While a short or month-to-month lease offers flexibility for both renter and landlord, most property owners prefer long-term tenants, and for good reason. Long-term lease agreements save property owners the expense of continually having to market and advertise a property to potential tenants. In addition, having long-term tenants ensures stable and continuous profit for the property owner.
Below are some ways to convert transients and seasonal renters into long-term tenants. The cost of these perks are generally manageable for property owners and should be considered a smart investment in one's landlord business.
1. Offer maintenance freebies
With the cost of rent eating up a significant part of their income, tenants will always welcome a break from paying for necessary household items and services that aren't covered under most leases. Individual landlords and property managers can offer maintenance freebies that are not covered by short-term contracts. These include repainting on the second year of a continued lease while free pest control service can be added in the third year.
2. Create special tenant services
While good property managers are sure to deliver professional tenant services to all, you can boost the service standard a notch higher for long-term tenants. For instance, transients can enjoy a couple of free special services per month if they renew for a longer term. Free dry-clean pickup service or window cleaning are two cost-effective “value-added” that won't cost property owners a lot of money.
3. Reward loyalty with a personal gesture
Show tenants that their loyalty is valued by giving them meaningful treats with a personal touch. A move-in anniversary gift (a small household appliance will do) complete with a thank you card and a handwritten note goes a long way in making tenants feel important. Rather than looking elsewhere, tenants would prefer to stay in a place where they're not just another source of income, but a valued friend.
4. Present an irresistible deal-maker: lower rental rate hike based on length of stay
Rents understandably go up over a period, and tenants often negotiate rental increase. Encourage renters to save a lot of rent money if they opt to stay for the long term. A 0.5% to 1% cut from the previous year’s average rate increase is a manageable deal for most property owners and can be recouped from continuous rental profit. Make sure this offer is clearly laid out in the rental agreement, notably in the lease extension addendum part of the contract.
5. Deliver on your promised perks
While the goal is to convert transients or seasonal renters into long-term tenants, expectations must be clear. As property manager, make sure you don't over-promise on the perks offered once the renter makes a long-term commitment. For instance, if only regular maintenance freebies are feasible, don't promise to spend for all and any damages that may occur. More importantly, be a good landlord. Make sure you are attentive to tenants’ needs and deal with them in a professional manner.
Converting short-term renters into long-term tenants certainly takes time and effort. Apart from enjoying safe, clean, and peaceful living conditions, renters will usually choose to stay longer in a rental unit or community that makes them feel as if they are appreciated.
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