Tenant turnover is a significant challenge for property owners and managers. High turnover can result in increased expenses, extended vacancy periods, and the continual challenge of finding new tenants. By understanding why tenants often choose to leave, property managers can develop strategies to improve tenant retention. In this article, we explore some of the primary factors driving tenant turnover:
Rent Increases
One of the most common reasons tenants move out is due to rent increases. When rent goes up, it can become financially unsustainable for tenants to stay on. This prompts them to seek more affordable housing or relocate to an area with lower living costs.
Solution: Be transparent about rent increases and provide advance notice. Legally in New Zealand, a landlord must give their tenant at least 60 days’ written notice of a rent increase. Justify the increase by highlighting any improvements or added services. Consider implementing smaller, incremental increases rather than large, sudden hikes.
Poor Maintenance and Repairs
Tenants expect their living conditions to be consistently well-maintained. When maintenance requests are ignored or poorly handled, it causes frustration and dissatisfaction. Continually unfixed problems such as plumbing issues, pest infestations, or broken appliances can drive tenants to look for better-managed properties.
Solution: Establish a responsive maintenance system. Prioritise urgent repairs and communicate with tenants about timelines for resolving their issues. Regularly inspect the property to catch and address problems before they are reported by tenants.
Lack of Communication
Effective communication between tenants and property managers is crucial. Tenants may feel undervalued if they can’t easily reach their landlord. They may also feel ignored when their concerns aren’t taken seriously.
Solution: Foster open lines of communication. Use multiple channels such as emails, phone calls, and tenant portals to stay in touch. Regularly communicate with tenants to address their concerns and keep them informed about property-related updates.
Changes in Personal Circumstances
Life changes such as job relocations, family expansions, or shifts in relationship status often require a relocation. These factors are often beyond the control of property managers.
Solution: While you can’t control these personal changes, fostering a positive living experience can increase tenant satisfaction. In turn, this boosts the likelihood of tenants recommending your property to others. It may also encourage them to return if their circumstances change in the future.
Noise and Neighbour Issues
Neighbour issues, like excessive noise or conflicts, can create discomfort in living situations. If tenants feel their peace and privacy are constantly disrupted, they might decide to move out.
Solution: Establish and uphold clear guidelines for noise and conduct within your property. Address complaints promptly, and work to resolve disputes with neighbours to maintain a peaceful living environment.
Safety and Security Concerns
Tenants prioritise safety and security. If they feel the property or neighbourhood is unsafe, they will likely start to look around for a more secure environment.
Solution: Invest in security measures such as good lighting, secure locks, and surveillance cameras. Ensure that the property and its surroundings is safe for all tenants.
Better Amenities and Upgrades Elsewhere
With the constant development of new properties and the upgrading of existing ones, tenants might be tempted to move to homes offering better amenities, such as modern appliances, spacious layouts, outdoor spaces, or energy-efficient features.
Solution: Keep your property competitive by investing in upgrades and amenities that appeal to your target market. Conduct surveys to understand what improvements tenants value the most and consider implementing them.
Unfavourable Rent Terms
Strict or inflexible rent terms can drive tenants away. High penalties for agreement termination, inflexible pet policies, or restrictive guest rules can deter many potential tenants.
Solution: Offer flexible lease options and consider accommodating reasonable tenant requests. Flexibility can make your property more appealing and keep tenants who might otherwise leave due to strict policies.
To improve tenant retention, property managers should first understand why tenants leave. By proactively addressing these issues, they can create a better living environment, lower turnover rates, and build long-term relationships with tenants. Investing in tenant satisfaction leads to a stable and profitable property management experience. These are guidelines that we have established through previous experience here at Rotorua Rentals. If you would like us to make sure your rental is appealing and want to secure a long-term tenant, we can help. Give us a call today.
