Finding the right tenant is one of the most important steps when renting out a property. With the right tenant, renting can be predictable and stress-free in the long term. However, a poor decision can later lead to payment issues, disputes, or significant extra costs.
But what does a “good tenant” actually mean?
It does not necessarily mean someone who is single, childless, or older. Instead, the tenant’s circumstances, financial situation, property use, communication, and reliability matter much more.
In this first part of our three-part tenant selection guide, we look at the most common tenant types. We examine what to consider when renting to a family with children, a couple, a single person, a student, or a foreign tenant. We also explain why you should never make a decision based on just one characteristic.
Tenant selection: does it really matter who moves into the property?
In short, yes. However, perhaps not in the way you might initially think.
When renting out a property, a tenant’s circumstances can affect how the property is used. They may also affect the expected rental period and everyday communication. However, the tenant type alone does not show whether someone will be reliable. For example, a family with children can be a particularly stable, long-term tenant. Likewise, a single tenant can cause problems, while a couple or student can be an excellent choice.
Therefore, it is better to rely on predefined criteria rather than personal stereotypes. These criteria should also be applied consistently to every applicant.
A family with children as a tenant: what should you consider?
Many landlords are cautious about renting to families. This is especially common with smaller properties or recently renovated apartments. Common concerns include greater wear and tear, noise, or faster deterioration of the property.
However, these outcomes are not inevitable.
Instead, it is more useful to consider whether the property suits the family’s circumstances. For example, a multi-room apartment may be ideal for a family. Meanwhile, a one-room studio may be less practical for several people in the long term.
What should you consider when renting to a family?
- How many people will move into the property?
- How long do they plan to stay?
- Is the property size suitable for their circumstances?
- Are there any house rules or condominium regulations to clarify?
- Are the rental terms clear?
- Is their income appropriate compared with the rent?
Having children should therefore not be treated as a positive or negative screening factor. The key question is whether the family’s circumstances match the property.
In addition, equal treatment is an important legal consideration when selecting tenants. Hungarian regulations prohibit discrimination based on certain protected characteristics. Therefore, landlord criteria should focus on objective factors related to property use and contract performance.
Tenant selection for couples: one tenant or two?
Couples are common tenants on the Budapest rental market. In this situation, the most important question is not simply how many people will move in. Rather, it is who will actually be part of the tenancy agreement.
Before signing the contract, clarify who will move in and who will be named in the agreement. Payment obligations should also be clearly defined in the apartment rental contract. These details can help prevent disputes later. It may seem straightforward. However, clear contractual terms can prevent many misunderstandings.
If a couple moves into a property together, it is worth clarifying in advance:
- Whether both people will be named in the rental agreement
- Who is entitled to use the property
- How rent and utility costs will be paid
- What happens if one person moves out
- Who will receive the security deposit when it is returned
This is not because couples are necessarily more risky. Instead, clear contractual arrangements become increasingly important as more people use the property.
Single tenant: is it really the easier choice?
With a single tenant, there are generally fewer people using the property. This can be practical, especially in a smaller apartment. However, that does not automatically make the person a better tenant.
Financial stability can still be important. So can employment, the planned rental period, and clear communication. For example, a single tenant can be an excellent choice for a studio apartment. This may be particularly true if they have a stable income, plan to stay long term, and meet the predefined requirements.
Therefore, the match between the property size and the tenant’s circumstances is often more important than the tenant type itself.
Student tenant: what should property owners consider?
Students are an important part of Budapest’s rental market. This is especially true around universities and in well-connected central districts. However, students can have very different financial circumstances. Some have their own income, while others receive financial support from their parents. Therefore, “student” alone does not provide enough information for a decision.
What should you clarify with a student tenant?
Who will pay the rent?
If the parents finance the accommodation, this should be clarified before signing the agreement.
How long are they looking for a property?
One student may only plan to stay for one academic year. Another may remain in Budapest for several years.
How many people will move in?
With shared accommodation, it is particularly important to establish exactly who will use the property.
What rental conditions do they accept?
The security deposit, rent, utilities, move-out conditions, and property-use rules should all be clear.
The goal is therefore not to automatically reject students. Instead, make sure the actual payer, users, and rental conditions are clearly identified.
Foreign tenant: a separate category or simply a different situation?
In Budapest, it is natural for foreign employees, students, diplomats, and other temporary residents to look for rental properties.
With foreign tenants, the biggest challenge is often not the person themselves. Instead, it may involve administration and communication.
For example, it is worth clarifying in advance:
- How long they plan to stay in Hungary
- On what legal basis they are staying in the country
- Where they work or study
- How payments will be made
- Which language they can communicate in comfortably
- What documents they can provide
- Who should be contacted in an emergency
At the same time, a foreign tenant can be a particularly stable choice. For example, this may be the case if they work for a multinational company and their stay in Budapest is planned in advance. The principle is the same here. Do not make decisions based on nationality or origin. Instead, consider objective circumstances that are relevant to the tenancy.
