Property managers should remember that tenants are their customers and making their needs a priority goes a long way toward a more successful business.
Research shows that building great relationships with your tenants pays off. Large apartment communities do a great job of celebrating their tenants, while management companies in the single-family and condo space often struggle. Community events, appreciation nights, holiday cards, raffles, move-in gifts, and similar gestures help large apartment communities build relationships with their residents. Some of these tools may not work for a single-family home manager, but what they can mimic is this approach to tenant relationships
There is a pervasive business philosophy amongst many property managers that I call “Tenant Apathy Syndrome” or TAS. You will hear people with TAS say things like, “It’s just a tenant.” They look at the tenant as a necessary evil — a means to an end. They wonder, “How can I get away with doing as little as possible for my tenant?” They hope the tenant never calls or needs anything. However, they expect them to take great care of the place, pay more in rent each year, and stay forever. What other business has such a lack of empathy toward their customer?
If you are a property manager, the owner of the property is your client and the tenant is your customer. Without the tenant, nothing happens. If you want to be successful in business, learn what other successful people are doing and mimic them. The large apartment industry is often backed by Wall Street money. These investors have done tons of research, tenant surveys, and pored over data to find the secret sauce to maximize profit.
They discovered that providing an amazing experience for the tenant pays off.
There are those who do not view the tenant relationship as important and will not even talk to tenants if they can avoid it. I argue that talking to the tenant is just as important as talking to the owner. Those who recognize the opportunity in front of them will set themselves apart from the competition by offering the tenant the great service they are looking for. It’s an easy way to stick out from the crowd, by being a company that focuses on a great tenant experience.
Here are some things the large apartment communities do to attract and keep the best tenants. You can do these things as well.
- Answer the phone: When you are marketing a property, have someone who answers your rental calls seven days a week. Answer all the calls that come in and provide the best customer service you can. Very few do this, so this sets you apart. There are companies that specialize in prospective tenant calls who can always be available.
- Make the right first impression: Only show vacant homes that are rent ready. The best tenants only rent clean and attractive homes. You tend to attract bad tenants when you show a lived-in, cluttered home. Since the property shows better, you will get a better price when you show a cleaned and move-in ready home. This approach also eliminates issues at move-in where the tenant thought they were going to receive the home in better condition then they got it. The multifamily industry has done tons of studies on this. That’s why they never show occupied properties.
- Get online: Have everything online. Applications, lease signing, maintenance requests, and rent collection can all be done online these days. The millennial generation is the “right now” generation. They expect things to be online, fast, and easy.
- Personalize it: Provide move-in gifts or other special touches to your leasing and move-in process.
- Get feedback: Survey your tenants after they move in and after maintenance is completed to make sure they are satisfied.
- Be responsive: Handle maintenance quickly, using professional vendors.
- Celebrate: Celebrate your tenants’ birthdays and the anniversary of leasing.
- Be fair: Be fair with a tenant’s deposit. Don’t nickel and dime them when they leave the place in great shape. This leads to fewer deposit issues and court appearances, and appeases the real estate gods.
- Welcome your residents:
- Welcome interaction with your tenants. Go out of your way to communicate.
Does this new way of approaching the tenant relationship mean every time a tenant asks for something, you need to do it? Of course not! Sometimes customers are unreasonable and demanding. It is our job to explain, in a professional manner, why we can’t do something. For example, we often explain to tenants that the owner has a fixed budget for this property, so certain discretionary repairs cannot be done at this time and they can revisit later in the year or maybe you can even offer them a property upgrade at lease renewal. When communicated clearly and with professionalism, most tenants understand. Most of your competitors are still suffering from TAS, so a little good will from you will make you stand out.
You may see the value in this approach and decide to make big changes to how you approach the tenant relationship. Even if you just change your mindset, you can operate your business more profitably with fewer headaches.