Reduce Resident Turnover by Gerry G. Banks

Make a Dedicated Team Effort to Reduce Resident Turnover

We have over 23 apartment communities in seven states in our portfolio, including approximately 12 in one metro area. In that metro area, turnover traditionally runs approximately 70% in class B product and our experience was in line with the metro averages. We analyzed that our greatest opportunity to increase portfolio returns was to reduce resident turnover. We estimated that each turnover costs us approximately $2,000. plus. This is a combination of down time, utilities, labor, apartment preparation costs, marketing, and more.

Solution: We decided to dedicate a full time team to the number one goal of reduction of turnover in our major metro area. We identified our best two leasing agents in our portfolio and moved them to a centrally located, separated office in the clubhouse of one our properties. We gave them the assignment of tracking lease renewals by property, month, and floor plan, and the goal of working with each properties staff to reduce turnover and to be pro-active in lease renewals. We utilize the software “Rent Roll” for on site lease management. Using the F-148 report which details month by month and floor plan by floor plan lease expirations they review each properties lease expirations in the upcoming months and establish goals, plans, and ideas for each property. As an example, if they see a particular property has a large number of leases expiring three months from now, they will go in and analyze those leases and see which leases are closest to market rent. They, or property staff, then use various materials to contact those particular residents with a small incentive to renew now, with no increase to some month where we have less potential turnover. They design, coordinate and attend lease renewal parties. They track each properties progress on lease renewal follow up, making sure that each resident is being contacted well in advance, and follow up is made. They have designed and implemented contests between the properties with an emphasis on renewals.

The Results: As of the end of the Third Quarter our turnovers have dropped by approximately 7% from last year. Turnovers through the third quarter are 172 units less than for the same period last year. We are also seeing the workload of staff flattened out by managing expiration dates better and a resulting reduction in overtime. Further, now that the program is really rolling and in place we are optimistic we will be able to improve upon those numbers in the quarters ahead.
Contributed by: Jerry G. Banks
Apartment Management, Multifamily Brainstorming Sessions, Resident retention