Let’s face it, empty units eat away at your profits. So how can you keep your properties full… and have a waiting list overflowing with prospective tenants? Simply by establishing a resident referral program.
No more flyers! The thought of a referral drive may evoke visions of papering your properties with flyers. But don’t revert to old school ways, because this isn’t the most effective way to drive traffic to your door. Instead, utilize Rent Manager’s Letter Writer function and efficiently notify every resident about your recommendation program by sending one simple email. In addition to being easier and less expensive, going paperless is roughly three times more effective than using traditional printed flyers.
Don’t forget about social media either! If your property has a blog or a Facebook/Twitter page, use them to promote your referral program as well.
So what kind of incentives can you offer?
Gift it. Gift cards are one option. Offer a gift card for a small amount ($20 or $25) for each endorsement that results in a showing. Then give a gift card for a larger amount (such as $100 or $200) for every referral that actually signs a lease. Gift cards to home improvement stores are great because your renter will likely use it on something to make your property feel more like home.
Take it off! You can also offer a percentage discount off their next month’s rent… anywhere from 10% to 50% is common. Whether you incentivize with gift cards or discount the rent, a good rule of thumb is to include a 90-day residency requirement. In other words, after the prospect occupies the property for 90 days, then the tenant who referred them will receive their incentive payment.
Renew it. There’s a definite financial benefit to holding on to good tenants. Turnover can be expensive’costing as much as five times more to re-rent a unit than simply renewing a lease. So retaining your renters for a long period is worth the small cost you might spend to keep them happy.
Consider giving your residents their choice from a menu of upgrades if they renew their lease. Choices can include having a ceiling fan, microwave range, or a new kitchen backsplash installed. Or you can offer to paint a room of their choice or to clean the carpets.
Also, calling it an anniversary instead of a renewal can put a fun spin on it. Giving an anniversary gift can go a long way towards having tenants who want to stay with you long term. Plus these incentives will add to your property’s value’so it’s a win-win all around!
If you already have a good resident base, chances are that you’ll have a fountain of solid referrals once you create a recommendation program. Think of your current tenants as property ambassadors. Treat them right, make them feel like they’re getting a good value, and they’ll be more than happy to tell all their friends about you.