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Tenant Turnover, the Landlord’s Dreaded Moment

KitchenWith my 24+ units, tenant turnover is inevitable.  In my case, it happens every few months, to the tune of six to eight per year.  Tenant turnover is not all that bad, if you get great tenants to start with.  It’s when you have a marginal tenant that apartment turnover is a lot of work. My tenant in one of my buildings sent me the dreaded tenant turnover email.  Sometimes I get a text, sometimes an email; sometimes it’s just verbal if they see me in the area.  I have yet to get a formal move out letter in writing, even though the lease says it must be in writing.

To enforce a written letter with great tenants is unnecessary.  If a tenant is breaking the lease mid-term, I will give them a lease termination form, as I don’t want two ‘live’ leases on the same apartment.  Or if I think I will need to get the tenants to move, and I want them out, I will also use one.

So here is how the email went.

“I recently got accepted into Grad School, so we are moving to Wisconsin. Unfortunately this means we will not be renewing our lease at the end of June.  So our last day in the apartment will be June 30th.

We will make sure to have it cleaned out before then.  We have truly enjoyed living here and are very sad to leave.  The community is wonderful and we have yet to find such a wonderful apartment where we are moving.

We also really appreciate how helpful you have been and the maintenance staff.  If you have any questions please let us know.  Thank you so much for renting to us.”

These were great tenants.  Whenever I had a showing in another unit in the building, I made it a point to knock on their door and let the prospective tenants talk to an existing tenant.  They always said great things about the apartment, and I think I may have rented once or twice because of it.  I kept up on the maintenance, and any reference to ‘staff’ was me, or a mistype.

The Credit scores for these people were 644 and 625.  Slightly below average, but both were recent college graduates.  Neither one had a single negative credit account on their reports.  Both had 12+ accounts.  Often you see younger people with 700+ credit scores, but it is easy to have great credit when you only have two accounts and have only had them for six months…

Both were professionals, right out of college.  One was a software engineer, the other a purchasing person.  Between the both of them, they made at least $75K per year, more than seven times the $975 monthly rent.

I never had a late payment from these people during the two years they were in my apartment.  They fulfilled the lease, 100%.  They gave me over 60-days’ notice, even though the lease says 45 days.

I am not sure what condition the apartment will be in when they move.  I suspect that it will be 100% move-in ready by the time they leave.  I have a $1,000 security deposit that says it will be move-in ready, if they want the money back.  I have no doubts for these tenants, the place is spotless otherwise.

So, in the next few days, I will deliver my move-out checklist, and a C/D with the 66 pictures and video that I took just prior to them moving in.  The pictures will help them remember what condition the apartment was in on their first day.  I will start an ad in Postlets, and begin the on-line marketing process.  I do not advertise in a hard copy newspaper, it is too expensive, and people without a computer are generally not great tenants.

At some point soon, I will start a Craig’s list ad.  The rent will be slightly higher, and will be back to market priced.  I had not raised the rent in two years, so I will probably start at $1,025.

I will set up some times that I can show the apartment with the current tenants, typically a couple of days during the week between 6:00 PM and 7:30 PM, and one weekend day between 11 and 4 PM.

I do not show properties during the day; I work my ‘real’ job during the day.  I also want people that work a normal shift, just like I do.  Night shift workers can be a problem in an apartment full of day workers, and people that do not work have to come out when I am available.  If they rather party during those times, so be it.  If the bus doesn’t run as often between those times, it is not my concern.

I pre-screen the tenants over the phone and in emails, so I do not bother existing tenants with the new ones.  When I show an apartment, I have generally talked to 20+ people.  If I show the apartment to 3 or 4 qualified people and I do not get an application, I will lower the priceIt really is that simple.

What is your process for moving out of your rental, or preparing your rental property for new tenants?

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