Every owner wants to maximize their rental property ROI. Property location, number of bedrooms and bathrooms, curb appeal, interior finishes, and school zonings all play key roles in ensuring an owner can maximum his/her monthly rent potential. However, we think maximizing ROI is also a long game that rests, in part, on selecting the right tenant. Why is this so important?
After acquiring a property in a high-demand location with desirable bed and bath configurations, and investing in interior and exterior renovations for the purposes of renting, an owner wants to keep that property in premium condition. One of the best ways to do this is by placing a tenant who is financially capable of paying the rent on time and who has a proven track record of previous responsible tenancy. At Wilson Management Group, we believe that selecting the right tenant via thorough applicant screening provides these five benefits that help maximize rental investment ROI:
1. Financial Stability: Employment/income verification confirms that an applicant is qualified financially to rent the property and positive rental history references show they have a proven record of paying rent on time.
2. Lease Compliance: Positive previous residency/rental history indicates an applicant that has proven their ability to abide by lease terms as those relate to paying rent, having pets, HOA compliance, etc.
3. Legal Protections: Criminal history background check and a public records search for evictions on applicants helps protect owners from becoming victims of fraud which is on the rise right now.
4. Property Protections: Positive previous residency/rental history references indicate applicants who are more likely to treat a property with care and report maintenance issues in a timely fashion.
5. Reduced Liability Risk: A well-qualified applicant is more likely to experience a stable tenancy and therefore offers less risk overall to the owner for rent defaults and abusive wear and tear on the property.
With fraudulent applications and documents on the rise, it is more important than ever to meticulously screen applicants against rigorous qualification criteria that are applied uniformly and consistently to all applicants in accordance with Fair Housing Standards. Thorough applicant screening is a crucial step in creating stability and more peace of mind as you look to maximize your residential property investment ROI.