Rent growth, occupancy, revenue. The key performance indicators are all up across the country.
But the conversation about the metrics today is about when they’re going to start going down. Every veteran of the multifamily industry knows it’s going to happen … sometime. It might not be tomorrow, but the downturn in the cycle is going to happen.
When it does, the scramble to renew residents will commence in a hurry. Communities across the country will develop retention programs, improve customer service initiatives, slash renewal offers and even offer incentives to stay. The time to start some of those retention efforts, however, is now when times are good.
Waiting to implement that customer service initiative or retention program until your metrics go south will put you way behind the curve against your competitors. Implementing them today, when your leasing associates aren’t stressed to the max to meet their goals, could stave off the flood of move-outs when the market does turn. If you can get residents to renew when rent increases are this high, you can get them to renew under any market conditions.
Several owner/operators, such as Alliance Residential and Cardinal Group Management, are already prepared for the renewal scramble. At our 2016 Summit, they shared a few tips with us to help generate renewals:
- Survey residents and take action. Many resident issues are never communicated, because some residents are too busy or avoid confrontation. Resident surveys can uncover issues that you might not have known existed. More importantly, onsite teams need to take action on customer requests and suggestions. Fixing concerns presented in surveys builds trust and loyalty.
- Create customer touch points. Technology is great and emails are necessary, but sometimes a little personal interaction works best. Alliance and Cardinal have both undertaken exercises to determine when they have opportunities to have personal and electronic interactions with their residents. Some of the interactions are timed and designed to encourage renewals. Alliance sends a pre-renewal survey 90 days before the renewal date. Even before sending that survey, they encourage onsite teams to stop by the apartment and drop off a gift so they can discuss the resident experience.
- Train your maintenance technicians in the ways of customer service. Your service technicians are probably fantastic at repairing faucets, HVAC systems and a host of other items at your community. Because they interact with residents more than any member of your leasing staff, they are essentially the face of the community. Providing customer service training to them shouldn’t be an afterthought, it should be front and center. Teaching them to provide simple touches, such as handwritten notes or even engage in small talk with residents can go a long way to creating positive experiences.
- Brand your communities or company. Brands are more than the slogan or the pretty logo on the front door. They’re an aggregate of the experiences your customer has with your company or community. Whether you put your company brand on your communities or have different names and logos for each community, residents will associate their experiences with that name or logo. In other words, just because your slogan says “great service” in it, doesn’t mean that’s your brand. Your brand is what your residents say it is. Of course, you should spend the time to create catchy slogans and beautiful logos, but you also have to train and empower your associates to act in ways that meet the promises your slogan and logos make to residents. Effective branding with this holistic approach will lead to increased renewals.
While these suggestions don’t guarantee that residents will renew, they’re a great place to start preparing for the eventual downturn. Wait too long and you might be scrambling for leftovers when the downturn officially hits.