“Wisdom gives a man patience…”
Proverbs 19:11
I was watching the Carolina Panthers play the Buffalo Bills
yesterday and it was not pretty for us Charlotte folk. The football game turned into an
old-fashioned whooping, 40-9.
The Carolina Panthers quarterback, Andy Dalton, had a bad
game. He was intercepted once, fumbled
twice, and took seven sacks. One of the
reasons for his poor play was that he held on to the ball for too long. The Buffalo’s pass rush was coming furiously
each down and he needed to make a quick decision on where he was going to pass
the ball. Instead, he was indecisive; he
held on to it and his team suffered the consequences of all the lost yardage
from the sacks he took.
However, the biggest detriment to the team were the
turnovers he created. When Dalton tried
to be decisive and go for the big play, he had an interception and two
fumbles. Lost yardage from sacks is
certainly bad, but turning the ball over to the other team is much more of a killer. A general truth in football is that the team
that turns the ball over more usually loses.
In fact, statistically, if a team turns it over 3 or more times, they
win less than 10% of the time.
This reminded me of general truths that I’ve learned as a Charlotte property
manager. They are “general truths” (and
not “truths”) because they do not happen 100% of the time, but they definitely
get my attention when I see them. For
example, in my experience, it is common to receive below-average rental
applications from prospective tenants who are:
- Overly-complimentary of a
rental house
- Really nicely dressed
and/or wearing a suit when we meet
- In a big rush to get
approved and move-in
The focus of this blog is on #3.
After BDF Realty gets a rental application, we communicate
to the prospective tenants that we’ll try to have an answer on their approval in
2-3 business days. The actual length of
time usually depends on things outside our control like when past landlords
return our calls, how well the rental application is filled out, when we receive
proof of income, and how busy we are.
Most tenants understand that running rental applications takes a certain
amount of time.
However, sometimes certain tenants begin a drip campaign of
pressuring us for an early decision on Day 1.
We’ll get e-mails about how they need an answer right away in order to
give proper notice to their current landlord, how their last (approved) rental
house had fallen through which put them in a bind, they’re approved for another
house and are going to go with that one if we can’t give an answer soon, and they
need a signed lease to immediately submit to school/aid/jobs/etc.. These jabs begin on Day 1 of submitting the
application and start to crescendo on Day 2.
Now we’re receiving phone calls and e-mails every hour or two wondering
what the hold up is and when we can give them an answer.
At this point, we’re feeling like Andy Dalton. The prospective tenant pass rush is mounting
and we are feeling the heat. The tenant
is pushing us for a decision and our owner clients sure would like to have an
approved tenant for their empty rental home.
The only party that is holding things up is the property manager,
us. Why are we taking so long?
Dalton drops back to pass and doesn’t see anyone open. Does he force it to a covered receiver and
hope he can come up with the contested ball?
Or wait a little longer to see if another receiver is able to run
himself into enough open space so he can fire in a pass but risk taking the
sack? Or does he throw the ball away to
avoid a sack, interception, or fumble?
It can be a tough call.
We all want to be the hero and make the big play!
I believe smart landlords need to hang tough. To extend the analogy, sacks (losing tenants
who demand a quick answer before getting all the data back) and throwing the
ball away (losing tenants who do not provide all the required applicant
information) can be good plays to avoid turnovers (bad tenants). Turnovers lose games. Bad tenants are really costly: missed rents,
home damages, attorney fees, sleepless nights, stress, and wasted energy. The cost of missing on a risky tenant in
exchange for extra vacant days on the market pales in comparison.
Andy Dalton is successful if he can make quick decisions and
avoid turnovers. Smart landlords want to
avoid turnovers (bad tenants) as well, but can afford to be less quick to come
to a decision. However, both need to make
good decisions under pressure regardless!
Happy Landlording!
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