Dealing with bad tenants is perhaps the most challenging part of being a hands-on landlord. In the last few years, many individuals withdrew money from their financial investments to buy property they then lease to tenants, especially to foreign workers who are employed locally. Still, buy-to-rent investment comes with significant risks.
A Times of Malta article listed several cases where landlords dealt with troublesome tenants who refused to honour their rent obligations or engaged in anti-social behaviour. Many landlords complained about the delays in obtaining legal remedies to recover their costs and losses.
Dealing with bad tenants can be a nightmare for landlords, causing financial stress and sleepless nights. Whether it is paying their rent late every month or not at all, damaging your property, or engaging in anti-social behaviours such as drugs, noisy parties, playing loud music, keeping inappropriate pets or causing parking issues, bad tenants do not just create problems for landlords but also for neighbours, leading to endless complaints.
Housing Authority data suggests that most landlords now only own one or two properties, with a fifth buying their rental properties through a buy-to-let scheme. While many aspects of property management can be rewarding, lack of experience makes dealing with bad tenants one of the most stressful and costly issues landlords face. The dream of receiving rent income on your account punctually often becomes a nightmare, especially if one has serial defaulters as tenants.
Taking legal action will always be a last resort. Landlords are correct in complaining about how slow the cogs of the legal system move. The authorities can and must address the endemic delays in our courts. Still, the best strategy to avoid dealing with bad tenants is to minimise the risks before signing a lease agreement with a tenant.
The first step that landlords must take is to engage in tenant referencing to protect themselves against troublesome tenants and maximise the chances of having a successful tenancy. Regarding references for landlords, you are putting a jigsaw together, building up a picture of the tenant’s renting history, including whether they have defaulted on rent in the past or caused malicious damage to a property. No tenant should really be spending more than 30 per cent of their income on rent. Affordability is key.
At a minimum, landlords must obtain proof of identity from the tenant, employment confirmation and income evidence. It is also good to ask for a reference from the tenant’s current landlord if they have one. If a potential tenant successfully comes through a rigorous selection process, one can offer them a tenancy. Landlords must not be tempted to cut corners on this, however tempting that may be.
A well-written rental agreement is also an essential requirement.
Conditions must include the prohibition of anti-social behaviour, including very loud music, TV or noisy parties, noisy walking about on floors in apartments, rubbish outside the property or blocking fire escape routes with rubbish, barking dogs, drunken behaviour and intimidating or harassing people.
While becoming a landlord by investing in a buy-to-let property may be attractive to those trying to supplement their income, there is no certainty that it will be as hassle-free as receiving interest from your bank account punctually.
The feeling of powerlessness that often accompanies the landlord-tenant dynamics can exacerbate stress levels, leading landlords to feel frustrated and helpless in the face of tenant misconduct.
By prioritising tenant selection and property management practices, landlords can minimise the impact of bad tenants and protect their investments in the long term.