6:07 pm

      I can understand how embarrassing that would be, especially when you have no control over the price. It’s encouraging that everyone who visits our place picks it over every other place they’ve seen, but frustrating to get people to show up in the first place. Feels like I have to lower the price just to get people’s attention, but if people will pay the higher price, I shouldn’t have to do that.

  4. These are some great case studies….. definitely more will come! 🙂

    I have had rentals for over 30 years. Here a two quick hacks:

    Hack #1: In a slow rental market, schedule multiple groups to see your place around the same time. I have found it weeds the Lookie Lou’s out and creates a competitive environment. You are likely to have someone give you a deposit check to hold the place and be first in line for consideration.

    Hack #2: If you want to see how somebody really lives, visit them where they live now. Invent a reason why you need to go to their house to talk with them or complete something they are missing on their application. What you see as far as neatness, maintenance, etc. is what you will get at your place.

    • Norm

      November 9, 2015 at 11:09 pm

      Ha! Hack #2 is brilliant. I use the trick of looking into someone’s car to see how neat they are. Hack #1 would work only if I could get people to show up in the first place!

  5. OMG….I swear Norm I have been a landlord for over 37 years and your comments are a hoot…and so very true. The money is in the book!…Lately the “pool” of tenant applicants has been “very shallow”. I charge an application fee for my applicants to keep from wasting my time….I was just telling DW the other day after returning from working on a rental that we need a movie theatre in that area. It seems when I’m there folks see the sign and my truck they just stop and bang on the door. And often become beligerant when I tell them to call the number and make an appointment to view the property. Many times it seems they just have time on their hands and don’t really have a need, but rather are looking for a “hobby”….

    • Norm

      November 10, 2015 at 7:27 pm

      Boy I would be happy to get some looky loos at this point! I’m thinking of either lowering the rent another $50, or dropping the “no pets” rule since there has been such a lack of interest lately. Any advice??

      I charge an application fee too for the required credit and background check, which I refund if I accept them.

      • Hmmm….not a fan of the “pets are OK as a fall-back”…Have had some serious damage from pets…it seems they don’t like to pee outside…the pets that is….I have had some luck offering a “bounty” to my “good tenants” in one of my duplexes. That is offer to credit their rent once for $50 for an applicant they have referred that is accepted. Gives them an opportunity to …”pick their neighbors”. Coming up on the toughest rental season…Halloween …Thanksgiving ….Xmas…and New Years…. occupy a lot of time. Hang in there….success in the rental biz seems to come when you least expect it…

      • As someone who rents and has a very-well behaved cat, the no pets rule can be a bummer. I prefer a pet deposit if a landlord is worried about pet damage. My cat has only ever scratched my furniture (and even that is minimal).

        I will say that cats are easier in an apartment with no carpeting.

        I also think being more specific is helpful — I have had such funny comments when I owned a snake and inquired about the “no pets” thing. If you mean “no dogs, ” then state that part up front. That might help you out a bit in getting the tenants with small, well-behaved pets who would be willing to pay more to keep their pets with them.

        • Norm

          November 14, 2015 at 4:58 pm

          True. I’ll add that. Right now the ad says “no pets,” but my existing tenants have a pair of sugar gliders!

          • I agree with Leah. As a pet lover it was disheartening to see Landlords charge something outrageous for my 75 lb dog. She was a big ol’ lovable mutt, no dangerous breeds in her at all. Mostly Rhodesian Ridgeback, and I think some Lab.

            One guy wanted $1,000 deposit, and his place was awful. I was however, able to get a letter from my current apartment complex Manager saying I paid my rent on time, or even early, for the 9 years I had lived there. And that my dog had caused zero damage. (She checked out my apartment, went room through room)

            Now I have cats. I can completely understand people with carpet not renting to cat owners. If a cat pees on carpet it’s not ever coming out (although my current Landlady says different, she mixes a few things together and says it works). My cats are very well behaved and use the litter box properly, and the only thing they scratch on is their own scratching posts. Which I provide and change regularly.

            You can also think about charging pet rent if you agree to the animal. An extra $10 or $15 per month.

            I am lucky as my current landlady that I rent my Condo from is a HUGE pet lover, and has Chows. So she’s been turned down by different places and understands how frustrating it is for someone to reject your animals. At one point I had 5 cats (rescues, I’m not over breeding over here or anything) and she tried to get me to take in a stray! Who does that?!?! However she comes over every month to pick up the rent. Both her and her husband have complimented me on how clean I keep the place. Her husband asked me how my place smelled so good with 4 cats, when his sister has 1 and her place smelled ”cat’ish.” I refuse to let that happen. I groom my cats and have invested heavily in 2 Dysons lol.

            So yes! There are responsible tenants with animals who will treat your place like their own home. 🙂 Good luck to you, and I realize this is 2 years old, so you may never see it. lol

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