Many components go into a successful rental property. Marketing it for the right price, making sure there is demand from renters and deciding on the type of let are just a few. However, the most important factor is arguably the tenant who will live in your rental property.
Before a tenant moves in, they need to go through referencing to validate their suitability. While professional tenant referencing can reveal elements like their financial details and whether or not they have good credit, it can’t tell you what they’re like as a person.
After all, you don’t want someone renting who has a history of late payments, doesn’t treat your property well and is a nuisance to neighbours. But how do you decipher someone’s overall general behaviour? The answer lies in a landlord reference letter.
Tenants with previous renting experience can get a letter of recommendation from their current landlord. This will give you a much clearer idea about their compatibility with your property.
In this article, we will tell you what makes a winning reference letter so that you can let to your new renter with complete peace of mind.
A letter of recommendation from a previous landlord is a form of validation. It confirms a tenant’s credentials as a professional renter, using their previous experience with the renter as a barometer. Essentially, it says the tenant can carry out responsibilities such as paying rent on time and looking after the property while it’s their home.
Within the letter, the landlord will confirm some key aspects. These include:
The letter will also include general information about the tenant’s behaviour while they rented the property. General information can include:
All of the above information makes up the crux of a landlord reference letter and is what new landlords should look for when vetting potential new tenants.
The majority of reference letters come from the previous landlord, who is in a good position to provide information on their outgoing tenant. Sometimes though, tenants rent from a company, with the company acting as the landlord. In such a scenario, one of the employees should be able to provide a landlord reference letter.
If the renter doesn’t have any previous renting history, they are often required to provide a character reference. A character reference typically comes from employers or university lecturers, depending on the tenant’s professional status.
Landlords should make sure they verify the source of any reference letter, whether it’s from the previous landlord or a character reference from an employer or educational institute. Doing so will help to safeguard from any form of fraud.
There’s no set requirement for a landlord reference letter, other than confirmation of the renter’s general ability to be a good tenant. However, there are some elements you should look out for that signify a winning landlord reference letter. These include:
A previous landlord should tell the truth about their tenant. If they don’t, they are misleading the new landlord with misinformation. Doing so could come back to haunt them, as the new landlord can sue for misrepresentation.
A good landlord reference letter signals to the new landlord that they can contact the previous landlord for more information or clarification. Even if it’s just an email address, providing a line which states they can be contacted for more information shows professionalism.
No matter the contents of the letter, the tenant in question should always be referred to respectfully. It should be written in a way where the tenant could read it without feeling insulted, even if it doesn’t strongly recommend them. The landlord should also be able to back up all claims in the letter.
[Former landlord’s name, address, email, phone number]
To whom it may concern,
[Tenant in question] was my tenant at [address, unit] between [move-in date] and [move-out date]. [Tenant] paid their bills on time for this [type of property] and was cooperative for the length of the lease. She/he was respectful of her/his unit and the common spaces. [Mention of the handling of any particular landlord-tenant issues].
I would recommend [tenant] as a tenant and would sign them to another lease should they wish to rent with me in the future. Please feel free to contact me for any necessary elaborations.
A reference letter from the previous landlord offers valuable insight into a renter’s overall behaviour while they were a tenant. But it should accompany other professional checks and act as added material for finding out all the necessary information.
It is recommended that landlords still undertake professional checks on tenants to see if they have good credit and can afford to make the monthly rental payments. In the UK, it’s suggested that tenants make 2.3x the annual rent, and this can only be verified with a professional check.
Sometimes it might be necessary to get character references alongside landlord reference letters. These often come from people the tenant has known for a sustained period of time. They shouldn’t be relatives, however. Instead, former colleagues and mentors are often good fits for providing character references.
Every landlord wants to make sure they get high-calibre tenants, which is why it’s crucial to be able to identify the traits of an excellent renter. As a landlord, you should look out for the following criteria:
It should go without saying that tenants need to take care of the property they are renting. It will ensure their security deposit remains intact while also displaying their responsibility. A tenant who takes good care of the property will also likely be quicker to report maintenance issues that may arise.
There is a fine line between landlord and tenant communication. Landlords want to know their tenants are capable and don’t expect to get requests to change a lightbulb. However, they shouldn’t be silent tenants who hardly communicate damage, for example, to their landlord. Being a landlord is a business. For the business to run smoothly there needs to be a solid relationship and good communication between the two parties.
Before the tenancy commences, both tenant and landlord will agree to a lease that states the terms and conditions of the rental. An AST (assured tenancy shorthold) is the most common form of lease and typically lasts for 12 months. There will be specific stipulations (whether the tenant is allowed pets for example) within the contract. As the tenant has agreed to the terms, it’s important that they don’t violate the lease and that they stay in line with the contents of the contract.
At Blueground, we screen all tenants before they rent an apartment, using relevant tenant referencing services and a payment schedule that ensures timely rent collection. Therefore, as the owner, you can feel secure about who is staying in your property, without going through the hassle of vetting them yourself.
Blueground’s premium flats around London attract senior business executives, professional athletes, and diplomats, amongst others who are looking for a multi-month lease. Regardless of whether we’ve leased out your space or not, Blueground acts as your tenant. This ensures you’ll get your passive income no matter what.