How to Spot a High-Risk Landlord on Your Rent Roll (Before It Hurts Your Valuation)
Some landlords cost you more than they’re worth, and if you're planning to scale or sell, they could be killing your valuation.
As property managers, we spend a lot of time screening tenants, reviewing arrears, and dealing with maintenance. But here's the truth: it’s often the landlords doing the real damage to your business.
If you’re not filtering for high risk landlords on your rent roll, you’re flying blind into your next valuation. And when it comes time to sell or grow, the wrong clients can drag your numbers down, fast.
They Might Be Legal, But They’re Not Profitable
When you're getting ready for a rent roll valuation, one of the biggest traps is assuming more properties = more value.
It doesn’t work that way.
Rent roll valuations are usually based on a multiplier of your annual management fees. But high-maintenance landlords with poor service habits, low fees, and compliance issues dilute your value. A bloated portfolio filled with headaches is less attractive than a lean, profitable one.
REIQ hits the nail on the head in their write-up on common property management mistakes: "Growing your rent roll with problematic landlords is a recipe for trouble... short-term bad business is going to be detrimental down the track."
5 High-Risk Landlord Profiles (and How They Hurt You)
Here’s who to watch for on your rent roll:
1. The “Low-Fee Legacy”
They signed up in 2015 at 4.5% and haven't budged since.
These landlords often generate the least revenue but require the most support.
Buyer impact: They see this and immediately discount your multiplier.
2. The “Control Freak”
They want to approve every tradie, argue every invoice, and rewrite your inspection notes.
This type creates burnout and staff turnover, both red flags to buyers.
3. The “Compliance Dodger”
They refuse to install smoke alarms, decline entry notices, or delay urgent maintenance.
Your agency carries the legal risk, not them.
If you're effectively choosing a contractor out of a hat... the time you save in the short term could be paid back threefold in the long term.
4. The “Turnover Trigger”
New tenants every 6 to 9 months, typically due to poor property condition, overpricing, or neglect.
Vacancy spikes ruin your data, and your valuation.
5. The “Time Vampire”
They call every second day, send 15-minute voicemails, and expect replies yesterday.
They slow down your operations and often resist fee increases.
How to Audit Your Portfolio for High-Risk Landlords
If I were prepping a rent roll for sale, here’s what I’d check first:
Below-market management fees
Excessive communication logs
Repeat maintenance or compliance disputes
Frequent tenant turnover
Ignored safety or legal obligations
Use tags in your software or create a manual scorecard. If more than 10-15% of your portfolio fits the bill, it’s time for a clean-out.
What to Do with High-Risk Landlords (Without Burning Bridges)
You don’t have to fire every problem client overnight. You’ve got options:
Increase Fees
Reframe it as a compliance and service restructure. Many high-risk landlords will exit themselves when they see the new structure.
Set Boundaries
Use onboarding packs or service-level agreements to define roles and expectations clearly.
Refer Them On
If they won’t adapt, refer them to another agency that suits their expectations. Not every dollar is a good dollar.
Document Everything
If you’re selling, make sure every interaction, issue, and compliance request is logged. That way, you can show buyers you’ve done your part, even if the landlord didn’t.
A Better Rent Roll Means a Better Business
You don’t need more properties. You need the right landlords.
Cleaning up your landlord list now will improve team morale, profitability, and your future valuation. Don’t wait for a buyer to find the red flags for you. Beat them to it.
If you’re unsure where to start, this is something I help clients with every day. Book a free discovery session and I’ll show you how to clean up your portfolio without blowing it all up.
