We finally got a new tenant for our rental condo. This time it’s for real! The tenant has already moved in and the rent is in the bank. A few weeks ago, another potential tenant signed the lease and backed out at the last minute. I was very disappointed because she seemed like a great fit. After she backed out, I put our condo back on the market and got a lot of interest. I screened 20+ potential tenants in about a week and it was crazy. I imagine this is what online dating must be like.
Anyway, we had more interest because the weather was warming up and more people were looking to move. Winter is the worst time to have a vacancy. Spring and summer is much better for finding new tenants. Today, we’ll go over what I did to improve my listing and then share my notes on the potential tenants. You’ll see that being a landlord isn’t just about collecting the rent.
Improving the listing
Our rental condo had been vacant since November. Nobody wanted to move around the holidays so it was tough to find the right tenant. I had some interest, but most of them weren’t a good fit because they worked at home or irregular hours. There is a building under construction next door so many tenants were unsure of the construction noise. This isn’t a big problem if you work regular hours because they’re only supposed to work 7:30 am to 5 pm on the weekdays. I finally found a good prospect, but she backed out after signing the lease. It was mid-February by then so I wanted to get the unit filled ASAP and embarked on a plan to get more interest.
Split out parking
The first thing I did was to split out the parking spot. Previously, I listed the condo for $1,350. This included a parking spot in the basement garage. I changed the price of the condo to $1,190 and charged an extra $160 for the parking. There are many carless residents in our area. Splitting the parking out made the condo seem much cheaper on the apartment listing sites. Most apartments in downtown do this too. A newer 1 bedroom apartment typically lists for $1,400 without parking.
With the change, our condo became the cheapest listing in the whole neighborhood and it was flagged as the best deal on Apartments.com. Yes! More eyeballs. The listing sites don’t consider parking part as of the rent. Prospective tenants have to figure that out on their own.
Next, I uploaded better photos. Previously, I took the pictures myself. This time, I got better pictures from the pro. (The condo was listed for sale as well. I took it off the market once it was rented.) The professional images look much brighter than the photos I took. I think this helped a lot too, although, the glossy pictures probably set higher expectations than reality.
Listed in more places
Lastly, I listed the condo in more places. I put a listing on Craigslist, Zillow, Trulia, and Apartments.com. All these were good and brought in some leads. Craigslist was the most spammy and unreliable source. The leads from Apartments.com and Zillow were much better quality.
The lower price, better pictures, and nicer weather made a big difference and led to an overwhelming response. I got 20+ leads in about a week. I imagine this is what online dating is like. You put up a nice looking profile, go through listings, send out a bunch of inquiries, and screen through all the responses. However, I don’t know anything about online dating. We got married in 1999 before online dating was a thing. Or was it already a thing by 1999? Anyway, we’ve been together since 1994 and I know for sure that was before online dating.
Here are my screening criteria. There are many posts online about this. Here is a good one on tenant screening at Bigger Pockets. Check it out if you need help. You need to tell the tenant about your criteria so they know what to expect.
My basic screening criteria
- Income: Rent is under 35% of income.
- Credit score: 670+
- Background check: No felony (You can’t say no crime.)
- Rental history: No eviction. Pay rent on time.
- No pet and no smoking (HOA rule)
Now, I’m going to violate the landlord-potential tenant confidentiality agreement and share my notes with you. All names have been changed to protect the innocent except the first one. That guy is a scammer. The rest will be short blurbs. Hopefully, I don’t offend anyone with my inner opinions.
1. The Craigslist scammer. What do you know? The first response came from Craigslist. You have to read this if you’re a landlord or thinking about becoming one. Here is the email.
Good day, I am interested in your rental,I read through the details on Craigslist and i like it, the location works fine for me as well.My name is Sridhar Vignesh Pandey, I am 35 years old. I work with the UNDP (United Nation Development Program, Admin., Cardiff CF14 1AH, UK). I just got a transfer bringing me down to the States USA. I am married with a daughter but i will be arriving and staying alone. I don’t smoke and i do not keep pets so i am sure you would not have a problem with me.
I was in NYC at the Head Office 2 months ago for a seminar. I applied at the DHS, did the medical check-up which i cleared and my SSN is been processed. I arrive the States in 2 weeks. I would present to you all relevant documents (letter of employment and letter of transfer etc) with time, and show them to you on my arrival.
I will really appreciate it if you can take the ad off and hold the place for me till I get there. I would like to place a good faith deposit for this purpose.
Please let me know if this arrangement works out for you. I sincerely look forward to hearing from you and subsequently meeting you.
At first glance, this guy sounded okay. He worked for the UNDP and he might be a good tenant. However, something made me suspicious and I Googled “Sridhar Vignesh Pandey.” It turned out this is a variation of the old Nigerian Prince scam. The scammer would send a fake cashier check for 2x the deposit and rent, and then ask for the difference to be wired back to his account.
I ignored any further communication from this scammer. Finally, cyber stalking paid off. I always Google a potential tenant to find out as much as I can about them. Is that too creepy? It’s pretty amazing what you can find on social media.
