As the owner of a rental property, you’ve seen it all. Vacationers coming in and trashing things, long-term renters letting harmful dirt, grime, and debris build up in every area of the house, and people just not taking care of your home the way you deserve.
However, not all tenants are bad. There are some who are respectful, clean, and always pay their rent on time. Any seasoned property owner knows that these are the types of tenants you absolutely want to keep around for as long as possible. You likely also know how difficult it can be to find these tenants in the first place, which is why keeping them around is critical. This week’s Mountains-n-Plains Real Estate blog discusses tenant retention and its importance.
Mountains-n-Plains Real Estate is a management company that works to protect and manage owners’ rental properties. Our team of professionals understands that owning property can be stressful, especially when renting it out to other people you don’t know, and that’s why we’re here to do everything we can to keep your property protected and in the best condition possible. Read this week’s Mountains-n-Plains Real Estate blog post and reach out to our team of experts to learn more about our property management options!
What Is Tenant Retention?
Tenant retention is the turnover rate of tenants at one specific property. In other words, tenant retention measures the number of tenants that stay at your property for multiple rental periods. Not only can this help determine how many people are sticking around, but it also gives you, the property owner, an idea of your growth and progress.
Why Is Tenant Retention Important?
So, why does any of this matter? As long as you have someone in the house, why should you have to measure these rates? Well, a higher tenant retention rate can be very beneficial for your business, and a lower one can be costly, and as a property owner, you need to know whether your property is losing or making money.
Let’s first discuss the ways that high tenant turnover rates can harm your rental property (and your pocketbook).
- Vacant properties mean a loss of profits –– While you’re in between tenants and screening new ones, you’re losing money as long as your property is empty and you’re not collecting rent.
- Cleaning and moving expenses –– It’s likely that each time a tenant moves out, there will be some cleaning that needs to be done. No matter whether you decide to hire a professional or do it yourself, you’re spending time and money to make the property look presentable again.
- Expenses of screening tenants –– Your rental property is important to you, which means that keeping it in good condition is a must. In order to ensure this happens, you’ll need to screen potential tenants and select only the best ones that you feel will take good care of your property. However, doing so comes with expenses, just like many other things throughout the tenant turnover process.
It’s also important to note that depending on the age, condition, location, and other factors relating to your property, it may need upgrades and repairs, which will cost you extra whenever the current tenants move out.
Now that we’ve discussed some of the ways that tenant turnover can be costly, let’s talk about why keeping the same tenants around for multiple rental periods can be beneficial.
- It prevents vacant periods –– As discussed above, vacant periods cost you money. However, if you have someone in the property at all times, you won’t have to worry about losing money here.
- Keeps the property in good condition –– If you’ve found tenants that always pay rent on time, take good care of the property, and communicate well, you’ll want to keep them around, as this will help keep your property in great shape for years to come.
- Saves you money on all expenses mentioned above –– If the same tenants remain, you won’t have to worry about paying professional cleaners, repairing or upgrading things, etc., which saves you money.
How Can You Achieve Tenant Retention?
As a property owner, you play a large role in keeping tenants around. Here are some things you can do to boost your tenant retention (and your profits).
- Screen tenants thoroughly: Make sure that the tenants you select are willing to put in the work to keep your property in good condition and have the credit or funds available to always pay rent on time.
- Send out a survey: If you’re unsure of what your tenants are looking for, send out a survey to better understand how they’re feeling and whether they’re enjoying your property. We recommend throwing in a gift card or other treat and making the surveys anonymous to provide some incentive for completion.
- Put more into maintenance: If your tenants are complaining about issues within your property, be ready and willing to put some extra funds (and time) into fixing them and making some upgrades so your tenants can live comfortably.
- Communicate: Despite the fact that you’re the property owner, your property is still your tenant’s home, so it’s important to be respectful of their space. Communicate when you plan to enter the property, drop items off, etc.
Invest in energy savings: Housing is expensive enough as it is, and with utilities added, it can be overwhelming for some. That’s why we recommend investing in energy savings. Not only will it help save your tenants money on energy bills, but it also helps the planet!
- Hire a property manager: When it comes to property management, you may not know the ins-and-outs, and that’s okay. However, if this is the case, we recommend you hire a property manager who has experience handling tenant issues in a professional manner.
Choose Mountains-n-Plains for Your Property Management Needs
At Mountains-n-Plains Real Estate, we know that keeping good tenants around can be a difficult feat. That’s why our team will go above and beyond to help improve your tenant retention. We want to help you keep the best tenants so that you know your property is always in good hands.
If you’re having trouble marketing your property, we can even help you do that! We’ll help get your property out there, screen each tenant, and help make the best selection for your property, so you can rest assured that you’re getting the most out of your investment!
To learn more about Mountains-n-Plains Real Estate and our property management services, reach out to our team in Northern Colorado today!