As discussed in the previous blog, “Should I Stay or Should I Go?” The Reasons Tenants Leave, tenants will choose to vacate their rental home at some point. The question to ask yourself as the property owner and landlord is: Is there anything I can do to prevent a good tenant from leaving? The answer in some cases, is yes. While there are circumstances when a vacancy can not be avoided, there are other instances in which a vacancy can certainly be prevented.
In this second part of the two-part blog, we’ll go over some proactive ways to help improve tenant retention.
- Professional Maintenance – This is first on the list because it is one of the easiest, and possibly most important, items to consider. I used the term “professional” maintenance, because I think that embodies several factors of what makes up good maintenance: responsive, timely, proper, and trustworthy. In a nutshell, landlords should address service requests in a timely manner (based on the nature of the request), have open communication with the tenant, and use a maintenance technician/contractor who knows what they are doing and is professional in demeanor. When faced with a renewal option, you can bet that the way in which maintenance was handled will factor into the tenant’s decision; do you remember that leaky toilet you never fixed? The tenants do. Be proactive with professional maintenance, and don’t let it become a negative factor. Not only does proactive maintenance fulfill the tenant’s needs, but it also helps prevent small maintenance issues from becoming large maintenance issues.
- Screening – Screening is a practice that should be used by every landlord; much can be learned about a tenant by performing proper screening, including their rental history. Knowing a tenant’s past might give insight into how they would be as a tenant in your home. If you’re looking for a long-term tenant, you certainly would not want someone that has had a poor history of paying bills, broken leases, left homes damaged, been evicted, etc. Start off on the right foot, and screen for only qualified tenants. If you set yourself up for success, you will have a better chance of obtaining it.
- Make Necessary Upgrades – Straight forward, but often overlooked. If a stove from the 1970s is giving the tenant fits, replace it. If a ceiling fan sounds like it is one rotation away from flying off the ceiling, get a new one. Not only is this just the right thing to do, but it makes the tenant feel like the landlord cares, both about them, and the home. A happy tenant usually makes for a happy landlord; and a happy tenant will be far less likely to look for a change.
- Incentive Renewals – Landlords know that property taxes can increase, insurance premiums can rise, the price of goods and labor can go up, and the rental market can change, leaving a once market-appropriate rent on the low end of the current market rate. Therefore, an increase at renewal time can be necessary. The problem arises when a landlord has a great tenant who doesn’t feel that they can afford the proposed rent increase, but wants to stay. Keeping in mind the expenses involved in turning a vacant property, it might make sense to come off of the original renewal offer, and come to an amount that makes sense for both the landlord and the tenant. This lower offer should come with the signing of a new twelve month lease. And worst-case scenario, if the cost of turning a property is significantly higher than what a landlord would make by increasing the rent, consider keeping the rent the same for twelve more months.
- Think Outside of the Box – Communication as to why the tenant wants to move is critical. Maybe for the most part everything has gone well, but their water bill was consistently high and they have decided to look for something else. Send a plumber, or your maintenance technician, to inspect all fo the plumbing and fix any issues. Depending on the price point of the rental, and the value of the tenants, maybe you can even throw in a carpet cleaning, or something of that nature to sweeten the deal. As we mentioned in the previous blog post, tenants also move out of necessity due to their life situations: downsizing, upsizing, job relocation, or to be in a certain school system. Depending on the number/location of the units you manage, you may be able to transition them from one of your homes to another. Before sending them on their way, check any other notices you might have received from other properties to find out if they might be a good fit. In that situation, one vacancy is better than two.
- Be a Good Landlord – This doesn’t mean landlords should become doormats, and give in to their tenant’s every demand. In fact, it means quite the opposite. The tenant should be treated with respect, and given their right to quiet enjoyment. However, when it comes to upholding the terms of the lease, a landlord should adhere to those terms in a firm, but fair, manner. Proper communication is key with tenant relations, whether it be through written notices, emails, phone calls, etc. Keep the lines of communication open, and respond accordingly. A tenant is much more willing to conintue renting from a landlord who is responsive, and who treats them fairly.
If you are a landlord who struggles with high turnover, try using some of these tips. Will they work in all cases? No. But they are a great starting point for helping build stronger, and more long-term tenant relations.