Topic: Retention Statistics

Does anyone have statistics about retention nationally? Specifically I'm looking to figure out:

- How much more does it cost to find a new renter vs. a renewal?
- How much (advertising, unit turn, concessions, etc.) does it cost to fill a vacant unit?
- How much more profitable is a renewal vs. filling a vacant unit?
- How long does a unit sit vacant on average?

Please post any links to stats or let me know if you have .pdf you'd be willing to share.

Thank you for any help!

Mark, I would have to say this is going to be market specific. There are a lot of areas enjoying higher occupancy that others. There's no question, in most cases, it is better to renew than to find a new tenant.I'll give you some examples:
A. Tenant pays $800 in rent at renewal time. You would expect to rent that unit after turning it (estimate cost to turn without new floor covering $1,000) at $875. You offer $825 renewal rate.

1. If tenant stays for another year, your income will increase $300.

2. If tenant moves, your income will increase $900 less $1,000 to turn it + loss to vacant days and time spent marketing it.

So, in this situation, it is going to be better to renew it, even offer an upgrade or carpet cleaning as an incentive to accept the renewal rate and stay.

This is a simplified example,but you can plug in your own numbers and see. I've taken over properties where the renewal rent was $600 and we were offering the same unit for $950. In this case, I would let them move. They can't pay $350 increase, but you will need to get your rates up to make a profit.

Thank you for your input, Sandy!

On average, how much would you say it costs you to advertise/market a vacant unit?

I use Craigslist, where I post ads myself. It takes less than 10 minutes to post one ad with photos. Zillow,the same.

If you calculate the time spent preparing these ads by dividing the hourly rate for your staff who performs this task and how many ads you expect them to post per day, you will see Craigslist is not free.

Then,document your phone calls and visits for a month. I spend an average of 5-11 minutes on the phone with each phone inquiry. About 10-30 minutes with a visitor. E-mail inquiries takes less then 5 minutes. Add all of this time up then multiply by the hourly rate you pay your staff for a cost.

Do you want to use magazine ads, such as ForRent.com? Get a quote from the one that has the best distribution.

Your website? How much is it costing you to host it each year? Also, does your property management software include marketing? What percentage of the cost do you want to apply to your marketing budget?

Do you use signs and banners? What is the initial cost of these?

Brochure boxes? I use a good quality paper and print them myself. A ream of 500 sheets of this paper costs $14.00,plus the time and ink to print them and the cost of the box.

Check your phone bill. Do they charge an "advertising fee" to be in the yellow pages? Mine does.

Facebook? Pinterest? You Tube? How much time do you allow staff to work on these?

How about a newsletter? I still do a paper newsletter,but I am looking at switching.

Do you use a mini-model? How many? What was the initial cost of supplies?

I'm sure I missed something. Could everyone else help me out here?

I spend around 3-4 hours per day marketing my small property, as written above. So, if I spent 4 hours per day and made $20 per hour, you would be spending about $80 per day or $400 per week on labor for marketing. This really varies so much daily, especially with phone and walk-in traffic. On a good day last week, I had 17 phone calls and 4 visits. This resulted in zero applications (I have very tight criteria). I leased it to someone who 1. never called; 2. never visited; 3. never emailed. He saw my ad on Craigslist, went to our website and applied online.