Profit by keeping existing tenants!

Experienced property managers understand just how difficult it can be to find good tenants, which is why retaining them is so important. According to research, over 60% of residential turnover is almost inevitable.

6 Things you should consider for your Lease Renewal

Property managers often feel like they have to jump through several hoops to keep one of those tenants they like. However, if you find yourself in a similar situation, you should consider these few factors first.

1. Be aware of the current market rent before you start the process?

It is very important that you are aware of what a similar unit in your area will rent for in todays market. This way you can approach your existing tenant and start the negotiation with confidence. Current market rent can be obtained online on sites such as craigslist, by driving around the neighborhood and looking for rent signs, by checking with your local real estate office. You can also instantly attain a professional market rent report for your rental through iManageRent, click here to see a sample of the information provided.

2. Are you looking to rent month-to-month?

One of the biggest reasons tenants leave a house is because of bad customer support or because the house owner won’t budge. According to this study on tenant behavior, the number of tenants who think this way is as high as 68%.

Therefore, are you willing to change the tenancy agreement entirely if you want to retain a tenant? Some tenants might not be comfortable settling down for as long as a year or two but would instead prefer having to renew the contract every month. While the month-to-month contract does mean that tenants can cancel the contract with just 30 days of notice, you can also charge them more in rent.

3. Are you looking to increase rent with your lease renewal?

Another important thing you should consider is if you will increase the rent when renewing your lease. Renters have plenty of options to choose from when searching for a new apartment to rent. Therefore, are you looking to increase the rent with the new lease since that can greatly affect the tenant’s decision to stay?

The best way to go about telling them about an increase is by talking to them a month or two before the lease term ends. You want to at least negotiate with them and find a middle ground where both parties are happy.

4. Do you want to renew for the exact same term?

You should also look into if you want to renew the agreement for the same term or if you are looking to extend it. Similarly, do you want to reduce the term for the next lease? Either way, you should make the changes clear to your tenant to ensure they don’t like you are making any major decisions without informing them.

5. How much time will you be giving the tenant to respond?

One of the tried and tested lease renewal tactics most property managers will use is giving less time to tenants to respond. This can prove to be a very effective tactic, as most tenants might buckle under pressure and choose to stay longer.

However, this technique is one that you should use sparingly, especially if you wish to maintain a better relationship with your tenant. If you keep pushing them into a corner to make decisions, they might finally decide to leave, and you could lose a valuable tenant.

6. Is your tenant worth keeping?

While this might seem like an obvious question to ask when working on your lease renewal, you should really consider it. Do you want to keep working with the current tenant, or would you prefer if someone else moved in?

Your tenant might be open to the changes you are making to the lease, but they might pay their rent late. Make sure you consider everything that they have to offer you before you make your decision.

Final thoughts

Finding the right tenant and retaining them can be challenging tasks, but making these considerations before working on your lease renewal can help you make a more informed decision. Also keep in mind retaining existing tenants will help you avoid unnecessary vacancies which bolsters your bottom line. If you’re looking for an online software to help you list your rental, screen tenants and keep track of their lease, why not look into iManageRent?

iManageRent provides landlords, property managers and tenants tools to better manage the life cycle of a rental property. From listing vacancies to background checks, online rent payments, late fee accounting, security deposit accounting, document storage, to much, much more… please feel free to join us today!

iManageRent is here to help answer any questions you may have about managing your rental. Our knowledgeable, experienced support staff is available 24-7 and can be contacted by phone at (415) 881-3311 or by email at Support@iManageRent.com anytime.

If you like to see our product in action please schedule a live one-on-one online demo by clicking here.