The Tide Test

A landlord's standards are easy to keep when there is a queue of applicants for every flat. The real test comes when the flat has stood empty for a while and the bond still goes off every month.

In a busy rental market, checking an applicant is simple. The landlord asks for payslips and bank statements, runs a credit check with the applicant's consent, phones the previous landlord and takes a deposit before the keys change hands. If anything looks wrong, the next applicant is waiting.

When the market slows, every one of those checks starts to feel like an obstacle. A friendly applicant offers to pay cash and move in this weekend, but the previous landlord cannot be reached and the bank statements never arrive. Each shortcut comes with a reasonable story. And the landlord, looking at an empty unit and a debit order, is very tempted to believe it.

That is the low tide, when it becomes clear which standards were convictions and which were only easy while the money was flowing. A bad tenant costs far more than a vacant month: the lost rent, the legal process if it comes to recovering the property, and the repairs afterwards, all slower and dearer than waiting. Landlords who still do every check in a slow market usually wait a little longer for a tenant, and then keep that tenant for a long time.