When a rental property turns over, the owner has to fork up the cash to do all needed repairs and updating to the property to make it rentable and desirable again. This can include catching up on any deferred maintenance, cleaning the entire property, freshening up the landscaping, advertising the space, answering inquiries, showing the property, screening applicants, signing leases, getting fees to property managers, and watching the days go by as your property sits empty with zero rent coming in. It can be painful if you don’t know how to minimize this profit-draining event.
While some of the factors that go into tenant turnover are outside an owner’s control, there are many things owners can do to effectively reduce property vacancies and produce lower turnover rates. Below we will share four strategies for improving tenant turnover rates in commercial real estate.
Communicate
Providing your current tenants with quick and thorough responses to their questions or complaints will go a long way in retaining them. Knowing the landlord cares and is on top of everything gives occupants a sense of security and satisfaction. Tenants that feel their concerns are being adequately addressed are much more likely to stay rather than dealing with the alternative of having to move. If a tenant makes an effort to connect with you regarding the property, even if it’s concerning something simple, it’s important to always let them know you received their message and that you will take swift action to address their concern.
Another important piece of this puzzle is taking the initiative to reach out to your tenants to get their feedback. Even if they haven’t voiced any concerns or relayed any issues to you, it doesn’t necessarily mean they don’t have any feedback to share. Landlords who do not connect with their tenants are neglecting a very basic level of service that could lead to those tenants moving out once their lease is up. Something as simple as checking in every few months to make sure your occupants are content and have everything they need will go a long way in terms of tenant retention and satisfaction.
Always Keep Curb Appeal High
It’s no secret that tenants are often willing to pay more to rent a quality property that is in tip-top shape. How others perceive the property is a significant detail that many tenants sincerely value.
Using resources wisely to invest in your property’s appearance so it appeals to a wide range of people is a great way to retain the quality tenants you already have. This way, you won’t have to spend time and money to advertise your vacancy, screen applicants, or get the property ready for the next tenant. You’ll maintain the steady and consistent cash flow from your existing occupants who opt to renew their leases.
The easiest improvements you can make to enhance the appearance of your property may include things like applying strategic lighting, beautiful landscaping, and a well-maintained building with minimal clutter. These are ways owners can stay one step ahead of the competition, which will increase the value tenants feel for the property. Putting more of an emphasis on the way your property looks can translate to lower tenant turnover rates, and higher rent returns in some cases, in the long run.
Find the Right Tenants
Screening tenants for your vacancies is always a time-consuming task. Depending on how many are interested in your property, you may spend days, or even weeks, reviewing all the candidates. Fortunately, if you have enlisted the services of a reputable property management company, this process is generally a lot smoother as the property management team will deal with this process from start to finish based off of the tenant requirements you set with them.
To avoid having to go through this process over and over, it’s always easier to retain the tenants you already have. A big part of this is making sure you get the right tenants in the first place. A quality tenant is going to have a strong rent history, meaning that person consistently paid their rent on time, did not break lease agreements by leaving before the lease was up, and has solid references.
You can also ask your current tenants to recommend their family or friends when a space opens up. If you have a good relationship with your tenants, chances are they won’t recommend anybody they don’t think is responsible or would be a good fit. This will also strengthen your connection with your current tenants by renting to the person they referred, in addition to filling the vacancy quickly and more efficiently. However, it’s important to note that a thorough applicant background check should always be conducted regardless of who the applicant was referred by.
Go Above and Beyond
As an owner, if you’ve reached a point where all your vacancies are filled with reliable tenants, you’ll want to maintain that status as long as you can. Keeping your tenants happy and satisfied is always an ongoing process. Apart from the typical routine maintenance and services that arise, you may want to think about offering property-specific perks and advantages. Thinking outside the box and offering perks can really boost your tenants’ loyalty and desire to want to stay.
Photo by Dylan Gillis on Unsplash
