It’s no secret that keeping your rental occupied means keeping a steady stream of rental income flowing. But having low resident turnover has other benefits for landlords too. Longer-term tenants tend to be stable, pay their rent on time, and minimize the costs and maintenance efforts associated with tenant turnover.
When your rental sits empty between tenants, you have to invest time and money into maintaining the property, marketing the unit to new potential tenants, keeping the utilities turned on for showings, and screening new potential tenants all while sacrificing rental income.
To improve your retention rate, it’s helpful to understand why tenants leave in the first place.
Why Tenants Leave Their Rentals
According to the U.S. Census Bureau’s Geographic Mobility Data, the three primary reasons for moving between 2017 and 2018 were related to Housing, Family, and Employment. More specifically:
- Wanting a new or better home
- Wanting a cheaper home
- Wanting to purchase a home rather than rent one
- Wanting to live in a better neighborhood
- Wanting to establish their own household (e.g. moving out of parents’ house)
- Experiencing a change in marital status (e.g. getting married or divorced)
- Accepted a new job or job transfer elsewhere
- Wanting to be closer to work or have an easier commute
- Looking for new work elsewhere or lost their job
Other common reasons for moving
- Frequent maintenance issues (especially if they are poorly fixed or remain unresolved)
- Problems with neighbors
Although you can’t predict when a tenant will have to move for a new job in a new city or to a bigger rental for a growing family, there are certain things you can do to minimize your tenant turnover. You can encourage resident retention by:
1. Being Responsive
Responding to tenants’ requests in a respectful and timely manner will put you in good standing with your residents. Your tenants are less likely to renew their lease with you if you wait long periods of time to respond to requests, respond with hostility, or worse, don’t respond at all.
2. Handling Maintenance Issues Swiftly
Don’t let maintenance issues fall by the wayside. Also, make sure maintenance issues are fully resolved. Don’t be tempted to go for a quick fix that will provide more trouble in the long run and potentially cause your tenants to start looking for another rental. It’s also best to avoid charging maintenance request fees.
3. Providing Routine Maintenance
One way to prevent maintenance issues in the first place is to perform routine maintenance. Be aware of aging appliances and any other aspects of your rental that need tending to. Whenever you do perform routine maintenance, be sure to provide your tenant with appropriate notice beforehand.
4. Resolving Qualms with Neighbors
If tenants in neighboring units are having issues, step in to help resolve those issues. There are plenty of ways you can help in various scenarios, from requiring quiet hours and enforcing rules stated in lease agreements to mediating discussions between neighbors and coming up with new solutions that satisfy all parties involved.
5. Making Sure Your Rental Is Competitively Priced
Look at rentals similar to yours in the area. See how your property stacks up to the competition. You can do this manually, but when you use Apartments.com Rental Tools, you have access to a Rent Comp Report that gives you all of the information you need to know to determine how competitive your rental is. Keep this in mind when you’re deciding how much to increase rent as well.
6. Maintaining Amenities
Keep up with any amenities that could be seen as selling points for the rental. Make sure the pool is clean, the lawn is mowed, and the laundry facilities are all functional.
7. Allowing Pets
The Humane Society of the United States says that 72 percent of renters have pets, yet renters often have trouble finding rental housing that welcomes their pets. Allowing pets in your rental, with minimal restrictions, affords you a larger pool of qualified applicants to choose from. Qualified applicants become great tenants who don’t want to part with their pet-friendly rental.
8. Embracing Technology
If you haven’t already, join the digital age. Start collecting rent online and taking maintenance requests via text message or your website. Apartments.com Rental Tools can help you out with going fully digital too.
Select Tenants Carefully
One of the most effective ways to reduce tenant turnover is to carefully select your tenants. Don’t skimp on the application process. Applications generated through Apartments.com include a TransUnion credit report and background check. It can also be helpful to ask for references from previous landlords to get a better idea of what kind of tenant an applicant has been in the past.
When screening a potential tenant, ask them pertinent questions that abide by the guidelines set by the Fair Housing Act (FHA). The FHA prohibits any housing-related discrimination on the basis of race, color, national origin, religion, sex, familial status, and disability. Make sure your standards are the same for every potential tenant.
While there are many situations out of your control that cause tenants to move, there are also many that are in your control. Ensuring that you’ve priced your rental competitively for your market, responding efficiently to maintenance requests, and embracing technology and pets are all actions you can take to make your rental a sought-after place to live for qualified tenants.