There’s silence as the tuxedoed magician puts his white-gloved hand into the shiny black top hat.
The magician pauses to make eye contact with the audience. The audience catch the magician’s steadying gaze, and holds its collective breath. The tension is so acute that you could hear a proverbial pin drop onto the function room’s carpeted floor.
Happy that he’s got everyone attention, the magician deftly reveals a white dove from the top hat.
The audience erupts into loud applause, as the magician takes a bow with the sleek white bird perched on his hand.
I’m sure you’ve seen similar magic tricks performed…
And each time you’ve seen such a trick, the magician makes it look effortless.
But to get to that effortless stage, the magician would have had many failures along the way. Failures like the dove flying out of the hat; or the magician just pulling out a few feathers; or the dove pecking the magician painfully.
There are a finite number of things that can go wrong with the dove-out-of-a-hat trick. In order to master the trick, the magician would have had so much practice, that he would have encountered each of the problems.
But once he’s encountered each issue a number of times, the magician will know exactly what to do. There are only so many variables that can occur.
There are also only a finite number of things that can go wrong for your tenants
When you’re dealing and negotiating with tenants, there are also just a finite number of things that can occur.
So when you’re negotiating with tenants, you’ll find that there are a set number of objections that a tenant will present you with for each type of problem. Tenant repertoire is quite limited, and with experience you will be able to head off expected responses before they materialise.
In fact, you’ll get accustomed to tenants’ objections, as you will hear the same ones time and time again!
How do you get to learn tenants’ repertoires of tricks?
It takes time and practice to get accustomed to tenant negotiation. Just like the magician had to practice pulling the dove out of the hat, and experience some failures along the way, you’ll need to put in time and practice too.
In time you will be fairly useful at reading tenants body language and being judgemental. You will even be able to assess a problem with fairly minimal contact with the tenant. It all comes down to having good communication skills.
Tenant communication: How to communicate effectively with tenants
Communicating with tenants takes time and practice before you start getting consistent results in your favour.
1. Have a clear goal in mind
When you meet or communicate with a tenant, you should have a clear outcome in mind. After all, how can you negotiate with people if you can’t identify the result you’re aiming for?
Just like the dove-out-of-hat trick, you need to be prepared for the finite number of things that tenants could bring up. If you’re prepared for this, there’s less chance of them derailing your presentation.
2. Communicate in a very specific way that’s not open to interpretation
Tenant communication needs to very specific: it must not be open-ended or open to interpretation.
Here are three examples of typical conversations a landlord may have with a common tenant problem.
Notice that the ‘typical’ statement is vague and open-ended, whereas the recommended phrasing is firm and clear.
Example 1: Late rent payment
Typical landlord comment: “When do you think you can make that rent payment?”
What the landlord should say: “Bob, I need you to have the outstanding rent paid into my account this afternoon by 3pm”.
Example 2: Rubbish in the section
Typical landlord comment: “It would be good if you can keep the back section tidy.”
What the landlord should say: “The back section needs to be cleaned up with all the rubbish removed from the property. I will be checking that this has been completed next Monday. I can arrange for a contractor to complete this clean up at your cost: so would you prefer to do the work yourself or employ a contractor for the rubbish removal? I can arrange a quotation for this.”
Example 3: Oil-stained carport floor
Typical landlord comment: “Can you give the carport a clean out at some stage?”
What the landlord should say: “The carport area is in a complete mess, I need it washed out and all the rubbish taken to the dump. You can see that your car has left oil stains on the concrete: this needs to be cleaned off with an anti-grease solution and then water blasted until the concrete is clean. Bob, I understand that you are very busy with family and work commitments, would it help if a contractor assisted you with the clean up? I’m happy to help you out here and arrange a quotation for the clean up and rubbish removal work – would that help?”
Reviewing your performance in negotiations
In your travels to becoming a seasoned negotiator, you need to consistently analyse each tenant problem to define what went well and what could be improved on next time. It is very important that you understand why the negotiation failed or why it became more drawn out than necessary.
The communication didn’t fail because the tenant is a ‘horrible person’ or because they don’t like you.
No, It failed because they may be a better negotiator than you.
Or the communication may have been unsuccessful because you are uncomfortable with face-to-face tenant communication.
Tenants will realise when you are out of your comfort zone, and will take advantage of that. That’s all part of the learning process – your negotiation skills will improve with time and practice.
Mastering tenant communication and negotiation skills is worth your time
The cost-benefit is huge if you can resolve tenancy problems quickly, rather than the problem becoming drawn out and a tenancy tribunal hearing being required and a requirement for the debt to be paid off over five years.
It may be a surprise to many property owners but a 14-day notice and a tribunal hearing is generally not going to solve your tenancy problems.
The tribunal hearing is purely like the mechanics and panel beaters workshop that you take your car to: they may repair your car, but they will not give advice on driving safety!
In property management, you need to learn the skills for yourself.
Focus on proactive, preventative measures
Landlords and Property Managers need to implement strategies that are proactive and focus on a preventative approach rather than being focused mainly on reactive enforcement measures, i.e. relying on the Tenancy Tribunal dealing with rent arrears!
Prevention is always better than the cure… and this is never more apparent than in the area of managing rent collection. It will always cost Landlords less to collect rents rather than to chase arrears.
Prevention of rent arrears can be achieved by instilling a payment culture so that the payment of rent and other bills becomes a high priority for tenants.
Remember: your role is to be a Property Manager – nothing more and nothing less
Many tenant problems will be centred on money problems. Maybe they’ve lost their job, or they’ve had some other bad news with a financial impact. Sometimes these financial problems may not be obvious to the novice Property Manager, because the tenant won’t mention them. Often these problems will be disguised as red herrings or smoke screens.
No matter how much you may sympathise with the tenants’ predicament, you need to remember that you are their Property Manager. You are NOT their budgeting advisor, life coach, or social welfare officer.
Don’t let these specialist advisory roles become intermingled with your property management tasks. These advisory roles are the domain of recognised specialists, and are not your concern.
What if there is no win-win solution?
Sometimes the only solution for a problem is for the tenant to move on, for example if they simply cannot afford the tenancy any longer.
A remedy for the problem is not really going to be achieved, no matter how many 14-day notices are issued or tribunal hearings are attended.
Perhaps it is a difficult realisation for the less experienced landlord to accept, but some decisions are necessary so you can successfully move on to appointing a new and successful tenancy.
- When you’re negotiating with tenants, there are just a finite number of things that can occur.
- In time, you will get to know all of a tenant’s objections to any scenario – and be able to head them off.
- It takes time and practice to get accustomed to tenant negotiation.
- Have a clear goal in mind when negotiating with tenants.
- Communicate in a very specific way that’s not open to interpretation.
- Review your performance in negotiations to see what went well and what could have been approached better or differently.
- The cost-benefit to mastering tenant communication and negotiation is huge if you can resolve tenancy problems quickly.
- Focus on proactive, preventative measures by instilling a payment culture.
- Your role is to be a Property Manager – nothing more and nothing less. Do not take on the roles of life coach, budgeting advisor or social welfare officer.
- Sometimes the only solution for a problem is for the tenant to move on. If that happens, focus on appointing a new and successful tenancy, and learn from what happened.
For more property management tips, check out our latest property news →