Older tenant: what should you consider?
Older tenants may sometimes have longer-term housing needs. However, this should never be assumed automatically. Instead, consider whether the property is suitable for their circumstances. For example, a fourth-floor apartment without a lift may raise different considerations than a ground-floor or lift-accessible property.
Therefore, objective circumstances matter here as well:
- Accessibility of the property
- Planned rental period
- Payment terms
- How the property will be used
- Communication and contractual conditions
Tenant selection: which type of tenant is best?
There is no universal answer.
For example, the ideal tenant for an investment property in Budapest may be very different from the ideal tenant for a family-friendly, multi-bedroom apartment. A single tenant or couple may be practical for a studio apartment. However, a three-room property may be better suited to a family. A good tenant, therefore, does not mean one specific tenant type.
Instead, a good tenant is someone whose circumstances, financial capacity, and use of the property match its features and the landlord’s requirements.
What should you base your tenant selection on?
Once you look beyond tenant types, you can get a much more useful picture. For landlords, the following factors may be particularly important.
1. Financial capacity
The tenant should be able to meet their obligations regularly. This includes rent and related costs.
2. Long-term plans
The longest possible tenancy is not always the goal. However, it is important to know whether the applicant plans to stay for a few months or several years.
3. Property use
Clarify how many people will move in and whether they will have a pet. Other circumstances affecting the use of the property should also be discussed.
4. Communication
Clear and straightforward communication can already reveal a lot during the viewing. It may also indicate how the future cooperation could work.
5. Previous rental experience
If a reference is available and can be obtained lawfully with appropriate consent, it can provide useful additional information.
In Homever’s practice, tenant screening involves considering several factors together. Financial circumstances, previous rental experience, and the personal conversation can all play a role in the decision.
Property management in Budapest: why does tenant selection matter so much?
Tenant selection is not simply a one-time administrative task. It can affect later communication, payments, maintenance situations, and the amount of time the landlord needs to spend managing the property.
Therefore, conscious tenant screening is an important part of professional property management. Homever also treats tenant sourcing and pre-screening as a separate part of its service. The goal is to find a tenant who fits the property and the landlord’s expectations.
If you also want to understand what to consider when choosing a professional property manager, take a look at our guide covering the 9 strategic considerations when selecting a property manager.
The key takeaway: look for the right tenant, not a tenant type
During tenant selection, it is easy to make generalizations based on one bad previous experience. However, there is no rule saying that every family is problematic, every student is noisy, every foreign tenant is uncertain, or every single tenant is ideal. A much better approach is to define the requirements for your ideal tenant in advance. Then, apply the same criteria consistently to every applicant. This is not only fairer. It is also a safer approach for the property owner.
In the next part, we will therefore focus less on who the tenant is. Instead, we will look at what information is worth checking before renting out the property.
Frequently asked questions about tenant selection
A good tenant reliably meets their contractual obligations. They also use the property appropriately and communicate fairly with the landlord. A specific lifestyle or family status does not make someone a good tenant.
Not necessarily. Family status alone does not show how reliable someone is. Financial capacity, personal circumstances, property use, and compliance with the rental agreement are much more important.
Yes, if the property is suitable for the family and the tenants meet the landlord’s objective requirements. Having children alone is not an appropriate basis for assessing a tenant.
Yes. With a student, it is worth clarifying the rental period, the number of occupants, and who will finance the accommodation.
Clarify who the tenants will be and who may use the property. You should also establish how payments will be made. It is also useful to agree what happens if one partner later moves out.
Not necessarily. With a foreign tenant, focus on the planned stay, employment or studies, financial background, and communication options.
Yes. It is important to know how many people will use the property in relation to its size and features. This should be clarified before the rental agreement is signed.
Ask about the planned moving date and rental period. You can also ask how many people will move in and about their employment or studies. Relevant circumstances concerning the use of the property should also be discussed.
A landlord may request information that is relevant to the tenancy. However, data protection rules must also be considered when handling personal information. Therefore, avoid requesting unnecessary data that is unrelated to the rental.
Professional tenant screening does not mean selecting an applicant based on one factor. Instead, several relevant factors should be considered together. These may include financial capacity, rental history, and communication.
The right tenant can affect payment discipline, property condition, communication, and how problems are handled later. Therefore, conscious tenant screening is an important part of professional property management.
Start by defining objective selection criteria. Then, compare every applicant based on the same criteria. If you do not have the time or experience to manage the entire process, you can also entrust tenant screening and rental management to a professional property manager.
