Struggling with tenant turnover? Explore these five tips to maximize your tenant retention as a landlord or property manager. Learn about rental incentives, maintenance, how and when to increase rent, communication, and community.
As tenancy trends constantly change and evolve, landlords and property managers spend much of their time trying to keep up with the shifting market. Between cooling rental markets, changing laws, and various other shifts that can make being a landlord or property manager difficult, one important aspect of the job is tenant retention.
One major change in the rental market is in the length of tenant stays. While millennials and older generations tend to stay in one place longer, especially if they have children or pets, Gen Z has been noted to spend shorter periods in one rental.
As a landlord or property manager, maximizing your tenant retention is highly beneficial to your ROI and can make your job significantly easier. But when thinking about tenant retention and how to improve it, you may be left with the question of how. Explore these five suggestions to maximize your tenant retention and encourage your renters to stay as long as possible.
Offer Rental Incentives
Offering incentives for renters is becoming an increasingly common practice among landlords and property managers, with the American Apartment Owners’ Association reporting that 37.3% of housing listings on Zillow have some form of rental incentive or concession. These incentives are designed to encourage tenants to stay longer by offering a variety of benefits for tenants staying in their homes.
Common rental incentives include options such as utility packages that cover the costs of electricity, water, and sewage. Partnerships with local businesses for discounts, lowered deposits, and valuable upgrades are all examples of rental incentives.
If you don’t have any listed already, look at the benefits your rental already offers and advertise those to prospective tenants. Additional possible incentives include free parking, storage spaces, and luxuries. A good location, new flooring or counters, and pet-friendly policies are also examples of rental incentives.
Learn more: A Brief Guide to Rental Incentives
Prioritize Maintenance Tasks
When something at your property breaks, it is important to address the problem quickly and efficiently. Prompt action is an excellent way to both resolve issues quickly and gain favor with your tenants. A landlord or property manager who cares for their property well is one that tenants will want to stay with.
Additionally, when your tenant reaches out about a maintenance issue, ensure that your responses are prompt and helpful. Stressed, frustrated tenants may be difficult to handle, but keeping a cool head and a calm, polite demeanor is the best way to ensure your tenants feel heard and cared for.
Learn more: 5 Small Maintenance Tasks That Landlords Can’t Overlook
Keep Rent Increases Fair and Consistent
Most tenants expect their rent to increase over time gradually, and are understanding when it is raised. However, ensuring that your increases remain fair and consistent over the years allows your tenants to know what to expect. A tenant who knows what their next year will look like with you is more likely to stick around for that year.
Apartments.com recommends increasing your rent by only about 3-5% each year for the fairest rent increases. However, the article notes that you should look into your local and state laws to ensure all increases and changes to your rent are allowed by your local laws.
Communicate Clearly and Kindly With Tenants
Clear communication is a highly valued skill that landlords, property managers, and tenants alike love. Everyone appreciates having someone who can and will talk to them directly and politely about their circumstances. This certainty and comfort in communication and knowledge of their circumstances will encourage a tenant to stay in their rental for longer.
On the opposite side of this is lacking or rude communication. If you neglect to communicate with your tenants or don’t work to ensure a kind, cooperative tone, you may leave your tenant frustrated and confused about the next steps. These tenants are more likely to foster feelings of distrust and dislike towards you and want to move out.
Learn more: The Best Communication Tips for Landlords and Renters
Foster a Community Spirit
Community keeps people in one place. Friends, family members, and other loved ones are excellent draws for remaining in an area. Many people base their moves and lifestyles around being close to the people they care about.
As such, it is beneficial to develop a community within your rentals. Host community events for tenants, give your tenants gifts around the holidays, and otherwise make an effort to create an environment where your tenants feel at home.
Themed holiday events such as Halloween parties, winter holiday parties, and Thanksgiving celebrations can all build community. Communal amenities like playgrounds and daycare can create an environment for parents, if installing them is possible. Pet lovers can benefit from community dog parks or pet care, which I know firsthand can develop a community environment.
Final Thoughts
There are myriad ways you can encourage your tenants to stay in a rental longer, from community building to material benefits. While not every tenant is going to stay for many years, these methods can encourage longer, happier tenancies and prevent you from incurring as many costs related to tenant turnover. Try implementing these tips going forward and see how they affect your tenant turnover.
Do you have a preferred way of maximizing your tenant retention? Let us know in the comments and offer additional tips to your fellow landlords and property managers.