Renter Retention Timeline Strategies
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In 2016, the apartment industry will see the most new units delivered to the market since the post-recession cycle began around 2010. Axiometrics, a Dallas-based real estate research firm, says more than 300,000 new units will come on line this year, which is well above 2015’s plentiful 265,000 total. Some markets, such as New York and Houston, will gain more than 20,000 new units alone.
With this influx of new inventory, occupancy levels are expected to fall, though evidence of declining rates has not yet materialized. Kingsley Associates, a San Francisco–based real estate research firm, reports a steady decline in renewal intent since 2013, with a new low of only 51.5% of renters saying they “probably would” or “definitely would” renew their lease in the first quarter of 2016, according to Kingsley’s Multifamily Industry Trends report for the first quarter of 2016. That share is down from 54.9% at the end of 2013.
So much new product coming to the market could ultimately make switching properties an easy decision for unsatisfied residents. So, how can property managers ensure that their property stands out among the competition and is the right fight for residents?
“Most of us have already figured out what to build and how to build it, and so we all look a lot alike,” says Laurie Lyons, partner at Cardinal Group Management, a Denver-based firm that owns and manages apartment communities across the country. “So, instead of trying to go head-to-head [with the competition]—because residents are only going to go out and get something the same again—we try to get them to fall in love with where they live and make it become their home.”
With retention quickly becoming a top priority for property managers this year in the face of a booming rental market, Multifamily Executive looked at the critical components of apartment properties that compel residents to renew their leases. Click through the menu above or the next pages below for a start-to-finish time line of how managers should handle each pivotal stage of the retention process. Read the articles below for ways to deal with the factors that pose a threat to lease renewals and how to best staff properties so that residents feel at home.