Explaining the four jobs of a tenant
I’ve written to you many times about how we “hire” people to do the four jobs of a tenant. And I’ve said those fours jobs are the standard by which we choose our tenants and also how we decide to “fire” them when they’re not performing.
And just to remind you, the four jobs are: 1. Take care of the house. 2. Pay on time. 3. Be comfortable to work with by staying in good communication and being respectful. 4. Be a good neighbor.
These jobs are listed in a specific order based off of their importance. And I’d like to explain the reasoning behind that.
The first job is to take care of the house, and I’m always quick to point out that this job comes before paying on time. Let’s think about that for a minute. What would cost more: a well-maintained house with a tenant who missed a payment during COVID-19 shutdowns or a tenant who pays early each month but doesn’t let you know that the water heater has been leaking for months and rotting the floor? What if they also allow their kids to knock holes in the doors while the dog scratches through the carpet after it gets through using the bathroom on it?
Now, I made that one sided, but you should get the idea. Damage is the most expensive thing on a rental property, and it affects your bottom line more than having a late, or even nonpaying, tenant. As such, the No. 1 job is to protect your house from damage by taking good care of it.
Now, don’t get me wrong. We expect our tenants to pay on time. That’s why it is job No. 2. But some landlords care only about the monthly payment and turn a blind eye to the condition of the property. I think that’s an error that will cost more due to tenant turnover. You see, if a house is in disrepair and a tenant is willing to take the house in that condition, they won’t stay long. That means you’ll have a higher vacancy rate, lost rent and the probability of more damage as people move in and out regularly.
Making sure our houses are taken care of increases our profitability and is the most important job of all for a tenant.
I don’t think I need to spend a lot of time on why paying on time is important. But job No. 3 is built upon the first two jobs. I need the tenants to be comfortable to work with by always using good communication. And they need to do it in a respectful manner. We treat our tenants in a professional manner and expect the same out of them.
But you see, the tenants are our eyes and ears at our properties. They need to know that we not only encourage them to contact us when something like the water heater is leaking, but we expect them to do it quickly. That’s good communication in maintaining the property.
We also want them to contact us if they have something going on financially. For us, rent is due on the first and late on the second. Our office manager, Marybeth, has a great saying. “Rarely, if ever, does financial difficulty happen overnight.” With that idea in mind, if the tenants have something come up like a check that drops on the second this month, they need to let us know about that in advanced and not the day before rent is due. That is being comfortable to work with and staying in good communication about payment.
The last job is to be good neighbor. The reason this is on the list is because we typically have houses in nonrental neighborhoods. That means the people next to our rental houses own their homes and will typically outstay our tenants. As such, we need tenants to be good and respectful neighbors and to have a good relationship with the neighborhood.
This week, we had a neighbor call in on one of our tenants — and it was for a good reason. You see, this tenant lives next to an elderly couple, and our tenant has been going out of his way to check-in on them, especially after he learned the neighbor had cancer. The call was to let us know that our tenants were always good neighbors and to brag on the current tenant. It was good to hear that our tenant was not just being a good neighbor, but a great one.
Joe and Ashley English buy houses and mobile homes in Northwest Georgia. For more information or to ask a question, go to www.cashflowwithjoe.com or call Joe at 678-986-6813.