As Tenant turnover is one of the most expensive parts of owning a rental business, landlords work hard to enhance their tenant retention rate.
FREMONT, CA: All landlords intend to keep high-quality tenants in their rentals to minimize vacancies. Still, you won’t ever find the perfect tenants to stay in your properties long-term. Tenant turnover is also the most expensive part of owning a rental business. Hence, landlords work hard to increase their tenant retention rate. If you’re seeing for ways to grow your rental business and experience fewer turnovers, keep reading as we review some tips.
Why is Your Tenant Retention Rate Important?
Your tenant retention rate is considerable because it measures the number of tenants that stay in your property for multiple rental periods. Finally, it gives landlords an idea of how many tenants are sticking around and suggests areas for improvement if tenants don’t stay.
Calculating your tenant retention rate is important to evaluate how your rental business is doing. Also, if you have a low retention rate, you can explore areas of advancement to increase your rates. Even so, fewer turnovers in your rentals can magnify your overall return on investment.
How Can Fewer Turnovers Help Maximize ROI?
Landlords that have lesser turnovers can experience higher returns. Even so, when tenants stay in your rental properties, you have consistent income that covers some of your expenses. In contrast, you’ll need to utilize savings or pay out of pocket for some expenses if you have several vacancies.
The upper your retention rate, the more your rental business succeeds. When you keep tenants in your rentals, you can make up for some inevitable costs of running a rental business. For instance, if you have a low retention rate, you need to account for factors such as:
• Rental property marketing
• Vacancy time
• Leasing fees
• Tenant turnover costs
• Valuable time
These costs can add up swiftly, and if you’re not generating income from tenants each month, it can induce more stress. As such, it’s crucial to work towards a high tenant retention rate.
