Imagine this: You have saved all your hard-earned cash and have been wanting to invest it for some time. But what should I invest it in? After much deliberation and research, you have decided that investing in property is your best option. You start looking for the perfect place. Eventually you find it and sign the papers. Now what?
After completing a few minor renovations you are now ready to rent it out. But to who? As a new landlord, and even if you have been in the game a while, you have the right to be picky. But what is the difference between being selective and down right discrimination?
Well, discrimination against bad tenants is just good business. You’re not discriminating on things such as race, colour, sex or religion. However, you do want to consider the following things:
1. Do they pay on time?
When tenants don’t pay rent on time or at all, it leaves landlords in a tough situation. You have every right to discriminate against tenants who are known to not pay their rent. Or those who don’t make paying rent the first priority instead buying expensive dinners and luxury holidays. Good tenants are those who know that paying rent is their first responsibility, bad tenants are those that don’t.
2. Can they even afford it?
It is vital during the application process to determine if the tenant has a stable job and can afford the rent as well as all their other expenses, especially pay attention to credit card debt and high car repayments. Always remember that what may be stable now, may not be in the future. People can lose their jobs, so it is up to the tenant to prove their income is reliable.
Good and bad tenants come in all shapes and sizes, so while it is important to discriminate on important matter such as their ability or willingness to pay, we should never discriminate based on religion, race or colour.
Have you ever had issues with bad tenants? What did you do about it? Did you know there is a website called Tenancy Bureau, where you can check up on tenants before you sign with them and also report bad tenants you have had. On the flip side, you can also report good tenants which help both them and their future landlords.