The pros and cons of low-income tenants

by Gavin Thomas18 Jul 2019

Whether you’re the landlord of your own properties or a property manager working with a variety of property types, at some point you will likely come across some very pleasant prospective tenants who have little or no employment. You’ve probably been conditioned to step back – or run screaming – when that huge red flag starts waving. It’s nothing to feel especially guilty about: One of your main objectives is to make sure that whichever tenant you choose can actually pay the rent. 

But what if these low-earning individuals otherwise seem like ideal tenants: respectful and friendly? It may be worth getting a bit more in-depth with your qualification process, especially if your other interested parties, even if they’re confidently employed, are making you question why they don’t have a stable home already. Maybe they have other red flags, like that pack of smokes in a pocket you noticed as they insisted they don’t smoke. Don’t get caught with blinders on, where all you can see is an applicant’s claim of high-paying, steady employment.  

Here are some common scenarios you might come across that shouldn’t necessarily disqualify a tenant based solely on suboptimal employment status.  


People with mental and physical challenges can make wonderful, hassle-free tenants. Lots of these people have some sort of consistent and reliable support financially, whether through family or government programs, and often have some form of employment. It’s be important to pay attention to any helpers they may use and verify their state of affairs. There are plenty of opportunities to find a great tenant in this category. If your unit is a good fit for their needs, they will often stay long-term, which is another great reason to consider saying yes in this scenario. 


Yes, students are young and naïve and might ask you questions that make you wonder if they think you’re their new parent. But they might also have bank accounts flush with student loan cash – money that’s literally earmarked to support them through their study years. They might even have some support to pay the bills from the Bank of Mom and Dad. They aren’t usually the longest-term tenants, but they could be financially stable for at least a year and aren’t likely to make any big moves before the school calendar flips over. 

Sign a lease that ends when their school year ends. That way, if they’re a pain in the butt, you’ve got a light at the end of the tunnel. If they turn out to be great, you can talk to them about returning for another year. 


As people age, they tend to want to simplify their lives. This often leads them to selling their larger homes and ridding themselves of the responsibilities of property ownership. Seniors on a pension might have a small income, but it will be steady, and renting to such tenants creates an opportunity where you could wind up with tenants for the remainder of their lives. They might also have a pretty healthy nest egg sitting in their savings accounts. This is potentially even a better scenario than choosing that late-20s couple who are cashing big paychecks. 


Depending on where you live, there could be a population of folks who travel to your area to experience something new. Ski towns, for example, attract a lot of European and Australian travellers anxious to spend a year of their life looking for new adventures. These people often come equipped with a temporary working visa to allow them to generate a small amount of income. More importantly, they also come with a year’s worth of savings that they fully intend to spend on this life adventure they’re on. 

There’s a bit of risk involved in renting to travellers. From experience, I can tell you that some travellers throw a lot of caution – and respect – to the wind when they’re off in a new land sowing their wild oats. They aren’t all bad, though, so proceed with caution on this one. 

Regardless of your system of choosing a tenant, it’s worth taking the blinders off and looking at their overall scenario. Look at each application from a few different angles. Ultimately, you’ll be doing yourself a huge favour by making a thorough, well-thought-out decision on who you’ll be trusting with one of your most valuable investments.  


Gavin Thomas is an active Realtor and investor helping people learn about, acquire and use real estate in Cranbrook, BC, and the surrounding East Kootenay region. For more information, visit



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