The goal of offering an effective resident renewal giveaway is to incentivize the resident to renew their lease, not to make capital improvements that enhance the property. I know that owners would love to accomplish both… but the reality is new mini blinds, a new paint job, carpet cleaning or ceiling fans just don’t cut it.
If a resident is thinking about moving out, you need to give them a real good reason to stay one more year. If not, they’ll be looking for another property, and once they find it, and probably with some kind of concession, they won’t be renewing
Incentives like 1 month free, rent reductions, cash, or cruise incentives work much better than improvements because residents perceive a value for their benefit. The real concern is the cost.
If you are thinking how can you offer a renewal incentive with the highest perceived value at a great cost to the property, there is no better value than offering a 5 Day Cruise Incentive booked on Carnival, with a $1798 value, for around $159 per certificate! Free color marketing materials are included too! Check out www.AIMcruise.com about their cruise certificates.
Remember that according to an NAA report last year, the average turnover expense is around $4000 per unit.
That is probably high for some markets, but the reality is, in ALL markets, that it costs LESS to keep an existing resident than to find a new one!
Reprint from Multifamily Insiders .com
P. S. from Lester Langdon – this concept will also apply to office building and retail strip center tenants.