Having your tenants pay their rent on time is key for successful investing; incentivizing them to pay can sometimes be worthwhile. Here are a few ways that we have found to be the most effective.
- Incentivize them to pay early by offering a discount
Let your tenants know that if rent is paid in full on or before the first of the month, they can deduct a certain discounted amount. If they chose to pay rent after the first of the month, the standard rent is due. Always be sure your offering is clearly defined so there is no confusion.
- Have a point system that allows for upgrades.
Create a system for each time they pay on time they receive a certain number of points toward an upgrade ie: accent wall, new flooring, or maybe a gift card to home depot for their unit.
- Offer A Community Drawing Every Few Months
Create a system that when they pay their rent on time they receive a token/ticket of some kind to throw into a drawing. Individuals who have more tokens/tickets will have a better chance of winning over someone that doesn’t.
- Make It Easy For Them To Pay
The easier it is for them to pay the better, online or automatic payments simplify the process.
- Send Reminders
Sometimes, a tenant misses a payment because they’ve simply forgotten the exact date that rent is due. Send your tenants a gentle monthly email reminder a couple days prior to the rent due date.
- Maintain A Good Relationship With Your Tenants
People tend to want to work with people they like. When you’re a landlord, the tenant becomes your client and you should respect and treat them as such. Take the time to get know them. Respond to their inquiries, and keeping an open line of communication will go a long way in nurturing tenant relations. Keep in mind, a tenant who is deciding between which bills to pay will most likely pay the person who they have a good relationship with, first.
Good tenants can be hard to find so try to work with them as best you can before cutting them loose and spending the money to find new tenants that could potentially have the same issues.