As a property manager, you always love the best tenants. You know the ones - they pay on time every month, let you know when there is a problem, and keep their unit or home tidy.
These are the folks you don't want to leave when their lease is up, but more than half of apartments turn over to new tenants every year. When a unit or property is turned over to a new renter, you have lost rent, repairs, advertising expenses, and more eating into your bottom line.
You can make your best tenants more likely to stay if you remember the following principles.
Fix Problems Immediately
The best property managers know that keeping the renters happy makes their jobs easier. In addition, it's more likely your tenants will extend their leases if you deal with any maintenance problems quickly.
Few things upset tenants more than having serious maintenance problems go unfixed. If they have to bug you for a month to fix the air conditioner in the middle of the summer heat, they'll probably remember this at the end of the lease.
Keeping up with repairs has other benefits, too. For example, you won't have to spend as much to get it repaired and cleaned up when the unit does turn over.
Also, inspect the unit every quarter to see if there are maintenance issues the tenant didn't mention.
Push Longer Leases
Some property managers only do one-year leases. But it can be wise to offer the most reliable tenants a two-year lease with a 5% reduction in rent.
Yes, you lose on profits from rent increases. But having a good tenant in the unit paying on time for two years means less turnover, fewer vacancies, and fewer advertising expenses.
Focus On Lease Renewals
It is vital to tell your renter several months in advance that you want them to renew their lease. Here's how to get more tenants to renew their leases:
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Reach out to each tenant at least three months before the lease runs out. Ask them if they want to renew.
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Giving them an early notice will get them thinking about their future living plans, so you get the early word if they decide to move out.
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If the renter moves, you can get started on marketing the unit or property before they move. This means less time with a vacancy, which is helpful for the bottom line.
There are other ways to encourage your tenants to renew. Think about skipping the rent increase if they sign on for another year. If they seem unsure, ask what you need to do to get them to renew.
The more you communicate with your best tenants, the more likely they will tell you what you need to do to get them to stay. For example, many tenants want a break on the monthly rent or have upgrades to the unit.
You can find out what matters to them most and hopefully get them to sign on for another year.
Know What Tenants Want
Many tenants, especially the younger crowd, consider the lifestyle a massive factor in whether they stay for another year. You or the real estate investor may own the property, but it's the renter's home for now.
You can give the space a unique atmosphere that appeals to the tenant's desires, enticing them to stay longer.
For example, if the building is near a university, renters may value study rooms and well-lit bike racks. Young professionals may appreciate hardwood floors, steel appliances, and quiet central air.
Keeping your most reliable tenants happy and renting for another year helps you make more money with less stress. So, try these tips and watch your renewals increase!
