One of the biggest keys to success in real estate investing is retaining residents. The more effective you are at renewing leases at your rental property, the more money you are going to make — and the more money you are going to save — over the long term.
That’s because resident turnover can be quite expensive. To wit, Zego — a proptech company — issued a report in 2022 that found it costs on average $3,976 to replace a resident when they leave a rental property.
When you reduce resident turnover, you reduce your overall costs for physical things such as paint, flooring and other materials, as well as for marketing and advertising to find new residents. Plus, every day that your rental property is vacant is another dollar of revenue you’re not bringing in.
That’s why figuring out how to improve resident retention is so vital in real estate investing, and why working with an experienced Austin property management company can help.
Below are four ways you can improve resident retention at your rental property.
1. Properly Maintain Your Property
The #1 reason why residents leave a rental property is that it’s not maintained properly. People want to live in a place that is safe, beautiful and makes them feel comfortable. If the lawn isn’t cut, if appliances aren’t working and if the rental property is in general disrepair, they’re going to look elsewhere come renewal time.
It’s important for you to invest in property maintenance, both on the small scale and the large scale. This means everyday maintenance such as increasing curb appeal as well as replacing major appliances when they break or outlive their typical life expectancy.
When residents see you’re caring for your property, they’re more likely to feel valued and want to stay.
2. Don’t Overprice Your Property
The more money you bring in for rent, the higher your real estate investing profit will be. But, it’s not a good idea to overprice your property just to chase massive profits.
Indeed, if you overprice your property, residents will look elsewhere to see if they can get a better deal. Even if they are happy with your rental property overall, many residents will look around if they feel as though you’re taking advantage of them.
All rental property owners will need to increase rent from time to time. It’s important, though, that when you do so, you communicate it well in advance to your current residents and that you’re pricing your property in line with similar properties in your area.
3. Treat Residents with Respect
Another effective way to improve resident retention at your rental property is to always treat your residents with respect — even when you have to enforce rules. Treat the relationship between you and your residents as a business deal.
In any business deal, you want to give respect to the other side — otherwise, you may not make a sale or retain a current customer. The same goes for real estate investing.
If you aren’t showing your residents the respect they deserve as humans, they are not going to be happy. And unhappy residents are the ones who often leave.
There may be times when you have to enforce certain rules according to the terms of the lease. Even in these situations, it’s important to be respectful and approach your residents in a kind way. This will go a long way in establishing mutual respect, which can lead to better resident retention.
4. Connect with Your Residents
While it’s a good idea to treat the relationship between you and your residents like a business deal, it’s also important to connect with them on a more personal level. When you do this, residents feel as though you’re hearing them, you value them and you take an interest in them — beyond just collecting a monthly rent payment.
In this vein, don’t miss an opportunity to celebrate milestones for your residents. This could be big life events such as marriage or new additions to the family, or it can be smaller “wins” such as a new job or promotion. Something as simple as sending a congratulations card will mean a lot to your residents.
Likewise, always apologize any time you make a mistake. When you apologize for even small “mistakes” such as not returning your residents’ calls for a day or so, you’re showing your residents you care. That, then, makes them appreciate the great relationship they have with you.
Work with a Trusted Austin Property Management Company
These are just four ways you can improve resident retention at your rental property. Another way is to make sure that you’re working with a trusted Austin property management team that can not only handle these items, but ensure your rental property is always up to snuff.
The team at 1836 Property Management has years of experience helping people be successful in real estate investing. Following tried-and-true methods and approaches to property management, the company ensures that all their clients work to improve resident retention.
Contact us today to learn more and to start profiting in real estate investing.
By: Kayla Gonzales, 1836PM Marketing Manager