The Landlord Lens - Perceptions of Landlords

Episode Date: January 14, 2024

In this episode of Be A Better Landlord, Krista and Jonathan tackle the tough topic of the public perception of landlords. We explore why landlords are often seen in a negative light, discuss the common myths and stereotypes that surround them, and offer actionable tips on how to build trust and positive relationships with your tenants.

I'm Jonathan. This is Krista. We're here to help you be a better landlord. So Krista, we talk a lot about landlords. TurboTenant is software made for landlords. And today we're going to talk about the public perception of landlords. Let's start with why do some people hate landlords? Sure. Yeah, it's a complicated topic, right? Because it really requires us to take a bird's eye view of the housing market and the housing system as it's set up in America. Easy peasy. Right? We're just good.

But really, when we look at it, there are a few different situations at play from a systemic level. So first, of course, is the commodification of housing. When we can modify a human need, there becomes an inherent power struggle between the haves and the hafnots. In this case, the haves are going to be people who own property, the landlords. Have-nots are going to be renters. And because renters need somewhere to live, but they are bound to play within the rules set by the landlords, there creates an inherent friction between the two parties. With that in mind, there's also a twiddling affordable housing supply.

So it's not like renters could just exit the rental pool necessarily and buy their own property. Despite, you know, so many people wanting to do that, I think it's 60% of our renter population has less than $5,000 in savings. So it simply isn't realistic. And so they are thus feeling trapped in a process where they have to find a landlord who is going to charge them a monthly fee to live somewhere. And that doesn't feel good for people, especially if they don't feel like they're getting the value for what they're paying.

That's where the term slumlord comes into play, where people are charging outrageous rents or even moderate rents, but for very poorly maintained properties. And the tenant can't get answers. They can't get fixes. They are living in less than ideal conditions, but still having to pay this monthly fee. that creates a lot of unrest and bad will between the two.

Yeah, that all makes sense. And the last few years have been brutal for the housing market, for real estate. COVID-19 did strange things to the housing market. Very strange. There was the eviction moratorium, but then, of course, rental prices skyrocketed in most cities. And in the past few years, housing prices have also skyrocketed. And now, of course, we have super high interest rates, which will hopefully be easing sometime soon. but I think all of that kind of works together for people who can't afford a house right now to look at those who can and say, you're the worst.

Yeah, especially if they're not getting the value that they're paying, right? I mean, we've heard of a situation from a renter whose ceiling fell in, and her landlord didn't even act within two weeks. So there's just a gaping hole in the ceiling. And when the tenant went to their landlord and said, hey, I had to pay for a hotel to go and, you know, protect myself after the ceiling fell in, can we take this off of the monthly rent? There's pushback saying, well, next time we should go splitzies on this, which is just not the kind of situation you want when your ceiling has fallen in. And you want to live somewhere safe.

So I think it really boils down to tenants wanting to feel safe and secure in their home, but also recognizing that their home is owned by someone else who can make their own rules and who has their own ways of doing things, which might not jive with what they want to be doing. So it's unfortunate because there are really. great landlords out there. They just don't pop up in the news as much as your terrible landlords, your slumlords, the people who are just really making a mess of the housing market and creating this negative public perception. Yeah, and of course that gets into a bigger problem of just the new cycle and our tendency to focus on the pessimism as opposed to the optimism.

But our goal here at TurboCentent and especially with this show is to make people better landlords and a huge part of that is making them better to their tenants, right? They're providing a service. They should be treating it as such. They should be just being better people. Yeah, really. I mean, I think the thing that gets lost so often in conversations about real estate and investing in real estate is the human aspect. This is a human business. You are dealing with people, even if you have a property manager and your name is on none of your properties and you are the most sequestered landlord in the world, you are still involved in a human business. And at the end of the day, you cannot treat your tenants like they're just members. That's where we see people fail the most.

That's where we see landlords become slumlords. So you have to keep that relationship at the forefront and really be proactive in terms of taking care of the people who are taking care of your property. That respect really pays off. It goes both ways. So if you can set it up well from the beginning, you will see it pay dividends at the end. Yeah. Yeah, that sense of hospitality should not be loss at any stage. Yeah. So we have served over 500,000 landlords at this point, and many of them don't own that many properties, right? They're the one to five, one to ten maybe rental properties on average. And we've seen a lot of great ones. We have a lot of really good landlords using our product. What can people do to be better landlords? Love that question. I would say set yourself up for

success by having designated processes in place that enable you to communicate with your tenant. regularly, cleanly, and with a timestamp. So to me, that means using our messaging feature as you're all in one to communicate whatever you need with your tenants, right? If you just want to check in on them, send them a quick message. If you want to follow up on a maintenance request, do so. In fact, you always should because you want to ensure that that problem was actually resolved. And if you make that a habit from the very beginning, it becomes second nature to you.

