Turnover is expensive. Getting your property ready to rent, advertising the vacancy, showing the property, and screening tenants are some of the most costly and labor-intensive tasks involved in owning and profiting from rental property. Once you’ve found an ideal tenant, retention of that renter will become an important aspect of your business. Here are some tips on how to do just that:
- Establish a good relationship with a clear agreement: Nothing sets the stage for a trouble-free landlord/tenant relationship like a clear rental agreement. Beyond the monthly rent and utilities, your agreement should spell out who’s responsible for what in the event that repairs are needed. If the property you’re renting includes a yard, be clear about who will maintain it.
- Be professional: You want to deal with a tenant who is reliable, respectful, and responsive—and your tenant wants the same thing from you. Be friendly and flexible and your tenants will likely return the favor.
- Answer the phone: Most tenants prefer to deal with professional property managers for the simple reason that they know it’s someone’s job to quickly help them resolve any issues that may arise. Regardless of what your other obligations are, make it a priority to take your tenants phone calls, or to return their calls within 12-24 hours.
- Take care of repairs in a timely manner: In addition to answering the phone, let your tenant know that they’re important to you by taking care of any needed repairs without delay.
- Make cosmetic improvements on a reasonable schedule: If you’ve been fortunate enough to acquire the Holy Grail that is the long-term tenant, be sure to offer her fresh paint and a professional carpet cleaning every two or three years.
- Deal with disruptive tenants promptly: If you’re managing a multi-family residence, dealing with tenants who are undermining the group’s ability to live together peacefully is crucial to your business. Nothing will drive ideal tenants away from your building more quickly than having to deal with obnoxious neighbors.
- Respect your renter’s privacy: Unless your tenant has a problem, they don’t want to hear from you. Respect that. You’ll occasionally need to gain access to the property for one reason or another, but when you do, be sure to give proper notice, and try not do so more than twice a year.
- Go easy when raising rents: If you rent your property in a weak rental market and find your tenant’s lease ending in a stronger market, it can be tempting to raise rents by the maximum legal amount. However, offering good tenants a rent that is slightly below market rates can be a powerful retention tool, potentially saving you hundreds or even thousands of dollars in turnover costs.
- Offer incentives for tenants to help you fill vacancies: Not only will this aid you in your search for additional tenants, you’ll increase your chances of retaining the ones you already have if you end up placing their friends in the same building.
- Give small tokens of appreciation: If you have renters you particularly appreciate, let them know. A Christmas card with a personal note and small gift certificate is a great example of a thoughtful, unexpected gesture that can go a long way toward encouraging tenant loyalty to you and your business.