If you have already been through the process of securing new tenants, you'll know the work involved. There is the marketing, the property photography, the screening, and the lease signing.
Once you get a great tenant for your property, it makes sense to try to keep them rather than repeat the process from the start. Here are three tips to help you negotiate lease renewals in Salt Lake City.
1. Allow Plenty of Time for the Renewal Process
It pays to start a lease renewal process early. If you leave it too late, you face the risk of a tenant who has already committed to other plans. So, mark the date in the calendar for the lease renewal and work backward from that.
Allow at least 2-3 months for your negotiations. That will give you enough time for some of the lengthier parts of a lease renewal strategy, such as investing in maintenance and repair work on your property.
However, there is something to keep in mind about early negotiations: the market may change between now and when the lease expires. So, avoid agreeing on prices until later in the process if there is a sudden market change.
2. Consider Offering Incentives
In a buoyant real estate market, your tenant may have plenty of property choices. So, how will you make your offering better than the ones they can find elsewhere?
If you can answer that question, it will help you secure that tenant lease extension. Here are some ideas:
- Offer a rent freeze
- Provide a budget to upgrade parts of the property
- Invest in revamping the interior
- Offer some extras, like free parking
- A discount on the first month's rent
- More flexible lease terms, like one month's notice
- Allow pets
All these show the tenant that you value them, thereby helping to cement your relationship with lots of goodwill. That's important for your long-term approach to lease management, especially when you have been lucky enough to find a reliable and trustworthy tenant.
3. Prioritize Communication
Lease negotiations don't happen overnight, and between starting a lease renewal conversation and finalizing it, there will be many conversations in between.
Think about how to keep the conversation flowing and maintain a positive relationship with your tenant at all times by:
- Being transparent about your lease position
- Being flexible and open to compromise
- Being available to talk things through
The last one is crucial. It's easy for momentum to slip in a rental contract renewal. If you haven't heard from your tenant about a decision, get in contact. Likewise, if the tenant comes to you with questions, respond to them quickly.
Always have your phone available and give your tenants an email address they can contact. If you go away on vacation, give them a contact point in your absence.
Lease Renewals: Securing the Best Tenants
Lease renewals are a vital strategy for any successful real estate investor. A long-term reliable tenant is far more valuable than a string of not-to-dependable ones.
At Envy Property Management, we take an investor-led approach to real estate. We prioritize relationships and help our clients maximize their property investments. Learn more about our services in Utah.
