SPIKE INSIGHTS

5 ways property owners and landlords can boost their bottom line by improving tenant retention

Ask any landlord or property owner what the most stressful part of their rental business is, and their likely response will be tenant turnover. Ensuring resident satisfaction can seem like a daunting task, but with digital technologies such as resident portals and mobile apps, they can have a positive impact on your bottom line.

Here are 5 ways in which resident portals can lead to an increase in tenant retention. 

Why is tenant retention important?

Low retention is a problem because gaining new tenants is not a cheap process, and any month without rent is not just a loss of income but a potential expense. Tenant quality also plays an important factor, as poor-quality tenants often result in costs not recoverable from the security deposit alone. When acquiring new tenants, there are a whole host of factors that quickly increases the costs:

  • Advertising – Listing and promoting your property online using sites like Zoopla or Rightmove requires you to pay a fee, and the more properties you have to list, the more that fee will be.
  • Letting agent fees – If you employ a lettings agent, the letting fee can range from several hundred pounds to the first month’s rent.
  • Vacancy time – In reality, you are unlikely to find a tenant that is move-in ready, so on average a property could be vacant for around 22 to 33 days, or even longer. That means one to several months of no rent coming in.
  • Turnover costs – Average turnover costs within the industry come in around £1,200. However, depending on a wide variety of factors specific to the property, this number could be significantly higher.

Prioritise communication

According to NMHC and Kinglsey’s 2020 Apartment Resident Preferences Report, 31% of residents who do not choose to renew their lease are seeking better apartment management. By prioritising communication, you are showing your tenants that their comfort and their issues are important to you. If tenants are always having to chase you down to get an answer to their question or a solution to their problem, the likelihood of them staying around for very long is reduced.

By offering residents a mobile portal, you are providing them with a central place to communicate with you. Rather than being constantly bombarded with phone calls or emails, day and night, you can simply review and respond to all queries that have come through via the portal.

Furthermore, with resident portals like Spike Living, you can also promote a whole host of content, from frequently asked questions, appliance guides, to fire safety procedures, as well as the latest news from the wider community. Having this information online means that more often or not, tenants can find the information they need themselves, without having to disturb you.

Finally, small personal touches go a long way in showing your tenants you value them. For example, by capturing their date of birth, or original move-in date, you can then provide personalised acknowledgments of things like birthdays and moving-in anniversaries, which is an easy way to help your tenants feel cared for.

Efficient maintenance and repairs

Maintenance, repair, and appliance replacement costs are among the main concerns when it comes to increasing margins. Repair costs during a bad month can easily outweigh profits. Having quality tenants who take pride in their space will certainly help keep maintenance and repair costs low, but they can be even lower.

One of the advantages of solutions like Spike Living is that it allows tenants to report issues when they arise and ensures you can respond in a timely manner before they potentially escalate to a much bigger problem. Without an easy way to get in touch, your tenants may leave an issue unreported. For instance, a rattling boiler left unchecked could ultimately mean being replaced much earlier than needed. Mobile apps speed up the communication in these instances and provide your maintenance staff with more information about the task ahead. Spike Living captures all enquiries and defect tickets centrally, so they can be tracked and shared between teams, keeping the resident informed at all times.

Using a centralised communication tool, you can also be proactive when it comes to informing residents about issues within the building. For instance, if you know that the lift is going to be serviced at a particular time, you can let the tenants know in advance, so they won’t be surprised when they see the lift is out of action.

Pre-qualify and screen all tenants

If landlords do not start with a qualified and quality tenant, retention rates will be the least of their worries. Tenant screening is the most important part of the rental process and has a measurable impact on the potential turnover rate. Early detection of tenants who could cause damage to the property, break their lease, or pay rent late will help property owners and landlords to begin the lease with the best possible option.

Spike Lettings provides complete end-to-end tenant management, starting from initial enquiry, through the reservation stage, all the way to moving in. Tenants can view the progression of their tenancy, communicate with your team, sign contacts, and even make payments, all within Spike. We recently partnered with Flatfair to make the tenant onboarding process much slicker, meaning upfront deposits are no longer needed. Tenants can simply pay a one-off membership fee equal to one week’s rent (+VAT) at the start of their tenancy, authorise their debit card and settle bills at the end – similar to hotel’s check-in and out.

Offer online services

Another way to avoid unexpected vacancies is to have a modern approach to tenants accessing the services they want. According to research by NMHC and Kingsley, 58% of renters would rather pay rent using a resident portal mobile app than a property website via laptop/desktop.

When rent is easy to pay, tenants are more likely to pay it. If they have to jump through hoops to pay their rent, the chances of it being late increases. With solutions like Spike Lettings, you can also send out reminders to tenants a day or two before their rent is due and can even automate confirmations to let them know that their rent has been paid. This will also make your life easier, especially if you manage multiple properties. Instead of waiting around for payments to come in or having to chase down tenants across multiple properties, you can easily view the status of each property, what rent has been paid, and what has yet to come in, all via a single dashboard.

If you have onsite facilities like a communal gym or meeting rooms, resident portals can provide tenants with the ability to book themselves. This encourages them to enjoy the facilities, without needing to phone or email anyone every time they want to gain access. Staff can also set limits on the number of people who can use a facility at any given time, ensuring amenities are COVID-secure, and users are adhering to social distancing guidelines.

Community engagement

Research by Apartment Life found that the more friends a resident has within their building, the more likely they are to renew their lease. For instance, if they have 1-3 friends, then there is a 38% they’re renew, and if they have 7 or more friends, the chances jump to 47%. With features like clubs and forums, Spike Living allows an easy way for tenants to find others in their building who share similar interests, such as a book or wine clubs, as well as enabling residents to organise their own events to get to know each other.  

Thinking about the even bigger picture, you can also connect residents with local shops and services, bringing convenience to their lives. Many of Spike’s customers team up with local businesses to offer special discounts to their residents on anything from cleaning services, dog walkers, to local restaurants.

It’s also proven that residents who are engaged with their local community are often happier than those who are not, and tend to post positive reviews about where they live on websites like HomeViews. These reviews can help attract new prospects and keep occupancy rates high and having residents as champions is an effective tactic if you want to increase interest in your property, whilst reducing your marketing spend.

Summary

To boost tenant retention landlords must be proactive. This means not waiting until a tenant is unhappy or threatening to leave before taking care of their issues. It also means being accessible, consistent, and flexible. With technology solutions like Spike Living and Spike Lettings, landlords and property owners can ensure tenants remain informed and engaged at all times, and ultimately a happy tenant is much likely to remain a long-term tenant, making it better for your bottom line.

Learn how Spike is working with a growing number of customers to drive resident engagement and satisfaction by downloading our brochure below.