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Strategies For Tenant Retention

By
Services for Real Estate Pros with Rentec Direct Property Management Software Tenant Screening

Tenant retention is obviously one of the key factors when analyzing profitability of a real estate rental business. As landlords and property managers we know that retaining our current tenants is far less costly than having to find new ones. A vacant property can have a myriad of costs associated with it including; sitting empty for months, marketing, cosmetic repairs, and other expenses aimed at attracting new tenants. So we have to ask ourselves "how can we keep our tenants from wanting to move out and move on"?  To stay competitive and encourage current tenants to renew there lease or to attract new tenants some landlords have been giving out cash, rent cuts, and other gifts.

Some ways that I've tried to entice tenants include:

  1. First months rent free or discounted
  2. Pay utilities
  3. Free internet or TV access
  4. Include as washer and dryer in the unit

Once I have a tenant in place I try to keep them happy by:

  1. Address any complaint or issue the tenant has right away
  2. Offer a five day grace period for rent before a late fee is charged
  3. Keep up on property maintenance
  4. Painting and flooring replacement

Recent research has shown that monetary incentives are the most preferred type of discount. Rent discounts are the most preferred monetary incentive. Gym memberships and covered parking are the most preferred non-monetary incentive. The best time to offer incentives is during the initial lease signing phase or just prior to a lease expiring.

What types of incentives have you provided to your current tenants or incentives you have offered to entice new tenants?

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Dulcey is a member of Rentec Direct who provides Property Management Software, tenant ach payment processing, tenant screening and criminal reports for property managers and landlordsThe information in this post is just that, informational and should not be used as a substitute for legal consult or advice.

Comments (3)

Jacob Beeson

Great info! 

In our experience with thousands of tenants, monetary incentives seem to work best. 

As for other incentives, providing appliances might be a great idea too, but beware! If you provide the washer and dryer and it then breaks, you will be responsible for the upkeep/repairs on it. Then your incentive could double or triple depending on the type and scope of the repair. 

You might advertise the incentive as "$250 towards purchase of appliances" or similar language. The modern market dictates that a solid used washer and dryer set can be had for $150-$200. It's way cheaper to just pay for them than to own them! 

May 12, 2014 06:49 AM
Dulcey Schuster
Rentec Direct Property Management Software Tenant Screening - Grants Pass, OR
Property Management Software

Great points Jacob! I like your spin on the appliance purchase, that is a great idea. I have a unit with a W/D in it and am wondering if i should put them on CL next time it becomes vacant. They are about 10 years old and are going to be a liability for me at some point I'm sure. Thanks for the comment!

May 12, 2014 08:14 AM
Michael J. Perry
KW Elite - Lancaster, PA
Lancaster, PA Relo Specialist

Good tenants do not find themselves out in the street ! You beg them to stay !

May 02, 2017 07:08 AM