2. Nate – a young student. He’s very detail oriented. He asked many questions and said he wanted the place. Being a student, he doesn’t have a job and his credit score probably isn’t great. He also asked for a 6 month lease. I suspected that he’s graduating soon and won’t be staying long.
3. Vajra – a young, attractive, high maintenance, female. I cyberstalked her and I think she worked at Intel. She called at 9 pm on a Tuesday and asked to see the place because she happened to be in the area. I had just put my kid to bed and was already in my PJs. I changed and rushed over to show her the condo. She seemed to like the place. She asked if she could park her expensive bike in the bike parking area. I told her it’s not a good idea because this is downtown and there are homeless people around. Besides, we recently had some issues with theft in the common area. She became concerned about security and said, “I’ll call you.” I know a brush off when I hear it.
4. Sam – this guy was a dreamboat tenant. He was handsome, married, made over $10,000 per month, had great credit, and planned to stay for about 2 years. Sam told me he had to run it by his wife and I never heard from him again. 🙁
5. Eric and Jen – new grad young couple. They were moving to Portland with no job and no income. Eric said he wanted to put in an application and just needed to go to the ATM to get $30. They left and never came back. I assume they found a cheaper place.
6. JJ – local architect with good income. I had a good initial conversation with him on the phone, but he was unresponsive to my text and email after that.
7. Chloe – made an appointment to come see the condo. She was a no show. I texted and she responded that her flight was delayed.
8. Leo – moving up from LA. He was serious about finding a place and we had several exchanges via email. He made an appointment to see the place when he came to town.
9. Brittany – wanted to know if it’s okay to bring her mom’s dog once in a while. I stated no pets in the listing.
10. Shang – a foreign student at PSU. He wanted me to hold the unit for him until June. Yeah…Four months out won’t work for me.
11. Couple with a dog. The listing clearly stated no pets so I don’t know why they contacted me. I may have to rethink the no pet policy. Many Portlanders are attached to their pets.
12. Erin – nice young lady with good credit and a job. She has a service dog. Landlords can’t turn down a tenant because of service animal so I showed her the unit. Service animals are not considered pets.
13. Steve – an exchange student with a wife and 4 year old twins. Those kids were very active. They were running around pulling on everything they could get their little hands on. The twins also left dirty footprints on the carpet. They just landed and were staying in a hotel. They wanted the unit and told me they’ll move in the next day. I informed them that it would take 4-5 days to screen and they said that will be too late. Thank goodness because I didn’t want these crazy kids in the unit. It is illegal for a landlord to refuse to rent to someone with children. Of course, he has no credit history and no job because he’s a foreign student.
14. Theo – sounded like a nice guy via email exchanges. He couldn’t make the showing due to a sick kid.
15. Seth & Maddie – nice young couple with good income, okay credit, but unstable jobs. They had 2 cars and needed 2 parking spots. They told me to send them an application. I did and never heard back from them. I assume they found a better fit further out. It’s much easier to find apartments with 2 parking spots outside of downtown.
16. Marcia – sounded like an older lady, probably retired. She made an appointment, but called to cancel once she arrived in the neighborhood. The view was very important to her and the new construction next door would block a lot of the view once it’s done.
17. Tami – a well-dressed, professional female. She liked the unit, but she was looking at more apartments. She told me she’d let me know in a week.
18. Fabia – wanted a friend to come check the place out because she was out of town. I canceled the showing after the lease was signed.
5 more online prospects that I turned down after the lease was signed.
Too many prospects
Whew! I was exhausted by the time we signed the lease. There were too many prospects over just a week. I’ve screened tenants before, but it was never this fast and furious. Luckily, I live in the next building so it was easy to drop by and meet the potential tenants.
I think the lower price and better pictures made a huge difference. The better weather probably helped as well. Oh, I rented the condo without parking. Our new tenant does not have a car. A few days ago, I found someone who needed a parking spot so it worked out very well. The going rate is about $180 for a spot in the building. I gave it to him for $175, what he’s paying now. He’s losing his spot because the parking spot owner is getting a new car.
Alright, I hope you enjoyed this update. If things go well, I won’t have to write another update for at least 12 months. Actually, I hope our new tenant stays for about 2 years. By then, the new building will be finished and it should be much easier to sell the condo. This might be the last time I have to screen tenants because I’m getting tired of being a landlord in Portland. There are more rules and regulations every year. Now a landlord has to provide relocation assistance to the tenants if you want or need them to leave (no cause eviction.) That fee is $3,300 for a one bed room unit.
Also, the Portland real estate market is getting overpriced and the property tax keeps increasing. At this point, I prefer to invest in heartland real estate through RealtyShares. It’s much more passive than being a hands-on landlord.
If you have a rental property, have you screened this many potential tenants in a week? Is this what online dating is like?
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For 2018, Joe plans to diversify his passive income by investing in US heartland real estate through RealtyShares. He has 3 rental units in Portland and he believes the local market is getting overpriced.
Joe highly recommends Personal Capital for DIY investors. He logs on to Personal Capital almost daily to check his cash flow and net worth. They have many useful tools that will help every investor analyze their portfolio and plan for retirement.