You did everything right to advertise your property and you were rewarded with wonderful tenants with an excellent track record for paying on time. Your renters play by the rules, treat your property with respect and keep the place clean. You have never had a noise or nuisance complaint, and they always park in the right spot. So what can you do to encourage your excellent tenants to sign on the dotted line when it’s time to renew their lease?
Provide an Incentive
Show your tenants that you value your relationship with them by offering an incentive to stay on. As the rental expiration date draws near, find out what their plans are for the future. It can make sense to seal the deal with a motivating gift or upgrade, especially if your renters indicate that they are not sure about renewing their lease.
Incentives come in different forms, and there are no hard and fast rules. You might offer a discount if they sign a rental agreement for more than a year, or you can wow them by promising a spectacular gift like a new “smart” TV when they sign the rent renewal. If you are not sure what to offer, you can always present a gift card. Some landlords simply give their tenants a choice and ask what they would prefer.
Here are a few ideas for appealing incentives that your tenants are sure to appreciate.
Reinforce your Good Relationship
Rent renewal is a good time to cement your relationship with your tenants by reviewing the rules and regulations. This is your chance to provide important information and go over what they should do in case of a problem. Your tenant’s clear understanding of what is expected can go a long way in avoiding conflicts. Present your instructions in writing for future reference, and discuss procedures for dealing with issues such as a broken appliance, a problem neighbor or an emergency situation.
You may decide to hire a property management company to take care of tenant issues. Hiring a property manager can make sense, especially if you do not live in the area, have more pressing responsibilities that take up your time, or if you just want to put a real estate professional between you and the tenant. Here are some common topics you may want to bring up with your tenant, especially if they have caused problems in the past.
Maintain your Property
By demonstrating your pride in ownership, you can encourage your tenant to value and respect your property as well. A well-maintained home will make your tenants more comfortable and make it more likely that they will renew their lease and stay on. Understand that a broken or underperforming appliance or a pest control problem can be a real turnoff for a tenant. Preventative maintenance on your part can avoid costly problems, so be sure to check for leaks, exterminate regularly for pest control, test smoke and carbon monoxide detectors and change heating and air conditioning filters regularly. If a maintenance problem does arise, respond quickly and correct the problem, or instruct your property manager to do so.
Why You Should Keep your Current Tenant
As a landlord, you may feel that if the current tenant decides to move on, it is no big deal to find a new renter. The fact of the matter is that keeping your current tenant will guarantee that you will not incur vacancy costs that can come about when one tenant moves out and you are still on the lookout for the next one. To find a new tenant, you may incur advertising expenses and/or real estate agent fees. And when you finally find a new tenant, you have to hope that they will live up to your expectations based on your prior positive experiences.
With new renters, you will have to start from square one to instruct the newbies on property rules, the proper routine for paying rent, the procedure for taking care of repairs, maintenance of appliances and a host of other issues. It is often much less of a hassle and more cost-effective to offer an appropriate incentive to your current tenant, keep up with property maintenance and to entice your renters to stay on.