What kind of incentives do you have to retain Tenants?

Question

As everyone knows it costs a lot to turn a unit between residents. Therefore it is recommended you do everything possible to retain the better tenants. Do you have some specific items in place to retain these tenants? What would it take to get them to renew their leases?

Mark Purtell · Answer

For my tenants who pay on time with minimal hassle, I explain to the tenant that I normally raise the rent every year 3-5%.  However, since they have been exceptional tenants, I will leave the rent at its current rate.  This seems to work because it helps both you and tenant out

If the lease is coming due at a poor time of the year to find a tenant (i.e winter), I will encourage the tenant to sign a lease that ends in a summer month.  The tenant benefits by being put in the middle of the 'moving' season.

Dale Osborn · Answer

Looks like this thread has petered out or else the posters have petered out so will post a few we have gathered over the years:

Resident Retention or Customer Relationship Management (CRM):  It costs 5X as much to re-rent a unit than it does to renew a resident. It is a lot cheaper to keep a happy resident!

Curb Appeal: Residents want to feel proud of where they live. 
Handle complaints in a timely manner: Quality Assurance & Service. 
Interior & Exterior Preventative Maintenance & Repairs. 
Properly Trained Staff: Screen, Interview, Background Check. 
 -Good interpersonal skills & able to interact with residents. 
 -Provide good customer service: Residents take priority. 
 -Use Job Descriptions to provide guidance. 
 -Encourage everyone to learn and implement new skills. 
 -Emphasize customer service at all staff meetings.
 -Set up a work order system to deal with complaints rapidly. 
 -Follow up with a note or phone call so resident knows action taken. 
 -Effective efficiency = higher effectiveness, workforce stability & increased productivity. 
Have effective communication: 
 -Memos/Newsletters, Bulletin Boards, Website posts. 
 -Provide a key personnel contact list. 
 -Solicit surveys and ask for resident suggestions. 
 -Effective communication saves time and waste. 
Maintenance free living. 
Residents as customers: 
 -Remote site - stress peace and quiet. 
 -Word of Mouth advertising can reduce marketing & leasing costs. 
 -Be nice to Residents as they pay your mortgage and other bills. 
 -Keep community clean. Pick up trash & ask residents to clean up. 
 -Send thank-you notes to good Residents who maintain their units. 
 -Offer a variety of activities for residents. 
 -Have a good newsletter or bulletin board. 
 -Establish a written resident retention program. 
 -Renewal incentives: carpet cleaning, repainting, new blinds, etc. 
 -Hand deliver a birthday card to residents on their birthday. 
 -Offer free light bulb changes for hard to reach light fixtures. 
 -Offer courtesy trash pick-up or rent check pick up for seniors. 
 -Create a lending library of books, DVDs, CDs or magazines. 
 -Have small tools on hand for residents to borrow. 
 -Offer Resident referral. Quarterly changes keep residents interested. Not only cash/rent. 
 -Waive late fees one time per year. 
 -Check on other ways for rent payment like direct deposit monthly. 
 -Offer week-to-week rental leases. 
 -Create a picture ID for all staff for easy recognition by residents. 
 -Use shoe covers when doing maintenance in Residents units. 
 -Call resident to verify maintenance requests completed & satisfied. 
 -Services: Water plants, feed fish, package receipt & mail pick-up for residents on vacation. 
 -Coordinate with a dry cleaning service to drop-off & pick-up for residents. 
 -Work with other businesses for deals or discounts for residents. 
 -Keep change on hand for laundry. Stamps for letters sold at cost. 
 -Have coffee and newspaper available when office opens. 
 -Stay open late one night a week for the convenience of Residents. 
 -Manager work one Saturday each month for Residents convenience. 
 -Have maintenance man on hand when discussing renewal in case repairs needed. 
 -Send anniversary cards to Residents with you for six months. 
 -Make sure move-in day goes smoothly. Help move heavy furniture. 
 -Move-in: Provide paper towels, toilet paper, shower curtain, liquid soap & fresh ice. 
 -Reserve freight elevator & parking spot for moving van for move-ins. 
 -Double-check to ensure all unit, mail, storage, or other keys work. 
 -Change smoke and carbon monoxide detector batteries at move-in. 
 -Introduce new Residents to other Residents. 
 -Keep office and maintenance areas clean and organized at all times. 
 -Sticker on microwave popcorn "We just popped in". 
 -Welcome cards left on counter top signed by all staff. 
 -Referral cards left by maintenance tech asking them to refer friends to the community. 
 -Set up a loaner closet: Tables/chairs, vacuum, iron board, iron, hide-a-bed, crib, car seats, etc. 
 -Move-in appointments: Show how to use/control appliances, HVAC, disposal reset, etc. 
 -If do not want to explain appliance use - post sticky notes by each. 
 -Maintain a record of all service calls by unit. 
 -Reserved parking spots for long-term residents (5 or 10 years). 
 -Internet: emails, e-surveys, e-renewals, e-newsletters, e-updates, e-cards/e-letters & website. 
 -Welcome gifts: Welcome mats, memo pads, snacks/sodas, & first day necessities. 
 -Gift certificates to local stores like Wal-Mart or Home Depot. 
 -Provide info seminars on tax preparation, social security or identity theft protection. 
 -Provide residents with calendars, pens, key chains, etc. each year.

