Every business finds its true success in working with people. From retail sales to manufacturing you must deal with people as employees and as customers. Being a property owner is no different. You can save money with free rental agreements and find the right people with good tenant screening, but your interpersonal skills are vital. Your first step in being a successful owner is to recognize the part that people play in your business and learn to deal with people effectively. If you only had to deal with the building, and the upkeep related to it, property ownership would be easy and everyone would want to do it. There is more to successful management than dealing with leaky plumbing and record keeping. Even if your tenant aces the tenant screening process, your relationship can still be volatile if you’re not a personable landlord who is fair and trustworthy.
The foundation of every business is its customers and in the property ownership business your customers are your residents. The eighties began the era of customer satisfaction and it applies to our business also. The benefits of customer service are numerous, but first on the list is the lack of overhead costs and stress in needing to constantly replace residents. Keep in mind that you may not be able to replace especially good residents with those equally as good. Additionally, dealing with resident turnover can be costly. National surveys estimate that an owner can lose approximately two months’ rent every time a resident moves out. This amount is based on the possibilities of losing money from cleaning and redecorating for new residents; advertising expenses; processing paperwork; damage to common area walls, doors, halls and so on by movers; time spent showing vacant apartments; lost income from vacant apartments and commissions to apartment referral services.
As an owner you won’t be able to eliminate turnover completely, but you can minimize it by maintaining a good relationship with your residents. Here is a checklist on developing strong resident relationships and keeping your residents satisfied:
- Show interest in them and their needs during the rental interview.
- Follow through on your promises about repairs and decorating. Don’t offer something you can’t deliver.
- Give residents your work and cell phone number or other numbers to use in case of emergencies. Provide them with a list of other important phone numbers for emergency repairs or services.
- Respond promptly to requests for service. Even if you can’t meet their demands, let them know where you stand on the issue. Communication is the key to maintaining good relationships.
- Let the residents know in advance what you expect from them and what they can expect from you on such items as rent payment, lease provisions, pets, complaints, services and so on.
- Respect their privacy and right to peaceful possession of their home during their lease period. (Peaceful possession is a legal term that means the right to use the premises without harassment or interruption.)
- If you must enter an apartment when the residents are not at home, and without prior notice, leave a note stating that you were there and why. In general, do not enter a resident’s apartment without giving at least 24 hours’ notice.
From the moment you meet prospective residents until the day you refund their security deposit upon termination of the lease, you are faced with maintaining good resident relations. The kind of relationship you develop with your residents can dictate how much peace of mind and profit you derive from your investment property.
Your first meeting with a prospective resident is crucial to the success of the owner-resident relationship. You want the resident to respect you and the property, while keeping your relationship on a strict business level. The image you want to project is one of a professional property owner who is congenial, friendly and welcoming. Above all, you want to maintain control of the relationship at all times.
Some of the more prominent problems between owners and residents are communication problems. When the communication is with a problem resident it is especially important to keep it on a strictly professional business level. No need to be aloof or to appear cold hearted but do not let your sympathy interfere with your common sense or sound judgment. As we mentioned earlier owners have been labeled as the scoundrel throughout history. Please do not give your resident a reason to believe the stereotype holds true.
It is only natural to be proud, and therefore protective, of your property. You are correct in requiring your residents to treat it with respect. The best way to do this is to set a positive example. Keep your property well maintained and create a positive image in the resident’s mind from the very first day they inquire about the property. It is not only permissible to let the new resident know how you feel about your property, but encouraged. Present the unit as their home and help them to feel it is truly in their best interest to take care of the property as if it were their own.
Remember that residents pay rent that in effect pay for your asset. Without them you wouldn’t have a business and the benefits, both short and long-term, that accompany it.
