Resident retention is a very real issue, and recent events have only made it worse. Residents may fail to renew for a variety of reasons. Some of them are obviously beyond your control, such as relocation for a job or to support their families.
However, some resident turnover is caused by factors that you can control, or at least mitigate. Here is all you need to know about resident retention. Plus a guide to five reasons why residents may not decide to renew their lease, and what you might be able to do about each one.
Your costs are going up, so some rent increases are expected and acceptable. However, increasing rent too much, especially if you are already towards the high end of the market, can result in higher turnover. Which can then wipe out the money you might have made.
Rent needs to be set based on the market, your costs, and the perceived value to renters. Amenity-based renting can help. If you can point to the things they are getting for their rent, it can help them to be willing to pay more (although it can, of course, not help with the ability to pay).
In other words, make sure your rent increases are balanced, match the market, and don't give renters massive sticker shock. Having an apartment stand empty for two months is costly, and so is developing a reputation for pricing people out.
In some cases, you may be able to offer the renter a smaller unit which they can afford. It is often worth negotiating on rent rather than spending money on filling the vacancy.
Many people choose to live in a multi-family building in the hope of being part of a lively community. Maintaining a community is particularly challenging during the pandemic. But there are still things that you can do such as hiring food trucks, hosting virtual classes, and sending out a newsletter. Book clubs, in particular, lend themselves to going online.
Community is particularly important for students and young people and also for older adults. But everyone appreciates it and even if you were doing a good job before the pandemic, it's time to revisit. So that you don't lose tenants to buildings that have been offering good social-distanced community-building activities.
Some people are happy to hear from their landlord only when there's a problem. But communication is vital to any business relationship and particularly vital for this one.
Make sure that you keep tenants in the loop on what is happening. Not only in the building but also, if possible, in the neighborhood. Your tenants will appreciate knowing about everything from road closures to new restaurants.
Occasional personal contact can make a huge difference. Particularly right now when you are less likely to bump into a resident in the lobby to say hi. Not everyone wants it, and it's good to record who does and who doesn't. But make sure they know that your door (physical or virtual) is always open and that you care about their concerns. Being responsive to questions your residents have is key to building a personal, lasting relationship.
One of the biggest reasons why renters move out is if they don't feel that their maintenance needs are being kept up with. Make sure that your renters don't feel they have to mark every repair request as urgent just to get it done.
Maintenance requests need to be addressed quickly. You should also make sure all preventive maintenance is done to reduce the number of requests you received. If you are still using paper request forms or having people call the front desk, change to a digital system using a website or an app. This allows requests to be tracked through the system and reduces the number of missed appointments and complaints.
Some complaints are going to be inevitable, so make sure you deal with them in a timely and sensible manner. Never dismiss a tenant's concerns and be ready to apologize if needed. Most tenants will understand if, for example, their request is delayed because of a genuine emergency somewhere else in the building. Stay calm and offer a solution to the problem. Also, make sure you have a proper mechanism for emergency complaints such as plumbing problems or gas leaks.
Make sure that you stay on top of recurring issues, especially pest control. Nothing ruins a building's reputation faster than mentions in reviews of cockroaches, mice, or bed bugs. Provide regular pest control services. And be quick to respond to complaints of pests by bringing in a reputable pest control company.
You can't always control how people in your building act and treat each other. But an issue with a neighbor is a common reason for a tenant to leave. The best way to prevent this from happening is to do you is to do your best to attract quality tenants in the first place. And to have solid noise and annoyance policies in place. Having quiet hours can be particularly helpful. Make sure these policies are in the lease or in some legally enforceable form. So that you can take action against a tenant who is causing problems. In most cases, you can avoid eviction. But if you do need to, it's better to evict one troublemaker than lose three or four good tenants.
Generally, a warning is enough, and if it isn't, a cure or quit notice can be issued. If the problem is with a neighbor in another building, off your property, then you can back your tenant up with a complaint or potentially talk to the other landlord about it. You can also look into changing your landscaping to improve noise screening in general.
If you are experiencing high resident turnover and renewal losses, look to see if any of these issues are at the root of the problem. You should also look at how you are marketing your apartments. Making sure you are attracting the right tenants who will stick around, and make sure you are offering the kind of amenities that are currently in demand.
Improving communication, community and resident engagement is a key part of resident retention. Notifii can help with this by giving you strong channels of communication with your residents. And helping you provide them with the information they need, as well as scheduling resident events and activities.