So you are just automatically being a good landlord by taking care of these different pieces. but it doesn't feel like extra work. So communication, having good processes in place, and of course taking them seriously, treating them as human beings. You know, if somebody comes to you with a complaint that you feel a silly, you don't have to treat them like they're dumb.

It's real to them. They're bringing it up to you. It's a matter of having the interpersonal skills to hear them out, make them feel heard and then decide what kind of actions need to be taken, if any, at the end. So we send a newsletter every Friday called The Key, And in there, we always have a community question that we ask all of our users.

One of them recently was based on a question that we actually got from one of our users, in which she was saying that she had a great tenant, didn't need to raise the rent, but felt like she should because she was under market rent, but she didn't need the money. Yeah, there are a lot of very passionate responses. The vast majority of them were saying, hey, landlord, if you don't need the money, you spelled out in your question that you don't need the money. don't raise rent. A good tenant that you adore is worth more than the $600 that you could be charging for this if you're doing market rate. And this is a tenant who had lived there for over a decade. So there's a long relationship between this landlord and tenant, but they are feeling the pressure of, you know, this is a business. I need to be making the most money. And I would argue that you should ignore that urge as much as possible. I'm not saying that you have to never make money on your real estate investments. In fact, I think I would be out of a job if I said something like that. But I will say, to keep humans at the forefront, right? This is an elderly tenant who's lived there for over 10 years.

You have her market rate as $600 below what you could be charging. So sure, you could sit down and say, hey, Margaret, we're bumping up your rent. Good luck with that on your pension checks. But that really throws away the entire landlord-tenant relationship that you've built over those last 10 years. So don't do it. If you don't need the money, if you are still breaking, not even breaking even, And if you're still making money and you're in a comfortable spot and you don't need to charge extra rent, don't. Why? Your tenant needs that money too. And they're already covering your mortgage.

So you're already coming out ahead. So resist the urge. Resist the people in this space who are going to tell you to just charge as much as you can all the time, really grind them out. Because that loses sight of the human aspect of being a landlord. Yeah. And we see a lot of struggles between the human aspect and the business aspect. Both are important, obviously. Most people got into being a landlord because they wanted some sort of passive income,

wanted to save for retirement, et cetera. But I think talking about the business aspect for a moment, it's also important for you to have robust savings, right? Set aside a certain amount of money, and then there wouldn't be so much pressure to maybe gouge Margaret. Yes, exactly. Keep Margaret safe. Really by having, I would recommend at minimum three to six months worth of expenses,

saved. So that will help you stay less stressed if Margaret can't pay rent one month or if something else happens where you would otherwise kind of feel flustered. If you know that you have that money in your back pocket, you can be more humane and more understanding when tenant problems pop up. And you can find a long-term solution rather than a quick fix that might drive that tenant out and ultimately hurt your bottom line because then you have to find a new tenant and you have to do your marketing and you have to do everything. That could be a lot. So save yourself the trouble by being thoughtful from the beginning, set yourself up for success

and having good conversations with your tenants throughout the entire time that they live in new rental. Yep. And when that tenant moves out, you can always adjust the rent at that point before you get a new tenant to come in. Exactly. That's something really important to note. When they are moving out, you can then update the pricing, also make any kind of upgrades that you need to.

Having someone in one place for 10 years means there might be a couple things you want to touch up. But then you can charge market rate and you can find someone for whom that is not a detriment to your relationship and build something wonderful with that. Another important point that we have heard some of our users say is to make your rental into the kind of place you would want to live in. Yes. Very important. That's a great piece of advice because I think that really brings the human aspect to the forefront. If you would not live in your rental, you should not expect someone else to. It's the golden rule, right?

like you want to treat them as you want to be treated. So just make sure that you're doing that. Follow up if you send out a maintenance person. Make sure you know how that went. When it comes to birthdays and celebrations, send them a little acknowledgement. It doesn't have to be a $3,000 bouquet. It could just be a card. It could just be a text that says, hey, happy birthday. I'm so glad that you live in my unit. That's a really nice little gesture and it costs you nothing. But it furthers the goodwill between you two. And that can pay off one because that tenant is more likely to communicate with you if there are issues, whether that's financial or, you know, maybe some kind of maintenance issue that they might not otherwise feel comfortable bringing up. But also, it could help you get more tenants down the line because if one tenant has a positive relationship with you, when they go to move out, they might tell their friends and say, hey, I'm moving out of this great place with this wonderful landlord. You've got to go see it.

I think you'd really enjoy it. And then you have another good tenant, which is really fantastic. Yeah, if you can get tenants by referral, that really is the best possible solution. Yeah, absolutely. Okay, well, obviously we could talk about this topic for a long time. We're very passionate about helping landlords be better, both in their business and to their tenants. If you out there have any stories of great tenants or great landlords, we'd love to hear them in the comments below. The best landlord subscribe to Turbotenant, so subscribe today.

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