Thinking of finding tenants for your property yourself? Here’s what you need to know
Tenancies usually go wrong when you have selected the wrong tenant. With the right tenant, even if tenancy issues arise, it can usually be resolved between the landlord and tenant themselves. With the wrong tenant, it will be a headache and usually ends up in the Tenancy Tribunal. 99% it is better to rent to a good tenant at a slightly lower rent than to go for a marginal candidate who may initially offer higher rent but then cause many problems later during the tenancy.
A landlord should always have all tenant applicants complete a tenancy agreement before entering into an agreement with the successful applicant.
The tenancy application gathers all the information about the applicant to allow the landlord (or property manager) to properly assess the suitability of the applicant.
Besides the contact details, taking a copy of ID, current address, the Key questions to ask in an application form
- How long have they lived at their current and/or previous addresses? An applicant who is always moving every few months is a red flag. Even if there is a plausible explanation, most landlords don’t want to make constant turnover because of the costs of finding a new tenant (marketing, and vacancy during the period between the last tenant leaves and the next tenant moving in), and because a lot of damage to the house (carpets, walls,etc) can occur during the moving in/out stage.
- Do they have pets? You have to decide whether or not you want a tenant that has pets. This really depends on you but there is always a risk that carpets and the housing interior can be ruined by pets.
- Age – This is particularly important because it is difficult to enforce a contract against a minor (person under 18).
- Has the applicant ever had a tenancy terminated before? If the applicant answered yes, the next question is to ask the applicant to provide details.
- Was money ever deducted from your bond? If yes, provide the details. This is important to assess whether damages or unpaid rent was ever deducted from the bond.
- Have you ever been taken to the Tenancy Tribunal? A person who has been taken to Tenancy Tribunal is a red flag.
- Why are you looking to move from your current address? Always a good question to assess whether the applicant is being forced out of their current house or whether they are moving to be closer to work.
- How many people will live at the house? Generally a 3 bedroom house is suitable to 4 people and 4 bedroom house is suitable to max 5 or 6 people. This is a valid question to prevent overcrowding in your house.
- Ask for referees (usually their previous landlords can provide insight into how the tenant was during the prior tenancies). Referees can provide corroborating evidence to support the information the applicant has provided. A follow up question to ask previous landlords, would include whether the tenant had rent arrears, whether the bond was deducted to cover damages, how long the tenant stayed.
The application form should clearly state that the applicant consents to you using the information and contacting the referees to obtain evidence to support the application.
A good example can be found at https://www.tpscreditcontrol.co.nz/tenancy-application.