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Top 10 Reasons Tenants Move Out (and How to Keep Them)

Top 10 Reasons Tenants Move Out (and How to Keep Them)

6 min read
Sterling White

Sterling White is a multifamily investor, specializing in value-add apartments in Indianapolis and other Midwestern m...

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If you’re losing a good tenant, you might want to encourage them to stay. But you can’t do that unless you know why they’re moving out. There are a number of reasons tenants leave—and here are the most common explanations and how to keep them.

Related: How Much to Charge for Rent: A Landlord’s Guide

1. Expensive rent and more options in the market

Housing costs, especially rents, have been rising for the last five years. Some markets have reached the point where it makes more sense to move somewhere cheaper. There, your renters can get more bang for their buck. Sometimes, simply moving to a new neighborhood adjusts the relationship between their rent expense and quality of life.

And sometimes, you’ve just overpriced your unit or raised the rent too dramatically.

Pay attention to local trends

Market rents change over time. Regardless if a rental property is at full capacity, staying in tune with local trends is good business practice. If neighboring properties are leasing for 30% less, that could become an issue.

Even if you’re simply keeping up local rents, many tenants hate the idea of paying more rent for the same property. They would rather switch properties and pay more. Psychologically, a new place (and maybe better or different amenities or location) may justify the price increase.

If a rate increase is necessary, tell renters well in advance to give them time to process and prepare for the changes.

Raising rent by more than 10% is a surefire way to lose even the most loyal renters. Raise rent over time—raising rent 2% or 3% percent here and there will have a much less noticeable effect.

2. Problems with neighbors

No one likes scary or abusive neighbors. Bad neighbors can make for a miserable housing experience. Nobody wants loud, intrusive neighbors! If no one’s dealing with tenant complaints about annoying residents, it should be no surprise when they take a hike.

Deal with tenant problems early

Keep lines of communication open and listen to these complaints. If there are problem tenants in neighboring units, renters probably will not renew their leases. If the disruptive neighbors belong to another landlord, preempt issues by contacting the other landlord.

Related: The 4 Types of Horrible Tenants (& How to Deal With Their Shenanigans)

3. Unkept promises

It is important to establish trust and rapport with tenants—they need to feel like they can be upfront and honest. A professional attitude by being reliable, responsive, and respectful will go a long way in terms of goodwill, and tenants will likely return the favor.

Keep lines of communication open

This includes answering the phone or returning calls within 12 to 24 hours. The worst feeling for tenants is feeling like the landlord’s only purpose is making money. Tenants deserve your respect and transparency.

It’s important that your tenants know your phone number (or your property manager’s, if you’re not self-managing). This ensures that they can reach out when needed when something goes wrong.

4. Ignored repair needs

Sometimes tenants simply despise dealing with a landowner or property manager’s lack of attentiveness. Issues happen—but renters want to see an effort to correct them.

For example, if the air conditioning goes out on a Friday afternoon in July, they want the repairman to arrive within the day. Waiting until Monday and forcing them to suffer through the miserable heat will not win any bonus points.

Some apartment dwellers may hesitate to complain about “small” issues. For instance a loud (but not broken) dishwasher or a window in need of weather-stripping.

These issues may not necessarily incite a repair request, but do wear on a tenant’s nerves, and prompts them to start to look for better, nicer places.

Pay attention to problems (big and small!)

When it comes to rentals, taking care of any needed repairs without delay shows tenants that they are important. If it’s an emergency, send a maintenance person to the property ASAP.

And those small issues? Check-in with your tenants frequently. Are they having any minor problems or dealing with annoyances? Not only will fixing them make your tenants happy, but it may uncover big problems that need an immediate remedy. A tenant mentioning a dripping sink could save you thousands of dollars in water damage!

Related: You Can Avoid After-Hours Phone Calls From Tenants—Here’s How

5. Unexpected life changes

A tenant’s personal situation may simply change. Maybe they changed jobs, expanded their family, or are moving away to be close to a significant other. There’s nothing you can do about these highly personal situations, which often sneak up with very little warning.

The best you can do is wish them the best and move on.

6. Fear of the market or potential eviction

Sometimes tenants leave just because they are afraid of the market and how it may shift.

