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5 simple ways to increase resident retention
Every property manager knows that retaining great residents equates to money earned. With occupancy at an all-time high and affordable housing at an all-time low, resident retention may not be a top priority. Savvy properties are reallocating the time they used to fill vacancies to strengthen their retention strategies. Here’s what they’re doing to differentiate.
1. Increase transparency around security deposits
Any lasting relationship–business or personal—is built on trust and transparency. As a property, the easiest way to show authenticity and transparency with residents is how you communicate with them. Sounds simple? Maybe.
For example, according to one Roost survey, more than 50% of respondents reported that deposit refund terms were not well communicated. Because the refund process is typically a black box, many residents are left wondering how much money they’ll get back, what charges they might be responsible for, and when the money will arrive.
You can improve transparency into this process to help improve resident retention. Look for tools, services, and apps that provide residents with status updates and details throughout the move-out process. Like Roost’s resident app, some also offer tips and resources to help residents understand how to maximize their refund.
2. Ease the burden of move-in costs
Moving is a strain for even the most intentional budgeter. This is because the expenses can far exceed a resident’s monthly cash flow. Your property can help ease this load by providing flexible move-in options including:
- How they pay – Offer a range of payment methods, including some that don’t charge the resident for the payment. Think Paypal, Venmo, ACH/checking.
- Who pays – Give roommates the option to pay just their share directly. Roommate splits empower residents to pay at a time that best fits their monthly finances.
- When they pay – Provide residents the option of paying in installments over the course of three months.
Providing flexible move-in payment options is a true benefit to your residents, but in many jurisdictions, it’s also becoming a requirement. In King County, Washington, new residents must be allowed to pay their security deposit over the course of six months. In Portland, Oregon, properties must all allow residents to pay conditional security deposit amounts in three months.
3. Connect residents to a financial safety net
According to the Financial Health Network, only 28% of Americans are considered financially “healthy”. That means the majority of your residents will struggle at some point during their lease. Why?
Rising student debt, medical costs, and living expenses can impact the financial health of even the best budgeters. Many renters struggle to build enough savings to cover an emergency or large bill and turn to high-interest credit sources for help. (Read more on why here.) This can cause a vicious debt cycle that creates financial instability and housing instability, too.
While helping residents improve their financial health isn’t necessarily your job, it does represent an opportunity for your property to differentiate itself and strengthen resident retention. Look for partners that can provide your residents with fair financial amenities–like cash flow smoothing, credit building, and negotiated deals and savings.
4. Adopt modern and flexible payment methods
Americans rely on digital technologies to live their lives. They shop, pay, book travel, and socialize digitally. And as the millennial and GenZ renter segment grows, accepting money orders or credit and debit cards is no longer good enough.
If you don’t already, look for ways to expand your payment options—and make sure that extends to how you issue refunds, too. Consider this: Most properties issue a single check, by mail, to residents following move out. This puts extra stress and strain on roommates who aren’t necessarily moving into their next place together. They have to track down the check, cash it, debate who gets what, and issue payment to each other, perhaps from opposite parts of the country.
A deposit automation platform can quickly issue each roommate their refund share directly into their checking account. So, rather than making the security deposit refund process the final straw for residents, you can make it a smooth, pleasant one. When people have been treated exceptionally well by a business, they like to talk about it.
5. Leverage tech to streamline security deposit processes
Streamlining an existing process can have triple value—it can cut costs, reduce risk, and create space for more meaningful interactions with residents. And because security deposits are so labor-intensive, the process is ripe for improvement.
Deposit automation simply streamlines existing workflows to remove the manual lift, payment collection, notifications, and tracking. Onsite teams no longer have to trek back and forth to the bank to make deposits or coordinate refunds with accounting. Instead, they can put more effort into proactively checking on residents and units and creating a better, more review-worthy experience throughout each lease.
6. You don’t have to invest much to improve resident retention
With occupancy rates so high, now is an excellent time to strengthen your property’s position in the market. Identifying tools and apps that can streamline existing workflows and better meet modern resident expectations will help you reduce disputes, hang onto great residents, and differentiate your community for years to come.
Interested to learn more about deposit automation? Contact us.
Roost is a mission-driven tech company focused on improving property NOI and renter financial health. Roost’s free platform helps large multifamily automate the deposit intake and refund process, reduce compliance risk, and minimize disputes. It also helps renters avoid late fees and build credit history by providing renting guidance, financial tips, and savings deals, and a simple way to turn their refundable deposits into an instant emergency fund.