Retaining Residents: It’s All About Giving Them Choices
Functional amenity spaces, appealing resident events and prompt maintenance responses all qualify as factors that can enhance the chances of retaining a resident. A resident who has an unresolved maintenance request, for example, is four times less likely to renew their lease.
While a smooth-running property is part of the equation, the most important component to driving renewals is to think of retention more holistically and provide residents with true optionality at the point of renewal. Retention can and should be about more than just keeping a resident in their current home.
Give them options
Property managers often don’t recognize that a lot can change for a resident during a 12-month lease term.
Some residents might be working from home and need more space. Others might have sent their kid to college and have a desire to downsize. For others, they might be forced to relocate due to a new job opportunity. The potential for lifestyle disruptions within a standard 12-month lease period is significant.
Despite this, many properties are often shortsighted when it comes to renewals — will the resident in unit 3A move out or not? Resident needs shift, and if an operator genuinely wants to retain and extend the resident lifecycle, the key is to think more broadly and provide renters with relevant pathways to keep them at the same community or move them to another property within the portfolio.
And the key to giving residents the right options at renewal is to make sure your teams are communicating with them throughout their entire lease. Property managers regularly dedicate an abundance of energy toward attracting new residents, yet too often they seldom check in with residents throughout their lease term to determine if any newfound needs have arisen. With visibility into those needs, properties can potentially keep a would-be departing resident in their ecosystem.
Depending on what an operator has learned, it might make sense to offer a different home within the building – maybe the resident needs more space, desires to downsize or simply wants a home in a different location on the property. For residents who need to relocate due to a job or other lifestyle changes, operators can offer to move the resident to a sister property that not only suits their immediate needs, but takes into account the elements the resident loved about their previous home. This presents a chance to establish brand loyalty that is probable to retain the resident in the long term.
Leasing is a many-to-one proposition, in which the lone outcome is a resident living in your building. Renewals, by contrast, are a one-to-many proposition, as residents have the option to stay, relocate to a different home within the property, move to another property within the same brand or move out of the portfolio altogether.
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A need for change
Without visibility into the changing needs of residents and a framework that thinks of renewals more broadly, operators greatly decrease their chance to retain renters and most likely will continue to operate at the industry baseline of 45% turn rates per year.
Fortunately, technology can assist in helping properties create a much more streamlined and centralized renewal process that collects resident feedback and provides optionality to take into account all of the factors involved in the resident’s decision-making process.
By understanding and recognizing the unique lifestyle changes of a resident, properties can supply the pathways to meet their needs at the renewal stage. Keeping them in their current home, after all, isn’t the only option for retaining them as your customer.
Source: Multifamily Insiders