They may worry about how rents might increase. They could be afraid of eviction because they have fallen a few days behind on rent a couple of times. Or it could be that a tough new property manager is causing panic in the renters.

Whatever it is, if there’s fear, you need to address their concerns.

Establish expectations early

Set clear expectations by getting feedback from loyal, long-term renters you trust. This is especially important when you bring in new management. Connect with them about renewing leases early and maintain property upkeep to show tenants you are a caring landlord, not a slumlord.

7. The home is too small

Between a growing number of multigenerational households and millennials’ growing families, many simply need more space today.

A lot of people jumped on the minimalist lifestyle after 2008, but now, years later, they are tired of living so tight and cramped. In fact, a Realtor.com survey shows that this is driving far more Millennials and Boomers to choose single-family homes in the suburbs over homes in dense urban centers or condos.

Offer flexibility

Single-family home investors may not have much leverage here, but multifamily buildings provide some options. If you’re worried about losing a good tenant, consider offering them a larger unit.

8. The home is too large

Sometimes, the space is too big. In recent times, there’s been a push for downsizing and to opt for more environmentally friendly options to reduce your personal carbon footprint.

Other times, it’s just too much house to maintain. It’s understandable, and it’s hard to convince tenants that are leaving otherwise.

9. The tenants are ready for homeownership

With rents more expensive than mortgages in many areas, interest rates low, and credit scores recovering, many are ready to buy a home. Mortgage costs seem like a good deal—and having their own slice of equity feels exciting. This is one of the biggest reasons good tenants leave their current rental situation, and unfortunately, there’s not a lot the landlord can do to prevent them from moving.

Make the best of it—or offer up their home

If it is unavoidable, the landlord can make the best of it. Ensure a good exit service, return security deposits promptly, and ask for a review on the spot.

Another option: See if they’re interested in buying the condo or house instead of moving away.

10. The market shifts in their favor

If the market shifts into a renter’s market, you may find tenants on the move. Renter’s markets mean that there are more units than there is demand, which equates to a lower overall price.

Tenants may find that they can get more bang for their buck when they leave their apartments or homes. Cheaper homes and larger spaces will always be a popular draw for most people.

You can avoid a massive loss in tenancy by reducing your own rental rates or offering incentives via extra amenities or improving the home itself with refurbishments. 

What else can landlords do to avoid these issues?

We’ve discussed how you can address each issue after the fact—but there are things you can do to preempt renters from leaving long before they even have a reason.

1. Make sure the rental is in good condition

Many landlords warn against over improving the property, but that doesn’t mean you can’t make sure tenants have a fantastic living space.

Here’s why:

  • Treatment: Tenants are more likely to treat a property well if the property is in good condition.
  • Turnover: The number of small, minor inconveniences that tenants won’t complain about, but will move out as a result of, will decrease.

2. Send out a survey

Many large apartment complexes and multi-unit properties send out surveys to acquire anonymous feedback from their residents.

Surveys that cover resident satisfaction, maintenance satisfaction, and move-in follow-up surveys provide the landlord and property manager with the feedback that they need in order to have happy residents.

For small-scale, mom-and-pop landlords, consider something like Survey Monkey or even just a Google Form to gather residents’ feedback. It may be hard to guarantee anonymity this way, but it can be an effective tool for acquiring feedback.

Related: Secrets of Successful Landlords: 8 Things Profitable Landlords Do Differently

3. Send periodic emails

Occasionally email your tenants to check in and ask about their unit. This opens up communication and allows residents to ask any questions or bring up problems that need to be addressed.

Sometimes the tenant may not take the initiative to voice a problem or concern. If you begin the conversation, they may feel more comfortable speaking out.

Closing thoughts

There are a number of reasons good tenants leave rentals, even if they like their unit. Smart landlords will get out in front of these issues to minimize negative effects and find ways to keep those tenants in their property to avoid turnover costs.

After all, turnover can be the biggest killer of cash flow. All the processes and costs involved in moving a tenant out of an apartment, fixing it up, and moving another tenant in add up. These include administrative costs, advertising, showing the property, application costs, repair expenses, and, of course, lost income.

While landlords cannot keep 100 percent of their tenants, being aware of the common causes of turnover can help you lower your vacancy rate and improve your cash flow.

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