How to Create the Best Rental Experience Possible
The rental property business is looking very bright for 2022. Supply is tight and the economy will recover. And as the last vestiges of the lingering pandemic disappear, renters may look for fresh accommodations whether the current living situation is stale or not.
Renters have been cooped up for about two years, and although they’ve gotten full use of their rental unit, they’re likely exhausted and feel stagnant. It’s an unfortunate happening where they may yearn for a new living experience, perhaps in a new city.
If you’re thinking concessions, discounts, or aggressive leasing action is the way to go, that put you on a downward spiral.
Tenants may decide to stay in the unit if their rental experience can be improved. Getting creative to keep them on lease is wise, and the improvements you make now will generate lasting revenue. Unleash your imagination to improve their renting experience and you can justify a higher rent price to grow your profitability.
Rental Improvement Pros and Cons
- your best tenants more likely to leave in 2022
- improvements raise resale price should you want to sell to capture that equity
- renovation/features upgrades allow you to raise the price and make the home more attractive to renters who will pay above market rent prices
- tenant may not appreciate the upgrades and may not take care of the property
Good Features and Good Communication
There are two sides of the ideal tenant experience for landlords to appreciate more: 1. in demand amenities/features, and 2. courteous landlord relations.
Tenants wants a landlord they can get along with and they want a great living environment. Renting is all about lifestyle.
You’ll find a large list of the most important rental unit/house improvements you can make below. And lets not undervalue the improvement in tenant relations achieved via property management software. When you have demanding tenants and lots of them, a tenant friendly platform with a tenant portal is helpful.
Combined, they make an ideal renter experience. The apartment they’ll live in isn’t the value proposition, it’s the lifestyle enjoyment they feel which keeps them under lease for years.
Big Picture Thinking for Small Biz Landlords
Too many rental industry advisors push weak, temporary improvements for the purpose of raising the rent. And they’re often not the mix of improvements that really inspire their target renters/tenants.
That’s hardly the wisest approach when rent price is a function of how you keep tenants consistently happy. Implementing quality improvements will help you raise the rent each year without complaints.
A great renter experience is a state of comfort, well being, and positivity, and it’s also a reminder to the tenant about their quality of life and how successful they are.
When discontent occurs, they begin thinking of something better.
And renters know they may never own a house of their own, yet they do want to enjoy their rental home as if they owned it.
This Year’s Boom in Rental Housing
Home prices are soaring and may not come down. More properties are being converted or constructed for the rental market. Although institutional property owners see the grand opportunity and are grabbing up as many properties as possible, small property investors might be missing this new sweet spot in the rental business.
If you can’t get the best properties, you can at least optimize what you have to keep your tenants.
The big companies are repositioning and configuring to up the ante on the rental experience. They must believe there’s been a shift in what renters want and will pay more for. In the last year, renters are wanting something different and not the “facsimiles” previously offered.
For instance, many of the new build to rent units are designed to provide tech amenities, liveable backyards with gardens, bigger picture windows, parking spaces, storage, security, HOA services, spacious decks, and spa bathrooms among other features. Consider the benefits those features deliver to real happy, comfortable renters, and how loyal those renters become.
For renters in the US, Canada, Australia and the UK, the market presents a challenge since many are living in places they don’t value. They’re stuck with what they can get, until new rentals appear, and then they terminate their lease when they find a better rental experience.
Price shock is going to be the biggest issue for all renters this year although for many Americans, Brits, Canadians, and Australians, wages will be rising and they’ll demand more from their landlords and property management companies. Given new tenant laws, landlords must make their rentals first class. We’re going to talk more about how to do that today.
Lifestyle is the Benefit They Want
Lets not underestimate how stressed, tired, and depressed renters are during this Covid 19 pandemic. Front line workers for instance are on the edge of serious health breakdowns. They especially want stress and tedious work to disappear at home.
They enjoy bringing in technology to make living trouble free. Automated is a good word to them.
Work from Home is the Ideal
More renters want to work from home in a comfortable environment, with safety for the kids, and with good schools and services nearby. High speed Internet is a must. These are part of the great lifestyle experience. Those landlords who can offer this are going to excel in the years ahead.
And all other renters who will commute to retail, industrial, or service business settings too, still want similar amenities. It’s what everyone expects today. Work from home is a new ideal that represents simplicity, lower costs, more fulfillment and it’s coloring residential lifestyles.
Most of the renters you may be targeting to rent your houses to are lifestyle renters. They’ve abandoned high density, inner city apartments and they’re not eager to return to the multi-family situations. The pandemic has changed their values and lifestyle wants.
There are landlords who’ve asked whether they should upgrade features (lawn in front yard), or to leave it with no maintenance, citing that tenants wouldn’t do the upkeep.
