How to pick a tenant you’ll actually like

Attract the right tenant and rule out any awkward situations down the track.

How to pick a good tenant

It may seem like Tinder for renting, but finding the right ‘match’ for your investment property is a big deal. From placing listings, to screening potential candidates and verifying their identity, finding a tenant who will pay the rent on time and not burn the place down, isn’t always an easy task.

So as a landlord and property investor, how do you go about choosing a tenant that lives up to your expectations?

Target Market

Start back at marketing 101 - visualise your rental target audience. Depending on the property type, you need to carefully consider the type of tenants you’d like to attract.

For instance, do you have an inner city studio apartment located near a university? Or a three bedroom unit in a family-friendly suburb? This will determine the type of people you can expect to apply and therefore would need to screen.

As well as fitting a certain demographic, your future tenant/s need to tick the right boxes in terms of financial and behavioural tendencies;

  • Do they have the financial means to pay the upfront payments (i.e. the bond and advance rent), as well as the regular rental payments?
  • Do they have the discipline to pay rent on time and in full?
  • Will they respect your property?
  • Are they honest?
  • Are they assertive? Will they communicate when repairs or extra maintenance are required?

How to find and attract prospective tenants?

If you need help finding ‘the right one’, you can enlist a property manager to facilitate the listing and screening process.

But if you’re going solo, then you’ll need to think about where you’d like to advertise your property online, including sites such as

Take the time to write a well written and attractive ad without over embellishing, you want to sell your property to the best possible applicants. It’s also important that you use quality photography to capture the angles and features of your property adequately. After all, you want to do it justice.

If you present the property well, you’ll be more inclined to attract tenants that will want to look after it, and maintain its existing quality. So before you have any inspections do a thorough clean both inside and out, present the property as you would like it to be maintained.

Do you have landlord's insurance?

To set the rental amount, speak to your local real estate agent about the current market conditions and observe what other properties in the area are charging to give you a ballpark figure.

Once you’ve posted the ad, you should spread the word on the grapevine, as a friend or family member may know someone who would be a good fit for you.

Another way to attract future tenants is to keep your property updated with modern amenities that would appeal to your target demographic. For instance, if you know that potential tenants in the area will be expats, you may want to think about offering a furnished property which would appeal to those relocating from overseas.

Screening & References

It’s essential that you dedicate some time to reviewing and screening your candidates by checking at least three references from previous employers, property managers or personal affiliates.

The biggest factors to consider about a potential tenant are; can they afford to pay rent? And do they have the ability to maintain the property?

Can they pay the rent?

You should review the tenant’s salary to determine whether or not they’ll be able to afford the requested rental payments.

To do this, you’ll need to confirm their employment status and communicate with previous and existing employers to understand the stability of their employment and income.

Contact the applicant’s employer and ask:

  • Is the applicant’s employment permanent or temporary?
  • Are they loyal? How long has the applicant worked for the employer?
  • Is the applicant punctual, responsible and reliable?
  • What are the applicant’s prospects for continued employment?

If their self-employed, you can ask for their accountant to provide confirmation of business ownership and cash flow for the past two financial years.

Do they have the ability to maintain the property?

When it comes to maintaining your property, who better to vouch for the tenant’s property upkeep and general respect than their previous landlord?

The tenant’s current or previous landlord or property manager can provide a reference for the tenant’s track record of looking after the property, as well as evidence of their rental payment history and behaviour.

Contact the applicant’s previous landlord and ask:

  • Did the applicant give adequate notice to vacate the premises?
  • What was the state of the property when they vacated? Was it well looked after and cleaned?
  • How long did the applicant live at the property?
  • Did the applicant pay rent on time?
  • Did the applicant have pets?
  • Would you rent to the applicant again in the future?
  • Were they relatively easy to deal with?
  • Were there any communication problems?


An investment property needs to be protected in the event that something goes wrong. Landlord insurance takes care of the property and the contents you provide for the tenant’s use, and often provides the optional cover for rent default and theft by the tenant.

As a landlord, you should request a bond and advance payment from the tenant prior to them moving in. This provides you with security in case the tenant breaches the terms of the tenancy agreement or if things aren’t smooth sailing. Keep in mind, however, that the bond should not exceed the equivalent of four weeks rent.

Identify verification
Don’t approve a tenant if you can’t prove who they are. Check out their driver’s license and/or a passport or proof of age card so you know who you're really dealing with.

Keep in mind that non-Australian passport holders should supply documentation that confirms their visa status to prove their legal entitlement to reside for the term of the lease.

Warning signs to be on the lookout for:

  • Rental history. If they’ve moved back and forth between properties, this should raise a red flag. Perhaps ask the applicant why this has occurred and check to see if there’s any outstanding issues with previous landlords.
  • Failure to supply requested documents. If the applicant doesn’t want to provide any of the documents you have requested as part of the application process, or is slow to provide them, this may be a sign that they don’t have a good rental track record.
  • Finding fault during inspection. During the inspection, if they’re finding small faults or issues when you know and have made sure that the property is in good condition, this may signal that they will be constantly asking for repairs, or pointing out issues, in future which could cost more than it’s worth.

Landlord insurance could be your new best friend

Picked a bad tenant but didn't realise until it was too late? That's okay - landlord insurance has your back.

Landlord insurance covers you for loss of rental income, damage to your building, protects your contents, and gives you a bunch more benefits (like replacement of locks, removal of tenant's possessions, and covers your legal expenses).

Compare landlord insurance policies below

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Belinda Punshon

Belinda is a journalist here at Specialising in the home loans and property sections, she is passionate about helping Australians improve their financial wellbeing.

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