Apartment property managers know the key to maximizing profits is resident retention. "Adding Up The Financial Benefit of Reducing Moveouts" gives an example of an apartment building with 225 units and a 40% turnover rate. This results in 90 move outs a year, 7.5 moves a month. With average expense of $1800 the annual cost is $162,000. A property with an average rental rate of $640 per unit would experience a turnover expense greater than one month's gross rental potential. The expense to turn apartments is about 9% of the gross rental potential.
Properties with lower average rent will experience similar or higher turnover costs. The result is that the percent of revenue required to support this expense will also be higher. Though turnover cannot be eliminated entirely, reducing the rate by one move out a month can make a significant impact: "The property with 40% turnover rate has reduced their turnover by 5%. An annual expense savings of more than TWENTY THOUSAND DOLLARS!"
So how you can use apartment building technology to increase retention rates? Here are three ways that also build a sense of community and add to your list of amenities.
Residents come and go at different times, so they don't always get to meet their neighbors. One way to build community is to create one online that's open only to residents. You get bonus points if you add a TV or monitor in a public space like community meeting rooms or laundry rooms where residents can view the goings-on. Whenever a new resident moves in, invite them to join the online community. Encourage the community to welcome new residents to make them feel right at home.
Some residents may have side hustles where they drive for Uber or Lyft, deliver food or groceries, or offer pet walking services. Others may wish to use those services. You can encourage this by posting services in the online community, social sharing app, and other resources where residents get their information.
The NMHC and Kingsley Associates Renter Preferences Report is based on a survey with more than a quarter million responses from apartment renters. The report lists the top five community amenities, one of which is secure access.
In another survey of 1,000 multi-family renters, Schlage and Wakefield Research has found that 61 percent of Gen Y wants increased security. Apartment property managers can retain more renters with remote video surveillance for a fraction of the cost of security guards. The retention savings will more than cover the apartment building technology.
Stealth Monitoring’s customized security solutions combine video analytics with human intelligence to catch activity while it happens and help prevent damage or theft. Our trained security operators can activate on-site speaker warnings and contact police if they see anything suspicious. This increases the chances of catching the trespassers before they leave the property.
In this video, an individual uses a metal plate to access an apartment parking garage. Our security operator contacted the on-site guard. After being told it would be at least 20 minutes before he could look into it, our operator called the local police, who arrived minutes later.
Many of your residents want social interaction and security. Incorporating apartment building technology such as live video monitoring and an online community will meet those needs. At the same time, it will drive up the retention rate and cut turnover costs.
If you would like more information about live video monitoring and other multi-family residential security solutions that provide your residents with peace of mind, please contact us.