Drive Your Profits by Reducing Property Management Turnover

Many property managers get so caught up in the hustle of filling vacancies that they forget the goldmine sitting in front of them: happy, long-term tenants.

See, every time a tenant moves out, you create extra work for your team. Marketing, cleaning, repairs, property showings…the costs add up fast, even if you can pass some of those expenses along to your clients. Not to mention, rental turnovers gobble up your team’s time, causing bottlenecks that create additional stress and noise in your business.

By focusing on tenant retention, you can dramatically reduce your property management turnover rates and drive profits in the process.

If you know it’s time to reduce property management turnover and focus on holding on to great tenants, use these simple but effective methods to start keeping your tenants.

Prioritize Delivering Impressive Customer Service

Delivering great customer service goes a long way towards driving tenant satisfaction and will help you reduce property management turnover. It’s important to continually work towards building strong relationships and creating a positive living experience for your tenants. Communication is perhaps the single most important part of this equation.

Keep tenants informed about important updates and scheduled maintenance. Address their concerns and continually show them that their needs are a top priority. Respond to emails and phone calls promptly, and strive to always go the extra mile.

Ultimately, showing genuine care and professionalism in all interactions with tenants will do wonders in helping you retain them as tenants after their leases expire. If you want to go even further, work on personalizing your approach by remembering names and specific preferences, making tenants feel valued and respected.

Dial in Your Maintenance Approach

Maintenance problems and repairs come part and parcel with property management; all rental homes need ongoing maintenance support. By prioritizing proactive maintenance, efficient response times, professional staff, clear communication, preventive upgrades, and a robust feedback loop, property managers can significantly enhance the maintenance experience for tenants, leading to higher satisfaction and retention rates.

Of course, that’s often easier said than done. If your team is struggling to dial in your maintenance approach, it may be worth consider a tool like Vendoroo, which harnesses the power of AI to dramatically reduce response times and eliminate the human errors that cause maintenance issues to drag on indefinitely. Many DoorGrow clients have seen their satisfaction rates skyrocket by adopting Vendoroo! Sign up now and get a discount with no onboarding fee, an exclusive for DoorGrow readers.

Resolve Disputes Immediately

Resolving tenant conflicts and disputes is vital for reducing property management turnover. Conflicts, whether between tenants or involving management, can escalate quickly, creating a negative living environment. When issues are addressed swiftly, it prevents minor disputes from becoming major problems that could lead tenants to move out.

Not only do these situations often take a turn for the worse and lead to the tenant vacating the home, but they could also be a nightmare for your online reputation. When disgruntled tenants take their complaints public, it can deter potential tenants from considering your vacancies and encourage investors to look to your competitors for their property management needs.

By prioritizing quick, amicable resolutions, you can kill two birds with one stone, protecting your online reputation and helping you to maintain a positive working relationship with the tenants.

Handle Rent Increases Tactfully

Consumers are more sensitive to price increases than ever before, with rent rates having skyrocketed in recent years and inflation limiting buying power. Of course, that doesn’t mean you’re simply locked in with no choice but to keep rents stagnant. In many cases, your investor clients are expecting you to perform annual rental increases. Furthermore, those increases may impact your own bottom line, specifically if you charge a percentage of monthly rent as a management fee.

So, how can you increase rent for your tenants without setting tempers aflame?

There are a few simple steps you can follow to keep fallout to a minimum:

1. Increase Prices in Line with the Market
   Don’t arbitrarily increase rents, but use the current market as a guide for determining an appropriate increase. Typically, annual increases hover around 3-5%. By respecting this amount, you’ll be demonstrating good faith to your tenants and helping to soften the blow.
2. Provide Ample Notice
   There’s nothing worse than getting hit with unexpected extra costs at the last minute. In many cases, you’ll legally be required to provide at least 30 days notice, but this varies by jurisdiction. Providing a full three month’s notice will give your tenant time to make any necessary budgetary adjustments to cover the additional costs on their end, and it can also buy some good will.
3. Refer to Your Local Rental Laws
   Nothing angers tenants more than illegal rent increases; not only will this ruin any chances of maintaining a positive relationship with your tenant, but it can also land you in serious hot water. Before you make any decisions about increasing the rent, make sure you’ve done the necessary legal footwork and everything is above board.

Don’t Neglect Proactive Property Upkeep

Performing regular inspections and convincing your clients to invest in proactive upkeep is essential. Not only does keeping a rental home in good condition help to eliminate the risk of catastrophic repair costs at some point down the line, but it can also reduce property management turnover. Well-maintained rental properties are more appealing and provide a better living experience for tenants, so it’s easy to understand why this has a direct impact on your retention rates.

Convincing reluctant investors to spend more money on their units often proves challenging, however. If you find yourself in between a rock and a hard place, it may be worth using financial projections to outline the benefits of spending more money upfront on property upkeep. Ultimately, this approach will put more money back in their pocket, so demonstrating the value of such investments can often get a stubborn property owner to budge.

Offer Renewal Incentives

Renewal incentives are another tool that can be useful in convincing tenants to sign a new lease.

Before offering an incentive, start by understanding your tenants’ needs and preferences. Incentives that add real value, such as discounted rent or upgraded appliances, can have a dramatic impact, but of course, you’ll need your client to get on board to do so. Have that conversation with your client before starting the renewal conversation with your tenants.

You may also be able to create a sense of urgency by highlighting the benefits of renewing early. For instance, offer a bonus for renewing within a certain timeframe, such as a one-time rent reduction or a gift card. Communicate these incentives clearly and positively through emails, newsletters, or in-person meetings. And of course, do your due diligence and make certain you’re not infringing on any housing regulations that prevent you from offering such bonuses.

Remember, timing is also crucial. Initiate renewal discussions well before the lease expires, giving tenants ample time to consider your offer without feeling rushed. Personalize your approach by tailoring incentives to individual tenants or tenant groups, making them feel valued and appreciated.

Ask for Feedback from Departing Tenants

In some cases, your hands are tied and you won’t be able to retain a tenant. Maybe the renter is purchasing their own property or moving out of state, for example. When a tenant does choose to leave, see if you can glean some useful feedback about their experience and identify any room for improvement for your team.

It may even be worth putting together a full-fledged exit interview process; automation tools like DoorGrow Flow can take the guesswork out of this process for you, making it easy for your team to consistently gather the right information.

After collecting your feedback, review it as a team to build a game plan to further strengthen your service offering. It might not make an immediate difference, but incorporating that feedback will ultimately help you to work towards reducing your property management turnover rates.

Are you dealing with operational problems that are cutting into your profits? Join the DoorGrow Mastermind and get personalized help for combatting your business’ biggest challenges. Schedule a no-obligation strategy call with our team to learn how we can help.