February 18, 2016
A Sweeter Deal: Improving the Odds of Tenant Renewals
With so many rental options available, tenants have more choice than ever. To thrive in such a competitive marketplace, property management firms must continually look for ways to keep renters happy.
In other words, they have to create a culture of lease renewals.
By locking in renewals, you’ll benefit from lower turnover and increased occupancy rates. Reduced turnover also means a more predictable rental cycle, so you’ll be in a much better position to coordinate the high and low rental seasons.
All of that adds up to one crucial outcome: An improved bottom line.
So how can you improve the odds of tenant renewals?
Don’t wait 30 or even 60 days before their renewal is up to broach the subject of whether your residents plan to renew. Ask early, anywhere from 90 to 120 days before their lease is up.
Maintain a High Touch
Always deliver on customer-experience focused management, beginning from Day 1. Call before and after move-in and keep in touch on a consistent basis after that. You can maintain ties through a community portal, to avoid being intrusive. But be sure to follow up on issues and find ways of adding a personal touch. For example, send birthday greetings or holiday wishes.
Sweeten the deal with added incentives for longer-term residents—and be sure to let people know in advance the benefits of staying on as your tenant. Remember, the perks don’t have to entail discounted rent or a free month of parking. Consider incentives that would also add value to the portfolio. New cabinets or fixtures make current renters happy and increase your property’s overall worth. You could also offer perks to soften the blow when it’s time to raise the rent. A service like one-time carpet cleaning can perform well; so can gift cards.
Create a Community
Activities like planting a children’s garden, movie night, games night and property garage sales can help foster a sense of community. This goes a long way toward building loyalty, a sense of connection and a better resident experience.
Invest for the Future
Don’t wait until you need to offer an incentive before looking into which areas of your property could use an upgrade. Better amenities go a long way toward improving asset value and tenant appeal. From lighting to kitchen or bathroom remodelling, there are plenty of opportunities for improvement.
Release the Security Deposit
This approach works well with longer-term renters who are responsible and have consistently paid their rent on time. Tell them you’ll begin returning their initial security deposit in installments. Knowing that their money will start coming back early is a great incentive to stay.
Plan For Highs and Lows
While it won’t sweeten the pot, staggering leases as well as identifying when the bulk of your leases are up for renewal will help make managing renewals more efficient. Increase staffing during peak renewal periods to ensure that all tenants up for renewal are contacted. Don’t forget to ask your best tenants for referrals, and reward them for qualified new customers. You’ll also save money by avoiding overstaffing during low-traffic seasons.
Don’t Get Complacent
When it comes to rental properties, residents are in a position of power. They aren’t required to stay once their lease is up. But if life on your property works for them, they’ll have every reason to make your rental unit their home.
To learn more about how you can increase renewals and streamline your management processes, sign up for your free account today or give us a call.