Good tenants repay your investment in them
I’m a big believer in looking ahead and positioning your property for the future. Over the more than 30 years that I’ve been in the real estate industry I’ve seen cycles come and go, as regular as clockwork. Remember 2008? That’s when many landlords came to me for advice because they couldn’t rent up their buildings. It was a tenants’ market – vacancies were high and tenants could afford to be picky.
Currently, it’s a landlords’ market, and some owners question the need to invest in tenant retention. Why worry about it when there’s always another eager renter waiting? But at some point in the future the market will change – it always does. And in the meantime, every time tenants turn over it costs you money: in cleaning fees, advertising, administration and time. Not to mention the uncertainty over whether you’ve chosen a good tenant who will pay on time and be problem-free.
Good tenants repay your investment in them. They settle in long-term, cause few issues, and tend to recommend your building to like-minded people – good tenants create an environment where other good tenants want to live.
So what can you do – beyond your rental rates – to attract and keep good tenants?
Invest in your building so that it’s a pleasant place to live and work
In 2008, while unprepared landlords were scrambling to rent up their properties, landlords who had maintained their buildings to higher levels had fewer problems – their tenants were less likely to make a mass exodus when the market turned.
If you’re a landlord with an older building, you aren’t just competing against other older buildings, you’re also competing with landlords who have purchased condos and are renting them out, and new, purpose-built rentals. These buildings have modern kitchens with up-to-date appliance packages, hardwood floors, in-suite laundry, and may offer extras like blackout blinds in bedrooms.
In addition to your regular maintenance program, think about making thoughtful, long-lasting upgrades that add value to your building and make tenants feel appreciative. Features like new tile around a tub, solid surface countertops, under-cabinet lighting, modern lighting, up-to-date plumbing, and attractive landscaping. You don’t have to make your upgrades all at once; pick one upgrade a year and chip away at it in a 7-year plan. Regularly ask yourself, “What’s the one thing I could do this year to make my building better?”
Consider cooling solutions for your building in the face of climate change
If 2021’s heat dome showed us anything, it’s that coastal living no longer guarantees fresh, cool breezes and moderate temperatures. HVAC companies were flooded with requests from property managers, building owners, and strata organizations looking to retrofit their buildings with cooling systems before the next heat wave hit.
Tenants have indicated that they are willing to pay extra for AC, and most buildings currently in development in Vancouver are incorporating some kind of air conditioning, (starting in 2025, Vancouver will make cooling systems mandatory in new buildings taller than three storeys, or exceeding 6,458 square feet in area). While some older buildings may be able to do a retrofit, others will have to rethink their existing policies around air conditioners. Before it becomes an issue, set a standard for the types of units that may be considered, and how they are installed.
Make your building pet-friendly
In 2017, the Vancouver Park Board estimated that there were about 55,000 dogs in the city and that number has only grown during the pandemic. With pet-friendly rentals hard to come by, a building that accepts pets is a long-term haven for pet owners. Some creative landlords have even added pet washing stations, grooming areas, or waste disposal stations to their buildings.
Offer amenities such as secure, dedicated bike storage
You’re not just competing with the in-suite aesthetics of rental condos and newer, purpose-built rentals, you’re also competing with their amenities.
These buildings may offer concierge service, high-speed internet, party or study rooms, fitness rooms with modern equipment, rooftop terraces and dedicated outdoor BBQ spaces. They may be equipped for car sharing, EV charging, and provide sports equipment and bike storage.
While you can’t suddenly install a rooftop terrace on your older building, you could consider modest upgrades from this list that would distinguish you from other landlords who have invested nothing into their buildings. Do you have unused outdoor space that could be landscaped into a BBQ spot, for example, or space for a secure bike storage area? (FYI: you can charge for the bike storage.)
Provide prompt, responsive service to your tenants
This last point is one of the most basic – yet important – things you can do. Tenants want to feel safe, respected, and comfortable in their homes. When we take over management of an older building that has high tenant turnover or below market rents, the problem is often that the suites haven’t had basic improvements or regular maintenance, and the building exterior is run down. When your tenant makes a service request, prioritize their well-being and tend to it right away. You want them to pay their rent on time, and they want you to take care of issues promptly.
Remain competitive, so that you never have to play catch-up
In good times, it’s tempting for landlords to take all of their profits out of their building, but it’s a short-term gain. If you don’t invest in your building or your tenants, you will suffer a double-whammy when the market turns: you’ll need to upgrade to attract new tenants, and you’ll have less money to do it with due to an increased vacancy rate.
At Transpacific, we’re constantly positioning our clients for the future in a way that’s aligned with their business goals and needs. Curious about what that might look like for you?
Let’s talk – please give us a call at 604-873-8591.
When you make the decision to choose us as your property manager, we understand that you’re placing more than just valuable assets in our hands – you’re placing your trust. Our company was founded on the desire to develop honest, long-term relationships with our clients and work directly with them in a way that makes a difference to their success. Read more about our values