Renewals are more important than ever during COVID. Keeping customers you have and achieving the right renewal price is crucial. But do you know who will renew? Or do you find out too late?
Lease renewals are often talked about as historic averages. Let's say fifty percent is the historic average and maybe we also know historic lease trade out. A good benchmark, but this is an aggregate and doesn’t give us insight into a specific resident. Perhaps resident satisfaction can be a good indicator. However, resident satisfaction can not predict life events — a job change, baby on the way, or financial challenges — that often have an outsized influence on if a resident will renew.
To make matters worse, residents have little reason to share if they intend to renew.
They may already be looking at other properties, seeing incentives that will influence their decision. Then, it’s too late. They let you know right at the legally required time. A scramble starts to fill the vacancy let alone replace the lease at the desire trade out.
Renewal intent can help. Renewal intent tells you if a specific resident is likely to renew based on three factors:
Resident communicates directly with you, and they tell you early.
Resident life events. A resident just got a new job. But that job isn’t near their current home. That’s a good indication that a renewal isn’t in the cards. Baby on the way? Good indication the resident is looking for more space, but staying put. Promotion at work? Staying right here. Maybe the resident is ready for that larger apartment. Life events are the best implict indicator of renewal intent.
Resident saving and spending habits. Examples: just bought and hung a new TV in the home. Saving money every month. Paid off student debt. Opened up college savings account for the kids.
Property managers only know these things anecdotally. Even if they are very close with their residents (trust), there are no consistent data (engagement) that can interpret these indicators (A.I.).
Here is how Stake helps property mangers understand renewal intent:
Trust: Rewarding residents builds trust. But more than just a coupon, Stake builds financial wellness as Stake members save more each month. Helping residents where it matters most, their financial future, we build a unique, trusted relationship. Trust means they are more likely to indicate if they will renew.
Engagement: Those conversations are sometimes explicit, such as a tenant telling us they are going to move, or stay. But they also share implicit information such as life events. In fact, 80% of Stake members communicate with us more than once a month about their financial plans, home searches, deals they are looking for, and life events.
A.I.: All of this adds more data to understand how to meet their needs, and our Rewards A.I. builds predictive models to be more specific about renewal intent.
This is how major loyalty platforms work: to build a data set from customer engagement and create personal, specific, offers to keep customers longer and more profitably.
Even knowing early that a resident isn't renewing is helpful. Now you can list earlier, and fill the property faster.