How to retain a good tenant in a tough market

It is now widely publicised that the rental market in many areas is coming under pressure as a result of the Covid-19 Lockdown and a variety of factors affected by it.

One factor is an inevitable rise in financial distress among tenants. Another is that rental rates are coming under pressure as a result of higher stock levels.

Landlords who have been in the fortunate position to have good tenants who have maintained their payments should therefore consider taking steps to retain these tenants as far as possible according to the Seeff Property Group.

Good tenants do not just pay on time, but also take good care of your property. They keep good relations with neighbours and their landlord and raise any serious issue timeously to ensure that it is taken care of and that no damage to the property results.

Replacing tenants come at a cost, says Seeff. Aside from the cost of sourcing and securing a new tenant, you will need to clean the property and undertake maintenance to ensure it is in a good condition for the new tenant.

The first prize for any landlord should therefore always be to retain good tenants. Seeff gives five points to guide landlords:

Point 1 - Address maintenance quickly. Unaddressed maintenance issues can result in increasing frustration for tenants as they would view the landlord as uncaring about their living conditions. By being proactive with maintenance and ensuring that the property is in a good condition, the tenant will be just too delighted to pay their rent on time!

Point 2 - Provide good amenities. Internet has become a basic necessity, so ensure the property is internet and fibre ready where possible. Also ensure it is ready for satellite television. Other amenities valued by tenants include adequate cupboard space, parking and good security. Younger tenants tend to look for properties in mixed-use and vibrant neighbourhoods with restaurants and nightclubs with easy access to gyms and laundry facilities. Family tenants tend to look for quiet areas close to good schools, shops and medical facilities and with family-friendly areas such as parks or beaches.

Point 3 - Be realistic with the monthly rental. Setting the rental escalation too high will alienate good tenants and do not use a rental renewal as an opportunity to increase your rental yield, especially in a tough market. Ensure you reach out to tenants well ahead of the expiry of the lease to negotiate the renewal and consider offering a low increase in return for the security of retaining a good tenant.

Point 4 - Be a good landlord. Good relationships between a landlord and tenant is vital. Focus on being responsive to the tenant’s needs and always respond with a friendly and cooperative demeanour. A good relationship makes it much easier to retain a tenant and will encourage the tenants to pay on time every month.

Point 5 - Use a good rental agent. It is always advisable to make use of a credible local operator who can provide the right guidance on rental rates and assist with sourcing a tenant and managing your property if needed. Seeff is for example fully equipped to assist landlords, whether they have one or multiple properties with integrated software to ensure timeous rent collections, reconciliations, maintenance and incoming and outgoing inspections and much more.