Whether you’re new to the property game or you’re an experienced landlord, choosing the right tenants that’ll provide a smooth-sailing experience can seem impossible. Not only is the allure of a quick signing enough to make us forget everything we’re looking for, but even the most pleasant-seeming of tenants can pose issues down the line. Understanding the best types of tenants to consider and the issues that you might encounter can help to manage expectations and help you prepare for most eventualities.
The Common Tenant Types
The sheer number of types of tenants is vast, from single parents to newlyweds, through to students, elderly tenants and more. However, these can often be broken down into a few key tenant types according to employment status, age or financial situation. These are:
- Professionals – Professional tenants refer to anyone in full-time employment with a regular income. They are considered to be one of the lowest risk options for getting regular rent payments but may be likely to move soon in the future for work.
- Students – Students are any person in full or part-time education who may or may not be working a part-time job. Due to what is often a low or irregular income, they are considered a higher risk.
- Elderly – Elderly or retired tenants will differ greatly, with some holding a more substantial retirement fund than others, with some tenants still working even beyond retirement age. Statistically, they are more likely to want a longer-term rental agreement in order to settle down, without a high risk of moving.
- DSS – DSS tenants are any tenant who is receiving benefits in order to pay their rent. Some insurers consider housing benefit claimants a higher risk than working professionals, due to their financial vulnerability and dependence on government support.
- Lodgers – Lodgers in your property refer to any tenant in a property that you are still living in, who might be renting a room. In most cases, this won’t make you a landlord, but you may not be covered by a standard home insurance policy. Make sure to check this with your provider to be sure.
- Family – If you have family staying in a property you own, even under a rental agreement of sorts, this won’t always require a landlord insurance policy but again you might not be covered on standard home insurance. This should be checked with your insurance provider.
Other Things to Consider About Tenants
When it comes to renting a property, you’ll generally know which tenants you are likely to see the most of depending on the area the property is in, your price range and who you’re advertising to. However, when you do get applicants or you’re working out who you feel comfortable renting to, there are a few more things you’ll need to think about.
Character is as important as previous experience
Having a full ‘CV’ of previous tenancies is all well and good but, while it is important to consider, you also need to take the time to work out the applicant’s character. Respectful, down-to-earth tenants who can communicate well will make the relationship a lot smoother along the line regardless of which problems come up. Someone might have the perfect track record in the past but if they can’t communicate or expect too much from you, it could cause tension and clashes in the future.
Determining the loyalty from your tenants generally comes down to how long you expect them to stay at your property. Families, in most cases, are looking for long-term or permanent places to live and may not be able to afford a home of their own and so are likely to treat the place with more respect than a shorter-term renter might. They are also more likely to work with you rather than against you if any issues crop up that need to be resolved.
Couples give better security
If you’re looking to rent to professionals, couples can be a better choice than an individual tenant simply because they have better security overall. You’ll get a reference for each tenant, sometimes a guarantor for each tenant and in cases where one tenant may lose their job or fall short on income for a month or so, the other can often pick up the slack in the meantime. This isn’t foolproof, but for a more stress-free renting relationship, can be a good way to go for new landlords in particular.
Consider student letting, but get the right cover
Student letting is a whole other way to be a landlord. If you have a property with several bedrooms, you can usually let out the property on a by-room basis, meaning that groups of students can get together and rent out a property while only paying for their particular room and the communal areas. Students have gained a bad reputation over the years through parties or noise complaints, but in most cases, they are responsible tenants whose parents or family are often more than happy to be a guarantor. You may need to adjust the rent times to match with student loans, but this is also a way to ensure you do get the money asked for.
Tenants that ask questions are more attentive
If your potential tenants are doing as many checks into you as you are into them – within reason, of course – this could be a sign that they are serious about the decision and are in it for the long-haul. Serious tenants want to know what they’re getting into and want to know that it’s safe and for this reason, any tenant that asks questions or wants to know your own history as a landlord is likely just diligent and are likely willing to enter into a reliable tenancy agreement.
Look for someone you’ll get along with
Finally, you ideally want to rent your property to someone that you get along with. If you and your tenant don’t get along in general, it’s likely that you’ll run into problems down the line when you need to communicate. For this reason, try and set up a good relationship with them from the very start and it’ll make for an easier tenancy for the entire duration, and even encourage them to stay for longer.
For more information about landlord insurance and how to find cover for specific types of tenants, get in touch with a member of the team at Ashburnham Insurance, today.