Landlords and Property managers have a difficult mandate: find people that are reliable and fit well into the community.
The traditional approach is to:
- Fill out application
- Meet applicant
- Check references (Maybe)
- Run Credit report (Maybe)
The problem with this approach is you are only getting reliable information right at the end of your process. There is very little pre-screening and in tight markets like Toronto, Vancouver and New York you could be wasting a great deal of time and opportunity cost on multiple applications. Here are some ways to pre-screen tenants before you pull the trigger on a credit report; saving you money and saving your potential resident’s credit score.
Not everyone has a social media presence, but chances are if your applicant uses the internet they are one of Facebook’s 1.5 Billion users. 79% of Internet users sign on to Facebook and there is valuable information that applicants make public.
Here is the demographic breakdown:
- 88% of 18–29 year olds use Facebook.
- 84% of 30–49 year olds use Facebook.
- 72% of 50–64 year olds use Facebook.
- 62% of 65+ year olds use Facebook.
Aside from an obvious red flag like “guy that takes pictures with automatic rifles wearing a Nazi hat”, with the right analysis tools utilizing artificial intelligence and machine learning, someone’s posts can give great insight into their behavior. Uncovering traits like willingness to pay and qualities like agreeableness and emotion range increase the probability of finding a great tenant.
Criminal and Court History
Knowing if a prospective tenant has a criminal history has obvious benefits to you; your staff and your other residents, but, in addition to a criminal check, looking into court history can uncover other red flags. Having a resident that is overly litigious can be an expensive misstep. If a residents gut reaction is to sue every time something doesn’t go their way your legal bills can add up fast.
Scanning local and national media sources for instances of your prospective tenant in the news can be invaluable. Negative events that never make it to court or result in criminal convictions will often be reported in the news, in local and national publications. Providers like Certn can quickly and easily scan thousands of sources, locally, nationally and internationally to make sure your potential resident isn’t hiding something from you.
Eviction records may well be the best indicator of a poor tenant. If they have done it before they have a high chance of reoffending. If your tenant shows up on one of these lists its best to just move onto the next applicant. Don’t forget there are a lot more evictions each year than you may think; in Ontario alone there were 60,144 evictions (4.6 % of renters). Most landlords do not report bad tenants or evictions to credit bureaus, and many times these renters are hiding in plain site.