Retaining tenants will increase your earnings and create stability for your investments, which makes it a priority for us, as property managers who are consistently looking for ways to protect your profitability and your property.
Maximizing tenant retention is also the best way to reduce vacancy and avoid turnover costs.
Let’s talk about holding onto those tenants who pay rent on time and take good care of your rental. Tennessee rental property owners who can keep tenants in place will ensure their income is consistent and recurring. That’s what we’re after, and we’ve spent some time establishing systems and processes that increase tenant satisfaction and drive up retention rates. Here they are.
Creating a Tenant Retention Strategy that Fits the Tennessee Rental Market
Tenant retention is not a one-size-fits-all strategy. We know this because we’ve managed hundreds of properties; all of them with unique strengths, challenges, and needs.
Tenants are unique and diverse, too, and they’re always prioritizing different things in their rental experience.
Let’s look at Nashville, which has an increasing population that’s driving more and more tenants into the market. To meet that demand, we have a lot of new construction coming onto the market, and that means well-qualified tenants have choices. The goal is to keep those qualified tenants choosing your home every time the lease renewal date approaches.
Some of the things to think about as we approach tenant retention throughout Tennessee is that markets such as Nashville are growing quickly, and demand for rentals remains high. There will always be seasonal rental trends at work. A vacancy during the winter holidays, for example, will be much harder to fill than a vacancy during the late spring. Retention is especially important during those seasons with less activity in the rental market.
How Does Tenant Screening Impact Retention?
Retention starts before a tenant even signs a lease. Proper screening helps ensure that you’re selecting responsible, stable tenants who are more likely to stay for the long-term. As you’re reviewing applications and verifying rental history, you want to pay attention to how long applicants stayed at former rental homes. Are there lease breaks? Did they move every year? Those could be potential red flags, especially if you’re renting with the intention to retain.
Best practices around tenant screening include:
- Credit and background checks. These are obvious ways to ensure that your applicant can demonstrate financial responsibility and a commitment to lease agreements.
- Verify income and employment. A tenant who struggles to afford the rent is not a tenant you want to keep in place.
- Rental references. It can be time consuming to reach out to prior landlords, but those are the sources who can deliver honest insights about payment history and behavior.
In Tennessee, landlords must comply with the Uniform Residential Landlord and Tenant Act (URLTA), and fair housing laws are always important during the screening process, so make sure you’re attentive to those when placing residents.
Competitive Rental Rates Retain Tenants
Rental rates can fluctuate rapidly. Profitability is important when setting a rental price, but you also want to be mindful of competitive pricing. This encourages tenants to stay when renewal time comes around. You’ll want to make sure the renewal amount is competitive. Don’t chase good tenants out of your property by raising the rent 20%.
Our tips around renewal pricing:
- Get an idea of where the local market falls in terms of rental values. We can share our reliable and up-to-date data with you.
- Consider what your tenants would have to pay if they decided to move out. When it’s cost effective to stay, even with your rental increase, they’ll renew the lease.
- Offer incentives for long-term leases. We have seen some landlords succeed in keeping tenants in place longer by offering lease terms that might be 15 months or 18 months instead of the standard 12 months.
Even a small difference in rent can influence a tenant’s decision to stay or leave. When tenants are already happy with your property, they’re willing to pay a bit more at renewal time.
Tenant Satisfaction and Retention
Tenant satisfaction is really what drives retention. Nothing drives tenants away faster than a bad rental experience. If their calls are ignored and their maintenance requests take weeks for a response, they’re less likely to stay with you for another lease term.
Maintenance is an especially huge factor when it comes to tenant satisfaction. No one is going to stay in a property that is deteriorating. Make this a priority in the way you rent out your property. As property managers, we have the benefit of technology to keep our systems streamlined and responsive. We respond within 24 hours to all inquiries, even if it’s just to acknowledge receipt.
It’s important to have a network of trusted contractors to handle plumbing, HVAC, electrical, and cleaning.
Tenants who feel heard and respected are far more likely to renew their lease agreement. If you’re managing on your own, be sure you have the time and the resources to be responsive and available to your residents.
Invest in preventative maintenance when you’re focused on retaining tenants. Don’t wait for a complaint. Instead, take steps such as:
- Conducting seasonal inspections, especially for HVAC systems before summer and winter.
- Investing in regular gutter cleaning, pest control, and lawn care.
- Making upgrades to appliances, lighting, or flooring every few years.
A clean, well-kept property reflects professionalism and signals to tenants that you care about their experience.
Tenants in Tennessee are Seeking a Sense of Community
Retaining tenants is easier when those residents feel connected to the property and the people around them. This is especially true in multi-unit properties or complexes. We’ve found that there’s a strong need for community among renters today, especially as the world seems more uncertain and complex.
Here’s how many landlords in Tennessee are finding ways to create a sense of community, which leads to an increase in retention rates:
- Organizing tenant appreciation events, like a summer cookout or holiday gathering.
- Sending occasional newsletters or updates about property improvements or local events. It can be helpful to create a private social media group just for your existing tenants.
- Consider a referral bonus for tenants who bring in new renters.
In cities across Tennessee, where communities can be close-knit, a social connection can be a powerful retention tool.
Offer Lease Renewal Incentives
As lease renewal time approaches and an existing term is ending, give your existing residents every reason to renew their lease. Maybe you’ll offer a free amenity upgrade. Has your tenant asked for a new microwave? Now is the time to provide it. Instead of simply handing the tenants a lease renewal and asking them to take it or leave it, be willing to have a conversation about what would make them happier in their home. This type of negotiation could lead to a better experience for them and a renewed lease agreement for you.
Pay attention to timing. Reach out at least 60 days before lease expiration so tenants have time to consider and respond without feeling rushed. Your lease agreement likely indicates how much notice tenants have to give before they vacate, so you want to get ahead of that deadline as well.
Build Strong Landlord-Tenant Relationships
People tend to stay where they feel respected. Make it a point to treat your tenants like valued customers and not just a source of rental income. Check in with them from time to time, especially after repairs, to ask if everything is going well. Send a holiday card or small gift during the holidays.
Property Management and Tenant Retention
If you’re not already working with a professional property manager in Tennessee, it could be your competitive advantage when it comes to tenant retention. We have the time, resources, and expertise to invest in tenant relationships that deliver a more pleasant experience for residents and a more profitable experience for you, as a property owner. Tenants appreciate our online systems for rent payments, maintenance requests, and communication. We’re providing great service even while holding them accountable.
We know that tenant retention is a long term investment. There’s no single strategy that’s going to result in long-term leases. But, we’re focused on consistency and we’re investing in care. Our attention to tenant needs is just one part of our full-service management plans.
Every rental property owner understands that this is a relationship business. Invest in good tenant relationships, and you can expect better tenant retention, which will maximize your earnings and your success.
Professional property management can help streamline operations, improve tenant satisfaction, and boost retention. Reach out today to learn more about how we can help you keep your best tenants year after year. We’d love to hear from you at Apex Ventures, Inc.
