Helpful Tips for Increasing Tenant Retention
October 31, 2016
One of the primary areas of concern for most landlords and real estate investors is high tenant turnover and lengthy vacancy cycles. From a business perspective, these will adversely impact your bottom line and eat up your profits. Consequently, one of the key responsibilities of a property management company is increased tenant retention and shorter vacancy cycles. Unfortunately, many landlords and rental property investors fail to realize how costly it can be to locate a replacement tenant.
High Tenant Turnover is Costly
Lengthy vacancy cycles can be very expensive. Not only do they cost you money, they can cost you a considerable amount of time as well.
As a landlord, you’ll have to:
- Conduct move-out and move-in inspections
- List and market your rental property
- Repair any damages and do any required cosmetic work on the home before a new tenant moves in
- Rigorously screen every potential tenant (including background and credit checks)
By the time you have done all this, you’ve invested a considerable amount of money and time.
Doesn’t sound too appealing does it?
Fortunately, there are companies that specialize in property management services for those individuals who lack the skills required to be a landlord or simply want no part of managing their properties.
Your Property Could Be at Risk
The longer your property sits vacant, the longer you won’t generate monthly revenue! You are also putting your vacant property at risk! For example:
- If water is not being run through the pipes during the colder months of winter, water or moisture that remains in the plumbing could freeze.
- Not running your A/C system during the warm summer months can create problems for your entire HVAC system.
- Should something happen to your rental home when it is vacant, such as a burst water pipe and flooding, there is no one to address the problem until help arrives.
- The longer your rental home is empty, the greater the likelihood that it will be broken into and vandalized.
Conversely, keeping your tenant happy is the best way to ensure higher tenant retention — which in turn saves you money and time. One of the best ways that you can maximize your return on investment is by keeping the same tenant in your home for a minimum of two years. The best way to increase tenant retention and save yourself a considerable amount of grief, stress, and worry is by letting a property management firm oversee the daily operations of your rental home(s). In addition to protecting your investment and receiving a good return, they can help you increase the value of your property as well.