How Good Property Management Training Can Change Tenant Behavior

Some would say that part of property management training that involves dealing with tenants is more art than science, and with that I’d have to agree.

I’ve been actively managing people and managing property for almost 30 years and, knock on wood, probably 99% of the time things go very smoothly.

But that 1% is what really makes you sit down and think hard about what’s going wrong with your management training.

How To Learn From The 1%

Maybe I’m lucky, but when I manage people things go pretty well. The group is cohesive, there’s not too much drama or politics, and everybody is moving toward the same goal. Same thing is true about our property management training classes.

But there’s the occasional employee that no matter what you do simply won’t cooperate.

And the weird thing is, these people tend to be the smartest ones in the bunch.

So what gives?

When we’d get together for the employee review I’d actually ask this question point blank and the employee would tell me exactly what they were doing wrong.

Which would baffle me. I mean, if you know what you’re supposed to do and if you know what you’re doing wrong, how hard is it to change your behavior?

That’s Your Job Not Mine

The answer I’d always receive from this 1% is that while they know all of this, that it was my job as a manager to change their behavior, not theirs.

Managing tenants isn’t quite the same thing as managing employees, but they’re both people, and like they say, people will be people.

One of the most effective property management training tools I’ve found to change tenant behavior is to set the right expectations.

Tenant-Friendly Leases

Often we’ll be managing a multi-tenant real estate investment with leases already in place that bind the new owner to promises made by the previous owner. Many times, for whatever reason, these leases are overly tenant-friendly, to the point that the previous landlord has actually given up rights that she’d normally be entitled to.

I see this with the rent due date a lot of times. For example, if by law and by a standard lease contract the rent is due on the 1st and delinquent on the 5th, I’ll see the delinquent date stated as the 10th in the lease.

Clearly this can wreak havoc with your cash flow, particularly in the case of tenants that push the envelope, and the 10th can quickly become the 15th. If you’ve got a mortgage on the property, odds are your payment is due before the 15th.

Would You Rather Be Paid Now Or On The 15th?

Assuming you can’t amend your existing leases, the easiest way to improve your cash flow and get more of your rents coming in by the first is to send out monthly billing statements at lease a week before the due date of the 1st of the month with a note on the statement that rent is due on the 1st.

If needed, send a follow-up statement on the 5th as a reminder that rent is due on the 1st, or make a follow-up phone call or visit to the tenant, to make sure that the tenant received the statement.

Don’t say anything about the due date of the 1st.

You’d be surprised at how effective this simple property management training tool can be.

We’ve taken over the management of many properties that have leases like this, and usually within two months of using this technique almost all of the tenants are paying by the 1st or even sooner.

Sugar Is Better Than Spice

The nice thing is, we didn’t have to coerce, didn’t have to threaten, and didn’t have to charge late fees.

For the price of a first class stamp, a piece of paper for the statement and some printer ink, we were able to move the majority of our cash receipts up by 10 days.