With the high cost of tenant turnover, finding a way to preserve existing residents and increase the likelihood of lease renewals is valuable to residential property managers. A 2011 study conducted by SatisFacts Research estimated that each unit's turnover resulted in approximately $3900 in costs over the average 40-day vacancy period. Among these costs are maintenance expenses, concessions and lost rental income. That figure alone demonstrates the high value of maintaining resident retention.
Doug Miller, President of SatisFacts Research, says the first step to preservation is "exceptional service." Because 54 percent of resident turnover is avoidable, Miller explains, "There’s no rocket science behind it. And it doesn’t cost any more to provide great service than mediocre service.” And what defines exceptional service? According to SatisFacts studies, it's promptness of responsiveness; follow-up after maintenance; and courteousness and professionalism. Once these expectations are met, creative strategies can be implemented in addition. But first thing's first, and that's great customer service.
What kind of creative strategies are effective for rental property managers? Lynette Hegeman, VP of Marketing at Gables Residential, explained the various programs Gables has implemented to increase resident satisfaction. Gables offers rewards for tenure with their Gables Great Reward Program, which extends a 'thank you' gift upon lease renewal, including things like carpet cleanings or the painting of accent walls.
Gables also encourages camaraderie among residents with monthly events and activities. Such activities do not have to be expensive; it's a matter of infusing a community with a sense of community. Hegeman says, "Integration doesn’t always mean you have to spend a lot of money. It’s about innovation.”
And there you have it; it seems a blend of seamless customer service and thoughtful innovation are the keys to boosting retention.
