Why Good Maintenance is the Best Way to Retain Tenants
Property management is an absolutely critical component of any successful buy and hold strategy. And while there's a lot to be said about good leasing, firm rules with tenants, quick turnovers, quality accounting and following the law, I believe the cornerstone of good management is good maintenance.
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Once a prospect becomes a tenant, their relationship with management and therefore the landlord (in this case, you) is not the most pleasant one. Basically, they pay you money each month to stay in the unit you rented them. But it's like when someone buys a new toy or piece of furniture or whatever. It's exciting and new for a while, but then it becomes just another part of that person's new normal. It's almost no more than background scenery. Very soon, this tenant just feels like you are some giant succubus that inhales their money each month.
And if they fall behind on their rent or cause problems with other tenants, then the relationship can become even more sour.
During the tenant’s stay, their only contact with management is usually in some negative situation, which is likely why so many tenants have such a bad view of property managers. Either they’re paying the landlord rent, causing some problem that needs to be resolved, or something broke and needs to be fixed.
And as anyone who’s ever owned a property knows, some tenants can get a bit testy when it comes to maintenance issues.
This is why maintenance is such an important thing to get right. It is the only chance you really have to impress a tenant after they've been impressed enough by your property to move in in the first place. And since many tenants pay by check or mail, it's really the only face-to-face contact many ever have with management after the lease signing. That is at least until the renewal signing if they re-sign — and often whether they do that will be dependent on the quality of your maintenance.
Third Party Property Managers
If you are using a third party property manager, one of the major areas of concern you should have is their maintenance. When vetting property managers, you should ask a lot of questions about this, such as:
- What is your maintenance process?
- How do you handle emergency calls?
- How long does it take to close out a work order on average?
- How do you deal with complaints?
- Do you give the tenant’s maintenance surveys after finished work orders?
- How many maintenance technicians do you have on staff? Or do you use 1099 contractors, and if so, how many of them are in your rotation?
If they have a lead maintenance guy, it wouldn’t be a bad idea to ask to speak to him as well.
Once you have a manager, it’s not easy to keep an eye on the maintenance, but you should do your best all the same. Make sure to regularly ask your property manager about it, and if they do leave maintenance surveys (as you should want them to), ask to see any that are turned in from time to time. Finally, if you’re not getting many lease renewals, it may be because the tenants are fed up with things not being fixed in a timely or quality manner, which is worth investigating further.
It’s certainly easier to keep track of maintenance when you are managing yourself, but it’s more difficult to set up.
If you don’t have many properties and don’t have the time or skills necessary to do the maintenance yourself, you will want to look for a skilled handyman who can do work for you. There aren’t a lot who will just do maintenance, but if you have other projects like rehab and turnover for them, many will do maintenance jobs too. Once you grow larger, you can hire an employee to do this, which offers more reliability, as you aren’t sharing that person with other landlords.
A good place to look for such people is on Thumbtack.com. This site allows you to post what type of vendor you want, and such vendors then message you. That way you can more easily find people who are willing to do maintenance orders. And of course Craigslist, Angie’s List and the like are good places to look as well.
You’ll also want to find more than just one. Sometimes people are busy and you don’t want to wait too long to get a job done. Furthermore, you’ll need to build relationships with a few more specialized vendors, particularly a plumber, electrician, roofer and appliance repair technician.
And then there is the dreaded late-night emergency call. First and foremost, you need a little backbone here. Many tenants believe virtually any maintenance issue is an emergency that needs to be taken care of right away. Oven stopped working at midnight? Call the emergency maintenance line. Light bulb went out in the garage? Call the emergency maintenance line, etc.
These things can wait until the next day and you will need to politely tell the tenant that. Most real emergencies involve either water or an HVAC issue. You will want to find a handyman who can take emergency calls from time to time, but you also need a plumber and probably an HVAC technician who can do the same. With plumbing, Snake and Rooter is always good for a late night call, but they are expensive. So it would be wise to try and find a cheaper alternative.
With HVAC, if it’s cool and the furnace goes out, it can wait until the morning. But if it’s freezing cold and the furnace goes out, you will want to get someone out there ASAP.
Good Maintenance is Good Customer Service
Either way you manage, it’s critical to note that good maintenance is good customer service. Maintenance is the face of your company, and good maintenance is the best form of tenant retention there is. Many tenants are used to poor quality service, so if they come to your place and get good service, it substantially increases the chance that they will want to continue renting from you.
For one, I would have the maintenance technician leave behind a review card or survey stating that the work order is closed out and ask them to rate the work. This can 1) avoid confusion, as sometimes the maintenance tech thinks the job is done but the tenant doesn’t and 2) alert you to any possible problems, such as a rude maintenance tech. (Again, this would be a good thing to request of a property management company if you use third party management.)
It is also a good idea to provide company shirts to any on staff maintenance technicians, as it comes off more professional. I would also document everything. We make a note for every call we get in our property management software. We even go so far as to take a picture of the problem beforehand and afterward and store all these pictures under the work order. That way we can reference everything if there are any future issues, miscommunications and/or disagreements (which there will be). Memories are fickle; the more that’s documented, the better.
And follow up, follow up, follow up. Oftentimes, a tenant just wants to know you haven’t forgotten about them. If you can’t get out to a property for a little while, call the tenant and explain the situation. It may feel awkward, but most will appreciate it, and even the ones who are still upset will be less so because you called. We even ask every tenant to note their favorite restaurant when they fill out a lease. That way, if any maintenance issue goes sideways, we send them a gift certificate to that restaurant. It comes off a lot more personal than just a rent discount and can build a lot of goodwill, even when a maintenance issue wasn’t handled particularly well. These kind of things tell the tenant that you care about the quality of customer service you provide and will make them all the more likely to renew.
Remember, in the business of property management, maintenance is your customer service. If you want tenants to be happy and renew year in and year out, you better make maintenance a priority.
Landlords: How do you handle maintenance calls from tenants? Any tips you’d add?
Let me know with a comment!