Tenants - One of the Team ?

From: C M


“Zee boiler…..acht, it’s nine vorking” My German tenant was in the middle of a sub-artic English winter, with Jane Eyre gales blowing around her schnitzels and once again, the demon of the boiler had reared it’s ugly head.
“Clay…mine fingers are freezing no? Pleease to do sumpsing, as I can’t be sooo cold. Zis is not a happy situation for me”. No, I guess not.

The boiler had started to become a problem and I had already had a succession of plumbers go and treat the hot box but every now and again it would have a turn and decide to take a vacation. Always in winter. I always thought hitting any appliance fixed it, as I grew up in a house where everyone hit anything that didn’t work; toaster, kettle, TV, radio…all were regularly bashed, throttled and shaken to get them to comply. Shouting always helped too! Alas, my boiler didn’t know the rules or else was refusing to understand the nature of things… humans hit objects… objects then work. Time to call out the plumber again…ugh!

A few days later, my plumber phones to tell me that there is nothing wrong, it’s just the tenant keeps doing something that she shouldn’t. I was beginning to feel beads of irritation forming on my forehead. “Yeah mate, it’s like, she keeps doing this fing, ya know, and pulling this button and I keep telling er that she as to stop but I cant understand er, cos she foreign in it? She won’t listen. Still, I won’t charge ya, as it only took me a minute or two” There is a God! A plumber who doesn’t charge a callout fee…! He explained it all to me and I made an appointment to go over and “fix” my froline!

“Clay…oooohhh, sooo cold, soo glad you come round ya!”
The apartment is freezing and her two icicle earings look great but the living room rug draped around her head is not the look of the season.
“You mustn’t touch this switch, pull this button or in fact, touch ANYTHING within a 3 meter radius of this boiler….ya?!” I state firmly.
I stayed for a while, showing how the boiler worked, what things did what and why the process of life and boilers should never be interfered with. Language is always a barrier and as my German doesn’t exist, lots of arm waving and international signing were required. After some effort, the curtains opened, rays of light shone through onto her face and divine illumination was bestowed on her…
“Aahhhh, so not to touch zis, press zis or go anywhere near any of zis ya?” I could have kissed her, except it wasn’t written into the rental contract, so on the advice of several lawyers, I refrained.
“Yes, yes, YES!” I shrieked “Yes….KEEP AWAY from it all!”

Few investment books tell you of the joy that comes from interaction from tenants! It’s all to do with crunching the numbers, studying the trends and being a savvy and astute investor. However, to not concentrate on the tenants is akin to starting a poodle parlour but having a sign saying “No dogs allowed”. “Ahh” you say “that’s why God invented property managers”.

On p69 of her new book, More Wealth, Jan Somers shows a pie chart, explaining how a tenant pays 63.3% of the costs associated with owning a property. Sounds a reasonable statement to make….as a ball-park figure. In most business, you would say that someone that exerted this much control would be a majority shareholder wouldn’t you? They could throw their weight around and make a thorough nuisance of themselves and you would have to kinda go along with it a bit – or else leave the business?

After I wiped the beads of irritation away, I too had a curtain opening, miraculous giddy experience. I like to call it my investor/tenant awakening! This woman was contributing the major cost to my future well-being. She was funding a large part of my future plans, goals and ambitions. Each month, she was willingly carrying the majority load of my financial commitment, as it related to that property. Without her being there, month in month out, my plans would unravel. Tenants are a massive leverage tool. Find enough of them and have the ability to KEEP enough of them and you can place an ever-increasing financial burden on their shoulders and they will carry most of the load for your future success. Learn to understand what they need, the small luxuries they appreciate and you end up finding one of the most important members of your wealth building team. They are often considered something you just have to deal with as a consequence of property investment. One of the areas that can cause financial strain is to have a high tenant turnover, tenants that are forever complaining or being uncooperative. Treat them as a shareholder in your business, a major financial contributor and you will find that things can improve dramatically. Keep them warm in the winter and cool in the summer and don’t expect them to live with orange swirly carpet with lime walls!

So now I send my tenant vouchers at Christmas to her favourite women’s store, I send cinema tickets to a couple who have just moved into another property – cos that’s the sort of things young couples like to do, and after a stressful move, a night out might be well received. We leave them a list of how to bash, bang and hit all appliances and learn the ways of boilers, so that they don’t get irritated and think we are providing an average service. Consider sending birthday cards (find out from application form they fill in), send a relevant gift every now and again and be prompt with repairs and consider requests….doesn’t mean you always have to fulfil them. And if your first thought is “that cuts into my bottom-line and is it all tax deductible ?” then stop yourself….if it wasn’t for them, bottom-line and tax deductible don’t even exist! I think it might be known as ‘goodwill’. If we, as investors, are requiring of ourselves to achieve more than your average Ozzie landlord, then by the same token, require of yourself to provide more than the average Ozzie landlord…..you’ll be well-rewarded over time and gain a great reputation.

Happy landlording/landladying/landpersoning!
 
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Reply: 1
From: Joanna K


Fantastic!!

I used to have a "tenant of the month" when I was running The Rental Specialists.

The prize was usually a dinner for 2 or movie tickets or something like that. Sometimes, if the rent was cheap, I'd "give" them 1 week's rent free.

And the winner was judged by their rental payment history, the outcome of their periodic inspection, or just generally good tenancy.

It really worked a treat!

Kind regards

JOANNA
 
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