When it comes to finding good tenants, Singapore is a step up…from hell. If there was a training video for landlords, it would be the last 30 minutes of The Shining. And by the time you want Singaporean tenants to leave, you’ll be torn between calling pest control and an exorcist. So f you need to rent, follow our guide. We’ll help you find the best tenants, and maybe save on psychiatry fees:
Renting your place is supposed to make your finances easier, not spawn bleeding ulcers. But rent is a great way to do either: Get good tenants, and your rental yields will more than cover your loans. But get bad tenants, and they could end up bankrupting you. Stalled payments, sudden disappearances, and parties more damaging than Godzilla on meth are all typical hazards. To avoid them:
- Maintain your own standards
- Use conditional advertising
- Allow compromises
- Look beyond your rate
- Source for leads
- Build a relationship
1. Maintain your own standards
Singapore is one of the most pro-landlord countries in the world. Amazingly, this has a drawback.
Anyone with room to let, whether it’s a bachelor on hard times or a tycoon with a vacant house, can be a landlord. And thanks to this lack of regulation, we’ve forgotten that landlords need to maintain certain standards. Time and again, landlords post on forums and ask things like “Why can’t I get good, highly paid tenants who are lawyers, professors, rich expats, etc.”
Well, do you present yourself in a way that would attract those tenants?
Do you meet prospective tenants in decent attire, or a sweat stained singlet?
Do you have handouts, pictures, or a procedure for showing the room / house, or do you just wing it every time?
Landlords often forget that tenants are also evaluating them. If a tenant is going to fork out some $2000 a month, it’s not going to be to someone who looks like the triad member on last week’s Crimewatch. So dress right when meeting clients, and lay off the Hokkien vulgarities or non-PC jokes.
Above all, establish a procedure for showing off the property. Pre-plan and cover all the best features, and give a name card. Like attracts like; tenants who are professionals will zero in on these types of landlords.
2. Use Conditional Advertising
Advertising is the best way to filter out undesirable tenants.
Instead of just claiming “lowest rent in Jurong” or “best street view in Woodlands”, try to politely suggest your conditions. For example, you could say:
- Ideal for couples without children
- Quiet neighbourhood (dissuades party animals)
- Great for
(whatever profession you want) - Perfect for office workers near town (if you want corporate types)
Too many landlords worry about quantity of response, instead of quality of response. What’s the use of having 200 prospective tenants turn up, and then finding out all of them are terrible? Do you really want to waste your time talking to every one of them?
All you need are two or three good responses. You’ll spend less time showing off the room / house, and you’ll have fewer problems later.
3. Allow Compromises
Refusing to compromise can land you a bad tenant.
Sometimes you’ll find prospective tenants who have stable jobs, great reputations, and are willing to commit long term. The catch? They want to repaint the walls, or install a partition. Now if they’re willing to pay for it, why not consider compromising?
You’re not living there every day. And if their rent payments are regular, it’ll make up for restorations when they leave. Consider that a bad tenant will cause you more problems than repainted walls or a partition.
4. Look Beyond Your Rate
Some landlords pick tenants based on rental rate alone. The one who accepts the highest rental rates is the new tenant, period. The only thing simpler is the space between the landlord’s ears.
Beyond the client accepting your rate, be sure to check what they do. Freelancers, for example, tend to make money in starts and stops; I used to end up with $12,000 one month, and $500 the next. Whatever the rate they accepted, brace for months when they defer payment.
Likewise, you’ll get tenants with the hygiene standards of a sewer rat, or tenants whose idea of a party involves police nightsticks. These issues may end up costing you far more than you actually make.
5. Source for Leads
Responsible people tend to hang out with other responsible people.
So if your client seems the clean cut, reliable sort, then approach them for leads when their lease is ending. Offer discounts to their friends who might want to take over. If your tenant is a neatness nut who polishes the kitchen every 17 minutes and chews exactly 25 times on each side, then his friends are people who can stand him.
They’re other neatness freaks is what I’m saying.
Of course, you can’t do this when getting your first tenant ever. But it just goes to show, you should be extra careful when selecting the first one. And if you do make the right choice, you should make it a point to…
6. Build a Relationship
Never seem unapproachable or hostile to a tenant. It’s not just because they’ll go somewhere else; it’s to keep in touch.
If your tenant considers you a friend, they’re more likely to share certain kinds of information. For example, a fear that they’re being laid off soon, or that they’re not doing too well. But if they secretly wonder whether you’re the Antichrist, they’d never tell you that. You’ll find out in an e-mail titled “Leaving now, k thx bai”, which gives you one month to find a new tenant.
And when tenants trust their landlords, they’re inclined to be honest. They’ll tell you they accidentally broke the table, instead of buying a roll of duct tape and hoping you won’t notice. They’ll tell you a pipe is leaking, instead of keeping quiet so you don’t blame them.
These little things mean a lot of money in the end. So drop the lord and master act, and you’ll find being a landlord that much easier.
Image Credits:
Alex Barth
AntaresRoute66
mrflip
bailyraeweaver
puuikibeach
Highways Agency
docpi
beggs
Are you a landlord? Comment and tell us some of your experiences!
Get more Personal Finance tips and tricks on www.MoneySmart.sg
Click to Compare Singapore Home Loans, Car Insurance and Credit Cards on our other sites.
More From MoneySmart
