Leveraging Resident Feedback to Enhance NOI
Can net operating income be significantly improved with good customer service? Property managers and owners explored that compelling topic last week at the National Apartment Association’s Apartmentalize conference in Denver.
Last week’s Apartmentalize conference hosted by the National Apartment Association in Denver brought together property managers and owners from all over the industry. Brian Ericson of Cortland, Melanie O’Brien of GID/Windsor Property Management Co., Catherine Jacobson of Avenue 5 and Tim Griffin of Kingsley Associates shared their experiences in a session titled “NOI-Enhancing Nuggets”.
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There is a great deal to be learned from resident satisfaction surveys. While it is obvious that happy residents are more likely to renew than unhappy residents, it is useful to understand what is driving renter attitudes. The session examined several interesting statistics demonstrating that NOI can be improved significantly with good customer service.
Resident satisfaction begins before a lease is even signed. The likelihood of a touring visitor of leasing goes up dramatically the more positive their experience is. What that means is that better tour experiences directly result in faster occupancy.
The panel repeatedly stressed the importance of initial impressions. Nowadays most renters will begin their apartment search online. It is important for the community to maintain the same feeling in person as with their online presence.
Happy Residents, Better Renewal Rates
Another interesting insight was that a resident’s decision to renew begins as early as their move-in day. Residents who were satisfied with their move-in experience remained satisfied 83% of the time when it was time for their renewal. Conversely, of the residents who were unsatisfied with their move-in experience only 27% became satisfied by the time they were up for renewal. The leading factor in move-in satisfaction was maintenance issues upon move-in. When there were no issues present 77% of new residents rated their move-in as excellent. Satisfaction remained high if the issues were fixed within 7 days and dropped considerably when they were not. Satisfaction scores increased by 28% when follow-up calls were made by the community team after move-in. The panel reasoned that perfect units on move-in and good communication with residents directly translated to better renewal rates.
After the resident has moved in satisfaction rates remained high when non-emergency maintenance requests were handled within 24 hours. About 79% of residents remained satisfied if their request was handled in under 24 hours while only 48% remained satisfied if it took longer. The residents whose maintenance requests were handled quickly renewed 67% of the time compared to 60% for those who waited longer.
Overall the link between resident satisfaction and renewals is crystal clear. NOI can be increased by keeping residents happy, and this can be achieved inexpensively by paying attention to details. The panel recommends having a pre-move-in checklist, responding quickly to non-emergency maintenance requests and following up with residents after every point of contact.