Providing Good Customer Service Is Critical To Retaining Tenants

Originally published in LPMA’s Newsletter, June 2012

Many landlords pull out all the stops to attract new tenants through rental incentives, such as one month’s free rent.  In many cases, however, they stop actively working at the relationship once tenants move in – and that’s a mistake, according to one marketing expert.

Bonnie Hoy, a Toronto-based rental consultant, believes good customer service is at the heart of retaining tenants.  If tenants aren’t happy from the beginning of their tenancy, they will never be happy while they’re living in their building.

“It’s important to make sure that you’re over-the-top friendly on their way in the door,” says Hoy.  “If you can make people happy at your properties, you have a much better chance of keeping them long-term.”

Working at retaining tenants pays off for landlords.  Turnover costs, including lost rent from an empty unit, the time required to advertise for a new tenant, and even cleaning a unit, are high.

“It never looks good to have a revolving door, so it affects the other tenants after awhile,” Hoy says.  “From a work perspective, showing apartments, running credit ratings, doing move-in inspections, it’s all labour.  You’re better off dealing with a resident you know as opposed to one you don’t know.”

Many property management companies have Facebook pages where residents in a building or a complex are given a voice and can connect with one another.  Electronic newsletters also help to reinforce the sense of community.  “It just keeps people in the loop and in touch,” Hoy says.

Hoy recommends that landlords take the time to meet with tenants face to face through resident appreciation events, such as coffee get-togethers and barbecues.  They should also acknowledge life-changing events in residents’ lives, such as a wedding or the death of a spouse, with a card.

Overall, it’s important to say thank you and to make customers feel valued.  “As an industry we forgot that they (tenants) are actually our customers,” Hoy says.  “They may be paying the rent and be obligated by the way of the lease, but a resident is still a customer.  We don’t even call anybody ‘tenants’ anymore – they’re all residents.”

Blair Spencer, director of customer experience at Minto at Cherryhill Village, says staff work at personalizing their relationship with tenants in a variety of ways.  Members of the management team are required to call three residents every week to introduce themselves and see how they’re enjoying life at Cherryhill.

Staff back up promises with action and respond to maintenance requests within 48 hours; Spencer says 80 per cent of requests are completed within 24 hours.  When service requests are completed, the company asks residents to provide feedback.

“A lot of landlords are only reminded of customers when a rent increase (letter) goes out, whereas we focus on it as an overall tenant retention strategy,” Spencer says.

Minto measures customer satisfaction in a third-party annual survey by J.D. Power and Associates, as well as monthly in-house surveys that allow Minto to track the areas where residents believe they’re doing a good job and areas that need work.

“It gives us the opportunity to react quickly versus a year later,” Spencer says. “It also helps us to track service trends, what we’re offering and what residents want to see; they feel that they have a voice.  We also do that through the residents’ association meetings where we meet with representatives from each building on a quarterly basis.”

Spencer says staff view residing at Cherryhill as a community living experience as opposed to living in a rental development.  In May, several events were held, including a hat-making workshop, that coincided with Queen Elizabeth’s Diamond Jubilee celebrations.  To celebrate Mother’s Day, Minto gave residents the opportunity to have employees perform tasks, such as installing a curtain rod, that they normally don’t do.

Spencer advises small landlords to work at building a professional relationship with their tenants.  “At a minimum, they should be contacting residents once quarterly and just making sure that everything is okay, as well as doing their unit inspections.  Every unit should be inspected at least once a year.”  Landlords can also take care of small problems, such as dripping taps, particularly since some tenants feel reticent about contacting their landlord over minor issues.

Spencer says small landlords can make new tenants feel appreciated by giving them a welcome basket filled with the things they may need on move-in day, but might not have, such as coffee and coffee mugs, as well as a map of the city that also indicates bus routes.

All of those gestures speak volumes to tenants.

“It’s a very tight market (in London, Ontario) and it’s very price competitive,” Spencer says.  “You have to not only stand behind your service, but you need to keep improving your services as you grow and to stay one step ahead of your competitors.  We’re all fighting for that rental dollar.”

Hoy says landlords have increased their tenant retention strategies in the last three to five years because the market, particularly in London, is so competitive.  Tenants can afford to pick and choose because “there’s a lot of product available, a lot of options for people,” Hoy notes.  “If they’re not happy, the barriers to moving are low.  As a result, landlords have been forced to be more responsive.”

She says some companies are masters at retaining tenants and some “not at all.”  Communication is paramount.  “The better you communicate with people, the better the chance you have of keeping people happy.  I never believe in the philosophy that ‘less is more.’ More is always more.”