7 Ways to Improve Your Landlord-Tenant Relationships for Better ROI
Titans, stripes and polkadots, landlords and tenants… some things just seem destined to clash.
After all, landlords and tenants have plenty of competing interests. Landlords want to charge the maximum rent that the market will bear, tenants want to pay as little as possible. Landlords want to spend the minimum amount of money necessary to keep tenants from leaving, and tenants want the most (and best) property updates they can wring out of the landlord. Landlords want the rent early, tenants would just as soon keep their money in their pocket. And so on.
But pause for a moment to consider how much easier your life would be as a landlord if you could slide the scale to make the relationship more symbiotic, less antagonistic. If your tenants knew you generally cared about them, might they make more of an effort to get you the rent by the first every month? They might grab the caulk gun themselves to fix a bathtub leak, rather than forcing you to spend hundreds of dollars to send a plumber out to the property. They might give you three months’ notice that they have to leave for a new job in another city, rather than wait until the last possible moment to tell you.
Here are seven ways to improve your relationships with your renters, which are all designed to cost little while paying big dividends in cooperative tenants.
1. Proactively Call the Renter and Ask about Their Improvement Wish List
Once each year, call the renter and ask about their property update wish list. Explain that you can’t afford to make the improvements right now, but if they pay their rent early for six/nine/twelve months in a row, you will agree to put aside the necessary money and make one of these updates. Choose the upgrade that will offer the best long-term return: what will make the property more valuable, and boost its market rent for years to come? One important caveat though: don’t raise the rent immediately after making a property upgrade. The renter will feel betrayed, perhaps rightfully so. If you do want to raise the rent at some point, wait at least six months after making your upgrade.
2. Know Your Tenants’ Basic Personal Details
What are their children’s names? What do they do for a living? What are their main interests and hobbies? When calling your residents, open by asking about how their children are doing, or whether they won that bowling competition they were entering the last time you talked. Just spending ninety seconds on social niceties shifts the framework from “All this person wants from me is money” to “This person knows me, and people who know me are less likely to screw me over.” If you can’t remember these things, that’s fine, just keep basic notes in your tenant's file on their relevant personal details.
3. Send Holiday Cards
Likewise, for $2.99/year, you can reinforce the message that you actually think of the renter as a person, not just someone to harangue when they’re late on the rent. Tailor the card for whatever holiday the tenant celebrates (since you know their personal details!), and keep it light and friendly. Write a line or two inside the card to make it personal, wish them a wonderful new year to come, and tell them how much you’ve enjoyed having them as tenant and your hopes that they will stay for years to come.
4. Offer an Annual Cash Incentive
Late fees make a great stick, but if you want to shape tenants’ behavior, offer a carrot alongside the stick. Try offering them a $400 Early Rent Reward each December, but only if they have made every single rent payment early, all year long. Tell them you will have their reward check to them by December 10, in time for them to use it on their holiday shopping. This is important though – don’t just offer to take it off their December rent, make sure they mail in their December rent (early), and then send them a payment as a separate reward that comes directly from you.
5. Send Flowers or Food When a Tragedy Happens
Did the renter lose a parent? Or worse, a spouse or sibling or child? Like you would for a friend, send them flowers or food. Do not send money, and do not take money off the rent. It should be a human gesture, a way to reach out and sympathize with their loss, not a pity gift.
6. Offer Your Contacts if They Lose Their Job
If your renter loses a job, it’s in everyone’s best interest that they find a new one. If you have any contacts in their industry, offer to put the resident in touch with them. Even if it doesn’t work out, your renter will be grateful that you did what you could. If it does work out, your contact gains a new employee, you gain a solvent tenant, and your renter will be extremely grateful.
7. Call When Sending Important Tenant Notices
Raising the rent? Sending a non-renewal notice? Preparing to serve an eviction notice and file in court? Yes, you still need to serve the tenant notice in writing for your paper trail and the landlord-tenant laws in your state, but give them the courtesy of a phone call when you send the notice. If raising the rent, you can explain it in terms they can empathize with (the mortgage payment going up, etc.). If serving them with an eviction notice for a lease violation, they may have additional information for you. Perhaps they’re late this month because they lost their job (in which case you can exercise #6 above, even though you will still need to start the eviction process). Or, perhaps they didn’t know that the lease agreement prohibited grilling on the wooden deck, and will be happy to move the grill to the lawn immediately because you called and asked nicely.
Remember how your mother told you always to be kind and friendly with people like the mailman, security guards, waiters and others that most people overlook? There’s a good reason to be kind to these people who play only minor roles in the greater drama of your life: at times, these seemingly minor actors will have the power to make your life better or worse. Landlord-tenant relationships are no different: if you put in just a little effort, go that extra yard to show that you see them as a person, you’ll be amazed how often others will go out of their way to make your life better too.