Effective Tenant Evaluation Strategies

Matching tenants with rental property involves a thorough process of understanding the applicant’s history. Much of this revolves around tenant screening practices, which include rental, criminal, employment, and financial background checks. These critical reviews, as well as your own assessments, are essential parts of tenant evaluation.

What is tenant evaluation? It’s both third-party screening and your own questions and interpretation of responses. In your approach, you must also keep in mind any laws about generating profiles and what’s appropriate to ask.

In this article, you’ll find effective tenant evaluation strategies that benefit you and prospective renters.

Decide who your perfect tenant is

Before you begin evaluating tenants, you can develop a checklist of expectations. This will help you determine what a tenant evaluation should look for once the property is on the market. 

Please note that your requirements cannot exclude or discriminate against someone due to any protected class (e.g., race, religion, age, gender, etc.)

A renter will likely need to meet these requirements:

• Be financially stable: One way to gauge this is the rent-to-income ratio. Screening services, including credit reports, also form this picture. Verifying employment can as well. You could set thresholds on the rent-to-income ratio and credit score.
• Have a clean rental history: You can check for any evictions and contact former landlords.
• Be free of certain criminal records: You cannot disqualify someone simply because they have arrests or convictions. However, some serious crimes would be red flags if there are concerns about safety, financial crimes, or previous property damage.
• Able to fulfill lease terms related to maintenance: Keeping the rental property in good shape requires a renter to be responsible for taking care of general areas of the house and ensuring it stays clean and well-maintained.
• Must have references: Getting a clear picture of who someone is involves hearing from others. You can require a potential tenant to provide references.
• Has the ability to understand the lease and its terms: The rental contract is a critical document, setting out owner and renter responsibilities and duties. To assess if someone does, go over some of the language to gauge their comprehension.

The psychology of tenant evaluation

When you meet with a potential tenant in person, you probably think of it as an opportunity for them to evaluate you and the property. In reality, you also have the chance to assess them and their fitness as a renter.

Remember, there are no hard and fast rules, and different people respond in various ways. The following tenant evaluation strategies offer guidance on what to take note of when getting to know a potential renter. This context will also help you evaluate their rental application more carefully.

Tenant evaluation strategies

Once you determine your tenant evaluation criteria, you can begin to consider applicants. These tips can support your efforts to place the right person in the property. It starts with your first meeting showing the property.

Rental property showings help you market the property to a potential renter. It’s also a great opportunity to evaluate tenants. After all, they must, in some sense, sell themselves to you as reliable and responsible renters. Find out how to use your next rental property showing to learn more about your applicants before they sign on the dotted line.

1. Watch for extreme responses

When you feel good about the home you’re showing, you hope that potential renters will like it, too. However, unusual reactions, whether overly enthusiastic or overly negative, could be a concern. They may be trying to butter you up or preparing to lowball you on price. These types of comments are especially suspicious if they don’t align with previous assessments of renters or your knowledge of the local market.

Most people you meet will be happy to see the property and interested in its features, the neighborhood, and local amenities. Beyond that, most of their attention will be on the logistics of the application process, if they’re interested, or they will politely decline to apply. Overly dramatic responses about the property could mean the applicant is trying to distract you from something that could appear in tenant screening.

2. Watch for excessive storytelling

You’ll be trying to get to know the applicant and will no doubt make small talk alongside your screening questions. If the person you’re talking to begins to tell long, detailed stories, they may be setting you up. Watch out for tales that cast them in the role of victim, especially in regard to a previous landlord. They may be laying the groundwork to excuse away a bad reference or a troubling detail in their background screening.

3. Watch for someone seeking exceptions

• “I don’t have quite enough to cover the deposit. Could I add some to the second month’s rent?”
• “My roommate works long hours. I know you’d like to meet him in person, but is it okay if you don’t?”
• “I know you have a no-pets policy, but my cat is very quiet and well-behaved.”

We’ve heard the saying, “Give an inch, and they’ll take a mile.” Tenants who start out asking for exceptions may be the same ones asking you to take the rent “a little late” each month or offering excuses for not mowing the lawn on time. Set your criteria and ensure your tenants adhere to them to save yourself headaches down the road.

4. Watch for excessive complaints

Many unreliable and unscrupulous people struggle to take responsibility for their own actions. They project their frustrations and dissatisfaction onto other people, including bosses, landlords, neighbors, and even friends and family members. Watch out for someone who explains everything in terms of fault-finding and complains about others.

In addition, some people have a negative view of the world that can extend to you and the property. If someone nitpicks every detail of the home, the yard, the process, the timeline, and the rent amount, consider whether they are a suitable candidate for your rental. The odds are that they will be even less happy once they move in, and you’ll have to hear their complaints day after day, month after month.

5. Watch for the condition of clothing, cars, and other indicators

There is no shame in driving an older car, wearing clothes that are out of fashion, or otherwise living frugally. However, a filthy, poorly maintained car, dirty clothing, and unkempt personal appearance may indicate a lack of regard for cleanliness, hygiene, and orderly living. After all, if someone treats their own clothing and car poorly, how will they treat a property they don’t own and for which they feel no responsibility?

What else should tenant evaluation look for?

Tenant screening as an evaluator

After the showing, if the person has an interest and you feel comfortable, it’s time to start the application process and tenant screening.

An online application, like the process provided by RentSpree, can help you streamline your tenant screening process. Here’s how:

• An online rental application is generally faster to complete and receive than paper ones, providing additional convenience for you and your potential tenant.
• Online applications give prospective renters the ability to pay for their screening, upload supporting documentation, and add information for multiple tenants. That simplifies the entire process for you and saves you time and frustration. For them, it keeps their personal information more secure and offers added convenience.
• Online applications with comprehensive reporting provide peace of mind for your clients. Whether you are areal estate agent specializing in rentals or a property manager, your property owners will appreciate the detailed information they find in a well-designed application and reporting process.

Remember, even if you find someone you really click with and want to rent to, you must use the same screening process for all applicants. This keeps you in compliance with fair housing regulations. It also protects you and the property owner from making a mistake and renting to an unqualified tenant.

Now that you know what a tenant evaluation is, it’s time to look at how to run a rental background check.

Continue to Chapter 8: What is a rental background check? or jump to a different article.

1. Tenant Screening 101
2. Creating your tenant screening checklist
3. Tenant Screening Laws
4. Determining Tenant Screening Criteria
5. Rental Property Marketing
6. Questions To Ask Rental Applicants
7. Showing the Rental Property to Prospective Tenants
8. What is a rental background check?
9. Top 5 Problems With Tenant Screening Services
10. Onboarding A New Tenant

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