How to Avoid a Broken Lease – A Landlords Guide to Success!
As everyone knows there are many responsibilities and costs that go hand in hand with being a landlord. Insurance, mortgage, holding costs, maintenance & repairs, the list goes on and on… But what is the most Expensive part about being a Landlord? —–> When your property Sits on the Market!
As many Landlords have experienced, having an Empty Rental is a definite problem, and can be reoccurring for some. We’re going to help you ensure that this issue Doesn’t Happen Again, and if it does, how to protect yourself from the repercussions. Typically, you can get stuck with any Empty Rental one of 3 ways…
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- The Tenants lease expires, and you have yet to find a replacement when they move out,
- The tenant Breaks the Lease due to some sort of unhappiness with their living situation, or
- The tenant simply cannot keep up with the agreements or payments of the Lease.
Of course, even the best of landlords are not capable of controlling the happiness of another human being, or able to control what goes on in their tenant’s personal lives… But what can you do to Prevent “An Empty Nest”?
Think about when you go out to a restaurant – Outstanding customer service is always expected, and is always very much appreciated. If you asked your server for a glass of water, or a nice bottle of wine, and they never delivered, chances are you would be pretty upset. The exact same service goes with owning a rental property. Great Management and Fantastic Customer Service are necessities for keeping your tenants happy. If there is an issue with the plumbing, or the laundry machine has failed, fix it right away! In addition to fixing it as soon as you can, be sure to communicate to your tenants that it is your top priority to get that repaired for them, and that you will have someone over to take care of it as soon as humanly possible. Always do your best to make your tenants feel cared about and important, just as you would like to feel when you’re out spending your cash on that nice dinner, at that restaurant.
Don’t be afraid to go above & beyond for your tenants! Just because you want them to respect you, and ensure they know that you don’t let late payments or minor damages slide, doesn’t mean you can’t do things for them to show how much you appreciate their business, because after all, it IS a business. For example, once a year give your worthy tenants a complimentary Carpet Cleaning Service. Not only will they appreciate it, and think it’s a total act of kindness (which on some level it is), but remember – that’s Your property! Getting the carpets cleaned annually helps with the upkeep of your investment. So the tenants are happy and more motivated to stay, and you’re investment stays spick and span! In reality, It’s a “Win Win” for you.
Thinking back to that restaurant, if you’re consistently receiving that top notch customer service, and every time you dine there you feel respected, appreciated, heard and valued, the chances are you will always come back, and you will always tell your friends and family nothing but good things about that specific restaurant. Implementing the same customer service system within your rental property business provokes happy tenants that stay for longer periods of time, and word of mouth referrals that most definitely help in the future, or for other rental properties you may be looking to fill.
Implementing Proprieties in the Event of a Broken Lease
Even while carrying out all of the customer service and management skills we just talked about, there is still always that chance a tenant feels they need to leave. Remember, Life happens – whether it’s an abrupt job relocation, or a family illness, sometimes people absolutely have to quickly vacate their place of residence. Although there is no way of preventing these occurrences, there are certainly ways to protect yourselves from the repercussions.
Always be sure to clearly review the Lease with your Tenant. Identify all of the terms that have been laid out in the agreement. Point out the “Cost of Terminating the Contract” section in particular. Inform them in a tender way that if circumstances occur and they have to vacate prior to the end of the lease, it is alright, and you do understand, however ensure they know that consequently, there will be a cost.
Throughout the lease, if it comes up in relevant conversation, (say they mention to you they were thinking of moving to Paris for a year, or they let it slip out that there is talk of a job relocation), don’t be apprehensive to gently remind your tenants of the fact that they are financially responsible for your property until you find a replacement to take over the vacancy. After outlining it clearly for them in the lease, as well as casually reminding them verbally throughout the lease, your tenants will surely be more understanding, and more willing to cooperate, hassle free.
So although as we all know Life is unpredictable, and things don’t always go how we expect they should in the world of rental properties, a few simple steps can save you from a lot of disturbance. Treating your tenants as if they are pristine guests at a restaurant or resort, combined with the explanation and gentle reminders of the necessary termination costs, you should find that your “Rental Nest”, should never again be Empty.
I Hope this Basic Guide was Helpful to All of you Land Lord’s Out there, & Remember; Often Times it is the Little Things that Go a Long Way. Thank You for Reading. -Mr.Action