President and CEO of Renters Warehouse, Kevin Ortner first joined the company in 2009 as a franchisee for the Phoenix region. After the retirement of founder Brenton Hayden, Ortner went on to take the reins of the company, helped see it through monumental growth and helped double their total number of franchisees in the country since 2013. In 2015, Kevin was honored with both an American and International Stevie Business Award for his achievements as Executive of the Year. With Kevin at the helm, Renters Warehouse secured elite honor roll status on the prestigious Inc. 500|5000 list of fastest growing privately held companies in America for its sixth consecutive year.
How to Solve Dr. Phil Level Tenant Issues
When you signed up to be a landlord, chances are you didn’t know you’d be taking on the role of psychiatrist as well.
August 2, 2016
Managing rental properties can be an extremely complex endeavor. You’re managing both people and their homes, and you’ll be subjected to all of the complex, emotionally charged issues that can come along with that: domestic problems, mental health concerns, and more. Ask any landlord and they’ll tell you that they’ve had their fair share of incidents — and, if you’re a landlord, you know that it’s true.
The fact is though, as the popular self-help guru Dr. Phil says, “You generate the results in life that you think you deserve.” For weary landlords, this means it’s important to recognize when you deserve better — and take steps to up your game if necessary.
Whether you’re considering becoming a landlord or seeking advice on managing your rental, here’s a look at some issues that landlords often face and potential solutions.
As Dr. Phil would say, “Let’s do it!”
This is the bane of any landlord’s existence. You think you have a good tenant who’s going to pay the rent on time and then before you know it, they’re a month or more behind.
Late-paying tenants are a common issue. In most cases, it’s not that the renters don’t care — there are often other factors involved. But as Dr. Phil says, “Change cannot happen unless you’re ready for it.” For many tenants, late rent may be more a matter of habit rather than anything else. It’s a learned behavior and, often, it’s a habit that’s difficult to break.
While you can’t force a tenant to pay on time, you can create a system that will help them develop new, better habits. Charging a late fee is just one part of encouraging on-time rent payments. Other ideas include creating a text or email reminder that goes out just before the due date. You might also consider providing incentives for paying on time, such as a discount on rent or a gift card. Finally, make it easy on your tenants; allowing them to pay online is perhaps one of the best ways that you can do this. Companies like RentPayment allow tenants to set up automatic transfers or make one-time payments for rent, and there’s even an option to pay using a mobile app.
Noise is another common issue, especially in apartments or condos. Some residents listen to music or movies at high volume late at night, causing issues with their neighbors.
Why do they do this? Again, the issue of habit comes up. In many cases, they may not even realize that they’re disrupting others. You may try to apply a concept known in psychology as the theory of mind here. Individuals who have theory of mind are able to see things through another person’s perspective. While some people are just better at looking at things objectively than others, this trait often increases as people get older.
Some loud neighbors simply need to be asked to keep noise levels down after dark, or be advised to wear headphones when listening to loud music. Sometimes, a polite notice is enough to make this point clear, but this isn’t always the case. If excessive noise continues, the tenant should be notified that they’re in violation of the lease. If that doesn’t work, you might have to ask them to leave. After all, boisterous tenants who refuse to mend their ways will only continue to drive good renters away.
This is one of the most common and unfortunate issues with tenants, and is especially problematic when damage isn’t detected until after the renter moves out.
According to Bill Bump, a Renters Warehouse rent estate adviser for Minnesota, this is an especially serious issue. Bump had to deal with extreme property damage when tenants in one of the rentals he was managing thought it would be a good idea to let their children play indoors –with rollerblades. “They played roller hockey in the main floor of the home,” Bump says, “destroying both the hardwood floors and walls in the process.”
Instead of waiting for the situation to reach this point, it’s important to always be up front with your tenants, informing them that you expect them to abide by the terms of the lease and letting them know in clear language what constitutes a violation. Always make sure you collect a security deposit from every new tenant as well, to help offset potential damage when they leave. Finally, you can mitigate problems like this by screening out the bad apples. Always conduct your due diligence before a new renter moves in. Don’t just ask for references; call them. When you check with previous landlords, read between the lines. Ask if they would honestly rent to the tenant again.
If you have to evict a tenant, the unfortunate fact is that they might decide to get back at you by destroying your property. Although relatively uncommon, this type of behavior represents a serious disconnect between tenant’s expectations and reality.
Take, for example Brandon Turner, a property investor and vice president of communications at BiggerPockets. After a serious of incidents, he was left with no choice but to evict a problem tenant. But far from being the end of his problems, it was just the beginning. While away on business, Turner received a mysterious text, informing him that his house was on fire. “Apparently, a box was left on top of the stove … and the burner turned on,” Turner writes. “The fire destroyed the kitchen completely and the smoke caused damage throughout the remaining house. In total: $61,000 in damage.”
While you can’t always prevent this type of behavior, you can make sure that you’re protected for when it does by obtaining adequate insurance on the property.
Another way to help reduce the likelihood of disgruntled tenants is, once again, establishing clear expectations up front. “What upsets people the most is not what actually happens, but when their [expectations] are violated,” says Dr. Phil. As a landlord, communicating clearly with your tenants from the start that violations of the lease result in eviction will reduce the chance of them being shocked into a retaliatory response when they leave. Once again, you can’t always prevent this from happening, but you can take steps to help reduce the chance of it occurring — and protect yourself in case it does.
Treating the landlord or other tenants poorly is a hallmark of a problem renter. “You either teach people to treat you with dignity and respect, or you don’t,” says Dr. Phil. “This means you are partly responsible for the mistreatment that you get at the hands of someone else. You shape others’ behavior when you teach them what they can get away with and what they cannot.”
If your tenants are treating you badly, you’ll want to consider what you can do to reinforce or allow that sort of treatment. Identify times where tenants may be rude, aggressive, or pushy, and make sure you’re not giving into their demands and rewarding them for poor behavior.
Failure to Communicate
As Dr. Phil himself would note, communication is essential to a successful partnership. When it comes to the landlord-tenant relationship, this is certainly the case. As a landlord, you’ll need to make yourself an expert in interpersonal communications.
Perfectly illustrating the need for clear expression, Bump recalls one instance when a property owner was chased off of his own land by a disgruntled tenant. “The owner showed up for a property inspection,” Bump says, “only to be greeted by the tenant — with a weapon. Apparently the tenant hadn’t read the email notifying them that an inspection was going to take place. Needless to say the owner left immediately and there continued to be conflict between them for the length of the term.”
Always ensure that there are open lines of communication between yourself and your tenant. You should provide renters with adequate notice before entering the property, and renters should inform you about problems that arise at the rental. You should also be very specific about outcomes that you expect. For example, don’t tell a troublesome tenant that you expect them to “improve,” instead, set specific goals that they can work toward, such as reducing noise after 10 p.m. or taking the trash out every Tuesday.
Many landlords have property management down to an art and are able to run a tight ship — often thanks to their excellent emotional skills and knack for business. Treat your rentals like a company, protect yourself and tenants with an airtight lease, and ensure that renters have fully read and agree to the terms. Never rush to fill a vacancy and always check references — if a tenant caused issues with another landlord, chances are they’ll cause similar problems for you.
Finally, remember the Golden Rule applies in every situation that you’ll encounter with your tenants. Your tenants are your customers; treat them with respect and create a positive experience by communicating clearly and often. After all, without them you wouldn’t be in business.