Not every tenant will want to rent your unit on a long-term basis; some might want to stay for one lease term while others may stay for as long as five years. It all depends upon the tenant’s living requirements, the relationship between the tenant and landlord along with several other factors.
If your current tenants are good then of course you will want to renew their lease. The decision to renew their lease depends upon a number of issues such as the tenants paying rent regularly and have a reliable/steady mode of income. They keep the property neat, clean and damage free to a great extent and take care of it as you personally would do and never create trouble for neighbors.
Now let’s examine the various benefits of keeping the tenants for long by renewing tenant lease.
1.Save the hassle of finding new tenants
It is probably one of the most important and useful benefit of renewing tenancy lease. Getting your current tenants to renew their lease will save you the hassle of finding new ones. Let’s admit that tenant searching is quite a time-consuming and exhausting task. Equally tiresome is the phase of property inspection; every day and sometimes multiple times in a day you will be receiving calls and people will visit the property too. Going through the trouble of showing your rental unit to every interested tenant sometimes will be stressful for you.
Furthermore, the task of screening your tenants properly so as to avoid issues later on is another important yet exhausting one. Until and unless you screen your preferred tenants you cannot be sure whether they are the right one for your property or not. This also involves a variety of time consuming steps. You will have to counter check all the personal, professional and financial information provided by the tenants. You will be making the calls to their previous and current landlords, employers and internet background screening tools in order to check for any criminal record. Finding the right tenant is so time consuming that it is usually better to prevent your current, good tenants from moving out.
related: Opt for screening services
2. Vacancy Costs evaded
Finding new tenants is not only time-consuming but financially burdening as well. You need to either pay for tenant screening services, or if searching on your own, you have to pay to newspapers or other forms of print media and websites for publishing your property ads. Moreover, there are holding costs apart from marketing costs that are associated with a vacant property. Holding costs means the financial loss that one has to bear when the property sits vacant. The more time passes, every month the landlord will bear the loss. On the other hand, property taxes, insurance and mortgages will be paid every month. This means landlords will have to pay it while the property remains vacant.
By ensuring continued, long-term tenancy you can easily safeguard your financial stability and expect regular rental income. It is also beneficial for your property as it won’t stay vacant or suffer any damages and wear and tear at the hands of new tenants.
3. No need to conduct Property Turnover
You won’t need to turn over the apartment if you can get your current tenant renew the lease agreement.
If you were going to be trying to impress new prospective tenants, the apartment would have to look immaculate. To do this, you will conduct thorough cleaning of the property after the tenants move out then repaint the entire property, re-stain the hardwood floor, fix broken pipes and tiles, look for holes in walls and eliminate termite/bugs etc. If the property requires complete renovation then this would increase the expenses a lot more than you expect. If you can keep your existing tenants then you won’t have to carry out the overhaul as the renters may only ask for routine maintenance and repairs.
4. Option of Increasing Rent Upon Renewal
Usually, landlords wait until the end of lease of their tenant and then increase the monthly rent in the renewed agreement. Depending on the laws of the state you reside in, you can only increase the rent up to a certain percentage each year and as long as the new agreement is signed, you will be getting more rent every month. Landlords typically send the tenant a notice explaining the increase in rent. This notice is sent between 30 to 60 days before the lease is up for renewal.
5. Mutual Camaraderie
Having new tenants means you need to explain all the rules once again, keep check on the renters regarding observation of the rules and property maintenance and learn to deal with the new renters. There will certainly be a learning curve for not just the landlord but the tenant as well. You need to make sure that the new renters observe quiet hours’ rule and understand the policy you have determined for making complaints of repairs. Adjusting to the new renter is not always and easy task as there may be issues like delayed payment of rent or wear and tear of the property with the new tenants. The existing tenant would already be familiar with the lease terms and understands the process of rent payment, repair requests and quiet hours.
Therefore, it is a wise idea to keep the current tenants if you have found them to be good enough to let them occupy your rental unit for longer period.