How to Choose the Right Tenant for Your Rental Property

Finding the right tenant for your rental property is crucial to ensuring a hassle-free tenancy. A responsible, reliable tenant will not only pay rent on time but also take care of your property—minimizing damage, disputes, and unexpected costs.

If you’re renting your property privately, following a structured screening process will help you secure a tenant who meets your expectations. Here’s how to choose the right tenant and avoid common pitfalls.

Understand Your Obligations Under the Equal Opportunity Act

Before selecting a tenant, it’s essential to comply with anti-discrimination laws. Under the Equal Opportunity Act, landlords must not discriminate against applicants based on:

• Gender, age, race, or religion

• Marital status or pregnancy

• Sexuality or disability

• Mental health conditions

Be sure to check your State’s legislation to ensure compliance and fair selection practices.

Key Documents to Request from Tenants

To properly screen potential tenants, request the following:

• Government-issued photo ID (driver’s license, passport)

• Employment verification (current payslip or bank statement)

• Proof of current address (utility bill, phone bill, rates notice)

• Professional reference (from employer or colleague)

• Character reference (from a non-relative, former housemate, or friend)

These documents will help you verify identity, financial stability, and rental suitability.

Screening Prospective Tenants – What to Look For

Once you’ve gathered applications, narrow down your choices by evaluating the following:

1. Can They Afford the Rent?

A good rule of thumb is:

• The tenant’s monthly rent should not exceed 25–30% of their monthly income.

• They should earn at least 2.5 times the rental amount to comfortably afford payments.

For students or low-income earners, consider requiring a Lease Guarantor—someone (usually a relative) who co-signs the lease and guarantees financial obligations if the tenant defaults.

2. Do They Have a Solid Rental History?

Past rental performance is a strong indicator of future behavior. Check their history by:

• Contacting previous landlords about rent payments and property care.

• Reviewing tenancy checks for blacklisted tenants (see below).

• Asking about the reasons for leaving their previous residence.

3. Have They Been Blacklisted as a Tenant?

Just like credit checks, rental databases track problematic tenants. You can check if a tenant has been blacklisted for unpaid rent, property damage, or eviction through databases like TICA (www.tica.com.au).

4. Do They Have Pets?

Decide whether to allow pets in your rental property. If you do:

• Include a pet clause requiring professional carpet cleaning and fumigation upon lease termination.

• Consider an additional rental bond for pet-related wear and tear.

In Victoria, new tenancy laws allow tenants to keep pets unless the landlord gets VCAT approval to refuse.

5. Why Are They Moving?

A tenant’s moving history can reveal important insights:

• If they frequently switch properties, they may not stay long-term.

• If they’re relocating for work, they may require stability, making them a great long-term tenant.

6. Instincts & Observations

While compliance with rental laws is essential, gut instincts also play a role.

• Tenants who arrive prepared with complete applications show responsibility and organization.

• Positive personal interactions can help differentiate two equally qualified applicants.

If struggling between two candidates, trust your judgment on who seems more reliable.

Renting to Tenants Without Previous Rental History

New renters—such as students or first-time tenants—may lack rental history. This doesn’t mean they won’t be great tenants, but extra verification can help:

• Confirm stable employment and income-to-rent ratio.

• Ask for professional or personal references to assess their reliability.

• Consider requiring a guarantor for added financial security.

Landlord’s Checklist for Choosing the Right Tenant

• ✅ Run a tenant background check using a national database.

• ✅ Verify employment details and income stability.

• ✅ Obtain character references from landlords and employers.

• ✅ Check rental history and previous lease agreements.

• ✅ Assess affordability—can the tenant comfortably pay rent?

• ✅ Decide on pet policies and lease conditions.

• ✅ Have a signed lease agreement with clear obligations.

Final Thoughts

Selecting the right tenant requires due diligence, but the effort pays off in securing a long-term, responsible occupant who respects your property.

By following the structured screening process outlined above, you can minimize risks, prevent future disputes, and create a smooth renting experience.