Responses were that the landlord should repair the lawn, plant a few trees, and make it safe and aesthetic for the sake of the neighborhood, neighbors, and the tenants. They actually argued that these items are always part of the budget. But why are they part of the budget?
It might be said if the tenant doesn’t care about their lifestyle experience in the unit, that the wrong tenant was leased. We’ll make the statement that taking care of property and tenants experience is integral to good cash flow and a tenant willing to do maintenance and even pay more for the unit.
To summarize, renters want more and landlords are trying to deliver it in their properties.
What is a Great Tenant Experience?
To create a great tenant experience, simply put yourself in their shoes. Review research on what tenants want. Select the amenities they demand, adopt the tenant service software they will appreciate, inspect and maintain, make renovations, add technology, and make renting as streamlined and trouble-free as possible for them.
Great Renting Experiences in the Vacation Rental Market
Short term rentals will be removing tens of thousands of rental homes from the leasing market. It’s because prices are so lucrative, landlords can earn more. Of course, they’ll need to seriously streamline management to keep it profitable.
Short term renters want to:
- clearly view the property online
- learn about the property owner/management company and see reviews
- sign leases online
- pay safely and securely online
- receive receipts, instructions and communications promptly
- use an online portal where they see their account
- check in, do an inspection for cleanliness and appliance condition, check the Internet connection, pool, hot tub, and receive physical or digital entry keys.
Renters want to collect observations and make a decision about whether they made a good decision. This gets translated to an emotion, and that emotion colors their interactions with you from now on. They rate your honesty, integrity, and worth based on the positive or negative emotion they feel.
If you can engineer their experience so that only positive feelings occur, then you’re going to be a successful landlord in the short or long term lease market. Word gets around to create referrals and future leases.
What Service/Amenities Could make a Difference?
Some features/amenities are very attractive, and they put your rental into an elite zone where other rentals can’t compete. And as renters consider your rental they often forget about their price budget. They’ll want your unit.
Choose upgrades/features that make an emotional impact:
- offer a free inflatable hot tub for the deck (they’re inexpensive ($300 to $600), sturdy and don’t weigh as much as built-in hot tubs)
- new barbecue for the deck ($300)
- free high speed internet ($50 month)
- newly, freshly renovated kitchen, bathroom (pricey, but it may be time for your reno)
- brand new, latest kitchen sinks, countertops, touchless flexible faucets, refrigerator, toilets (small improvements with big impact for liveability)
- new inexpensive, vinyl flooring that looks and feels exactly like wood flooring (fixing squeaky, annoying floor issues)
- make your unit pet friendly (big market of renters with pets who much pay more for a rental now)
- rainshower/massage shower heads (soothing comfort for tired, unappreciated workers)
- soaker tub placed near window (dreamy spa like setting for complete relaxation)
- new larger, energy efficient, street noise blocking windows (brightens rooms, welcomes views of nature)
- new landscaping features such as flower beds, trees, and lawn improvement (add curb appeal and extend living to the outdoors)
- new fence around yard (noise reduction, safety and security)
- new washer/dryer (new, quiet, energy -efficient, improved clothes cleaning technology
- smart security system (whether keypad or RF digital keys, it’s easy for renter)
- all LED lighting inside and décor lighting outside (energy efficient and easier on the eyes)
- spacious open concept layouts (for older homes still cramped with small rooms)
- tankless water heaters (heat water fast, energy efficiently, and never run out)
- friendly, warm, and secure front door (can be pricey but curb appeal is immense)
- more living space (adding a room or adding an addition definitely puts your unit in a better segment)
- large ceiling fans in main rooms and bedrooms (not that costly and just needs property installation)
- add a wood deck (okay, fairly expensive, but in high end rentals, it might be demanded)
- new HVAC system (this summer is forecasted to be a hot one and a good A/C system is vital for many renters)
- shutters on evening sun exposed walls (intense heat can push A/Cs to the limit and make living/sleeping uncomfortable)
Besides all the physical features and amenities you could bestow your valued renters with, there are digital services too.
7 virtual/online services are the rage today. Younger renters, increasingly your renters, demand them:
- virtual showings and tours
- online rent payment
- higher speed Internet service
- online lease management and renewal via platform
- online maintenance requests
- tenant communications portals to enable responsive services/information
- online marketing to create and shape a vision of your property and promote its value/desirability
Modern rental experiences are actively designed and shaped by landlords. With a budget, some great ideas, you can deliver the exceptional service and value renters want. If you deliver one great idea every year, it ensures your price and returns are maximized.
Take a closer look at ManageCasa and how this platform can help you plan, manage and calculate your results. It’s the great landlord experience you’re hoping for, and your tenants will appreciate it too.
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