To maximize your return on investment (ROI) and avoid expensive turnovers and frustrating vacancies, you need to keep your best San Diego residents happy.
One of the main factors affecting your profits is resident turnover. Vacant rental properties can lead to significant losses in rental income and high expenses in terms of marketing, repairs, and maintenance. It’s essential to take proactive measures that will minimize turnover and keep your investment properties occupied.
We’re sharing some effective ways for real estate investors to retain residents and increase revenues. Remember that when you’re establishing a resident retention plan, it’s a good idea to think about those residents as valued customers. They pay rent, and just like with any customer, you need to show them that you appreciate and value them.
When you find and place high-quality residents, do everything you can to keep them.
Practice Good Communication and Active Listening
Good relationships with your residents will ensure you have an easier time retaining them. Those relationships depend on excellent communication. If there’s a complaint or a dispute, it’s likely that your residents want to be heard. Even if you cannot solve the problem, responding to their issue with empathy and care will make a big difference in how they feel about you and their rental experience.
Listen actively. Ask questions. Determine what they need to feel better.
Communication also means accessibility. Your residents will need to know how to reach you. It’s important to be available 24 hours a day in case there’s an emergency at your investment property.
Communication is key to maintaining a positive relationship. When you can communicate effectively with your residents and address their concerns as soon as possible, they’ll trust you, and they’ll be more likely to renew their lease agreement and stay in your property.
Check in regularly with your residents. Ask them about their rental experience, and get feedback on how you can improve your property and their comfort.
San Diego Investment Property Maintenance
Are you investing in your property? Making repairs is required. Making improvements is a good way to retain residents.
Let’s look at maintenance, first. Emergency maintenance problems require your immediate attention. If a resident calls to report a flood in the property or a problem with the sewer line, you need to get these things fixed right away to keep your residents safe and the property habitable.
Respond to routine maintenance issues with the same sense of urgency. A running toilet might not seem like a big deal, but your residents will appreciate your immediate response. It’s also a good way to protect the condition of your investment.
Beyond basic routine, emergency, and preventative maintenance, you need to think about curb appeal and modern upgrades. Consider improving the amenities and appliances in your investment property to enhance the living experience for your residents. Today, you’ll find a high demand for smart home technology such as Wi-Fi enabled thermostats and video doorbells. Be willing to provide what your residents want, and you’ll have an easier time avoiding turnover and vacancy.
Keep Rental Increases Reasonable
One of the things that can drive high turnover is a rental rate that does not match the market. When the rent is too high, educated residents will move into a home that provides more value for less money. When you’re establishing your initial rental rate, study the market. Access good data on what similar properties are renting for. At lease renewal time, do another analysis of the market. Set an increase that’s both compliant with any rent control laws and competitive in the current market. This will keep your residents in place.
Offer Lease Renewal Incentives
One of the simplest ways to avoid resident turnover and vacancy is to offer lease renewal incentives.
To incentivize residents to renew their lease agreement, you may offer something special at renewal time, such as a new appliance, a month of free utilities, or maybe fresh paint or a professional carpet cleaning. Look for incentives that they care about which will entice them to stay.
Does a resident want to adopt a pet? Offer a reduced pet fee. Have they asked for in-unit laundry? Consider providing a washer and dryer. These things will cost you a lot less than a turnover. You may also want to allow residents to make some adjustments to the property that will suit their preferences. When your investment property feels like home to your residents, they will be less likely to leave.
Screen Prospective Residents Effectively
Fair housing laws must be followed when you’re screening residents. You cannot use subjective criteria or stray from your established standards. Make sure you spend some time investigating a resident’s rental history as part of your screening process. You’re looking for someone who pays rent on time, manages money and credit well, and has a verifiable source of income.
You also want residents who complete their lease terms. When you’re screening, be wary of residents who have broken leases in the past, been evicted, or moved out after only a few months. You will avoid turnover and vacancy costs when you place a resident with a solid, reliable, and verifiable rental history.
High resident turnover can significantly impact your profits and quickly become a headache. As a real estate investor, you can take proactive measures to avoid turnover and minimize vacancy expenses. This includes setting realistic rent rates, keeping your property in good condition, communicating effectively with your residents, offering lease renewal incentives, and screening prospective applicants effectively. By adopting these methods, you'll be able to achieve a low turnover rate, minimize expenses, and make more profits as a real estate investor.
What you can also do is hand this over to a professional property manager in San Diego. We have an excellent track record of placing qualified residents and retaining them year after year. We invest in positive, productive relationships and we deliver an outstanding rental experience.
If you need some help avoiding these expensive turnover costs and vacancy days, contact us at PURE Property Management. We’d be happy to customize a resident retention plan that fits your property and your investment goals.
