(#243) FOUNDATIONAL GUIDE: RENEWALS

Easy renewal conversations starts from the first day a person becomes a resident. Too many times communities have little interaction with residents throughout the lease process and are surprised to get a notice to vacate from a resident.

Our rate of renewals is really a reflection of the sum of all our interactions with that resident.

Renewal conversations are never easy, but major rent increases pose an extra challenge to onsite professionals. According to the latest reports in June 2022, rent growth is accelerating and is up 15.3% year-over-year from 2021.

It’s easy to feel apprehensive about these conversations, but avoid walking into those conversations with a negative disposition. In the following pages, we want to give you the tips and tools you need that lead to more positive renewal conversations.

It's important to remember that any upset or frustrated residents are not a reflection of your worth. You can only focus on what you can control, which leads to our 5 tips for having difficult renewal conversations…

For a deeper dive, check out our guest educator, Jackie Ramstedt, in “Dear Resident! We Love You So Much We’re Raising Your Rent!”

PREPARING YOUR TEAM

Help every team member be ready for a renewal conversation
by prepping in advance.

Discuss why price increases are necessary for the financial health of your community.
Get familiar with current market rates and competitor pricing and incentives.
List out any improvements that have been made to the community in the last year.
Familiarize yourself with the current cost of moving in your area. Include costs that aren’t just monetary. For example, if your prospect has children, will they be leaving behind a school district they know and love?
Review where and why you’ve lost past renewals. For example, if there is a trend in home purchasing, get comfortable talking about the perks of renting over buying. If you see you are losing to a certain competitor, find out why.
Practice having those conversations as a team. If you are the community manager, consider letting each team member individually sit in as you handle a renewal conversation. When it’s your employees turn, sit in with them and offer valuable feedback. Remember to highlight what went well!
In your weekly team meeting, discuss how the previous week went in terms of renewal conversations. What challenges were difficult to overcome? What could be done better?
Have a little fun and watch our Friendly Renewal Conversations Q & A! We are warning you… it’s an oldie, but a goodie!

An informed team is a team that can confidently tackle renewal conversations.

A NOT-SO-CORPORATE APPROACH

If you’ve been in the habit of printing out your typical “corporate” renewal, you may want to hit pause, especially if that renewal letter includes an increase.

Asking people to pay more money (without an obvious value increase) deserves more of
a personal approach.

Remember, your residents are people too! If they’ve had an awful day (late for work, stuck in traffic, obnoxious boss, cranky kids) and then they come home to a renewal notice stuffed in their door WITH A PRICE INCREASE, it’s not going to be well-received.

So start by putting yourself in your resident’s shoes, so to speak!

12-month resident retention strategy

Now that you’ve put yourself in your residents’ shoes, you can now start planning your retention strategy. This starts the day they move into your community.

At Sprout, we like to compare retention efforts to a jar filled with candy. As you create positive experiences with your residents, you add a piece of candy to the jar. The more touchpoints you have, the fuller the jar.

The communities that have a full jar of positive experiences won't have to try as hard when it comes to proving value when an issue comes up.

Every month you should be having a meaningful touchpoint with your residents to help build that relationship. Take a few ideas from our handout and start planning your path to more renewals.