Scott W. · Answer

1 thing i've never understood LL's do is rent it out & then never touch the place until vacant. As soon as vacant, they go hog wild! Why not paint a room each year? Do the little stuff & you might keep them an extra year.

I knew turnover was high but when I read the quote listed above of 5x as high, well, it really sunk in.

Excellent post by Dale Osborn!

Chris Clothier · Answer

There is not a more spot on comment in these forums!

If you treat them fairly and give them reasons to stay, in some cases, you can keep tenants in place and paying on time for years.  And not only will they pay on time, but they also will experience fewer issues that they feel they need to call the management company or landlord about.  It is really very, very simple.  The better you make their entire experience, the higher the likelihood they stay.

Julie Greene · Answer

I know this thread is old, but I am browsing Bigger Pockets to learn as much as I can and this is a great article @Dale Osborn . There are some very unique and creative ideas (Rob K. , the quote about it costing 5x more to find a new tenant really hit home for me too.  I am making notes of all of these so that hopefully when we ramp up with more properties, I can keep many tenants long term with this bag of tricks!!

Except I think I would also pass on doing their taxes - that one is not for me either!

Thanks again for another great read.

Kyle J. · Answer

I don't have a Facebook account, but if I did I would not want to be online friends with my tenants.  I like to keep my personal life private.

Ed O. · Answer

A "guru" I learned from puts an interesting spin on renewals by calling them "anniversaries." I like this. We don't have renewal dates, we have anniversary dates. It's a simple little spin that goes a long way. Also, when tenants request upgrades, we try really hard in a lot of cases to put them off until shortly before renewal time and call them anniversary gifts. Works extremely well. They get something that makes their home nicer, I get another year. It can be something as simple as a new light fixture or even a new appliance. Cut it up by 12 months and match it against a turnover. 
Personally, the more inferior the unit, the more we're willing to do. Additionally, extending a lease can be accomplished when allowing a tenant request, like a small pet or additional roomate, etc.

The most common requests I have been recieving has been for new floors. I have been replacing carpet with allure floors where possible and it's been a win-win. Tenants are typically pretty rough on floors and the cost of doing a half house one year and the other half the next is nothing compared to a turnover, so we're usually ok with doing it. By splitting the floor job in half, you've pretty much extended the lease by 2 years.

Steve Maginnis · Answer

+1 on the incentives.  It also goes a long way to set up reminders on your phone or other calender to remember the family's birthdays.  Just a quick call or note helps a lot.  You could friend them on facebook to keep in touch this way as well if you feel comfortable with that.  Anything you can do to to help them think of you as family.  Naturally, you have to keep boundaries and make it clear that this is business.  I had small apartment complexes where on nice days I brought a cheap charcoal grill out and cooked hotdogs.  Very inexpensive, but everyone loved it.  I guess you can choose to exclude the bad tenants. LOL..

Bridget D. · Answer

A gentleman I knows gives his tenants that have children a giftcard to either Walmart, Target, Toys R Us for $300.00 during the holidays and for single or older persons with either grown or no children he writes them a check for the $300.00. I've known him for 4 years and he has 3 properties all with the same tenants as when I met him. I've yet to acquire my 1st rental but hope to implement this very soon.

Dale Osborn · Answer

I enjoyed math in school, but can't say I enjoy doing taxes each year. To each their own and if that is what you enjoy - try it for one year and see how it goes.

What kind of incentives do you have to retain Tenants?

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