The Power of Resident Loyalty: Top 9 Strategies for Building Communities That Residents Love to Call Home

One truth stands out in the ever-evolving landscape of multifamily housing: happy residents are the cornerstone of thriving communities. That’s because resident satisfaction isn’t just good for your residents — it’s also great for your business.

The 2024 Renter Preferences Survey, conducted by the National Multifamily Housing Council (NMHC) and Grace Hill, reveals a stunning statistic: a whopping 85% of residents either agreed or strongly agreed with the statement, “I enjoy living in my community.”¹ These happy residents stay longer, build word-of-mouth buzz, post favorably on review sites and social media, increase referrals, and act as brand ambassadors promoting your properties.

This blog post will explore the impact of resident loyalty and will also share how to craft experiences that cement loyalty with your residents.

The Financial Impact of Empty Units

Property operators face a daunting financial challenge in today’s highly competitive rental market. The potential cost of a vacant apartment home ranges from $1,000 to a staggering $5,000. The financial loss includes:

1. Cleaning Costs: Every departing resident leaves a unit requiring thorough cleaning.
2. Repair Bills: Getting a unit ready for new residents can be a significant expense, from minor touch-ups to major overhauls.
3. Utility Drain: Empty units still rack up utility bills, eating into your bottom line.
4. Lost Rental Income: Every day a unit sits vacant is a day of lost revenue.
5. Advertising/Marketing Fees: Reaching potential new residents requires investment in multiple marketing channels.

Translating Brand Awareness into Resident Retention

Leading multifamily operators recognize that brand awareness and loyalty translate into long-term resident occupancy.

Greystar, the largest apartment owner in the country with 108,000 managed units, focuses on building its brand as a path to building loyalty. “Developing a strong, recognizable brand can foster a sense of trust and loyalty among residents,” Scott Berka, Senior Managing Director of Brand and Customer Experience at Greystar, explains. “We aim to create a brand that residents immediately recognize and associate with positive experiences.”²

Another innovation that Greystar offers, by virtue of its scale, is the ability to transfer leases for residents effortlessly. Residents can select a new unit within the same community or even in a different state without completing a new application!

Harnessing AI and Data to Address Issues Quickly and Proactively

Cortland, a top 10 multifamily unit owner, employs AI to scan emails quickly to determine common issues. Combining AI with other data points, such as focus groups and reviews, allows the company to become proactive rather than reactive in addressing problems. Mike Gomes, Chief Experience Officer at Cortland, says: “We’ve embedded within [a single platform] all communications—text, email, phone—allowing us to serve the customer faster and more personalized.”³ The significant benefit is that residents who receive responses within 24 hours are nearly 30% more likely to renew.

Residents Demand Safety and Security

According to a 2024 National Business Research Institute (NBRI) survey of apartment residents, two of the top four factors driving resident satisfaction are amenities and enhanced security measures.⁴ A substantial 69% of residents further emphasize the importance of parcel security, highlighting the growing significance of this feature in multi-residential communities.

The NBRI survey also saw smart lockers, an amenity that ensures community safety and security, solidify their position as a top amenity for residents for the second consecutive year. The preference for parcel lockers is underscored by 78% of respondents ranking them as their preferred package delivery method. This amenity stands out for its universal appeal and frequent use, with nearly 90% of residents utilizing lockers in their buildings– 73% of residents are receiving 1-3 deliveries weekly. In contrast, other amenities such as EV charging stations, resident activities, and dog parks have declined in popularity.

It should come as no surprise, then, that smart lockers can increase lease renewals by up to 40%. Given the continued growth of online shopping and deliveries, the convenience and security they afford is a significant motivator of resident satisfaction.

Recognize and Retain: 9 Effective Strategies to Reward Resident Loyalty

Here are nine strategies that reward loyalty to retain residents.

1. Cash Rewards

Cash remains the most attractive reward. 52% of residents prefer cash or spendable incentives.⁵

2. Temporary Rent Reduction

Limited-time discounts, typically for three months, are effective. The 26-35 age group is most responsive to this incentive.

3. Parking Perks

Depending on the location, free, discounted, or covered parking can be a valuable incentive.

4. Complimentary Cleaning Service

With hybrid work models, offering a one-time deep clean or limited-time cleaning service is appealing.

5. Subscription Gift Boxes

Capitalize on the booming subscription market by offering boxes tailored to resident interests (e.g., food, meal kits, razors, coffee, make-up).

6. Renewal Menu

Provide various options including upgrades, gift certificates, or event tickets, allowing residents to choose their preferred incentive.

7. Bundled Internet & TV Discounts

Pass on corporate discounts to residents for these essential services.

8. Resident Referral Program

Implement an easy-to-understand rewards system for quality resident referrals, offering cash or gift cards.

9. Flexible Lease Terms

78% of residents would stay if offered shorter renewal periods without increased payments.⁶

Implementing a mix of these strategies can significantly boost resident satisfaction and loyalty. The key is to offer a diverse range of incentives that cater to different preferences and needs. By investing in high-impact amenities like smart lockers, delivering a seamless living experience, and offering tangible rewards, property managers can create a community that residents are reluctant to leave.

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Want to learn more about how our smart locker solutions can support your resident retention goals? Speak to a Parcel Pending by Quadient representative today.

Sources:

1. National Multifamily Housing Council, Grace Hill. 2024 NMHC and Grace Hill Renter Preferences Survey Report. www.nmhc.org. November 7, 2023. https://www.nmhc.org/research-insight/research-report/nmhc-grace-hill-renter-preferences-survey-report/
2. Multifamily Executive. How Branding and Data are Shaping the Resident Experiences. www.multifamilyexecutive.com. July 1, 2024. https://www.multifamilyexecutive.com/property-management/resident-life/how-branding-and-data-are-shaping-the-resident-experiences_o
3. Ibid.
4. Parcel Pending by Quadient. 2024 Resident Preferences Report. www.parcelpending.com. August 2, 2024. https://www.parcelpending.com/en-us/resources/2024-resident-preferences-report/
5. Zillow. 5 Budget-Friendly Resident Renewal Incentives. www.zillow.com. n.d. https://www.zillow.com/multifamily-knowledge-center/property-management/five-resident-renewal-incentives/
6. Serlin, Christine. Assurant Study Looks at Renters’ Changing Priorities. www.multifamilyexecutive.com. April 16, 2021. https://www.multifamilyexecutive.com/property-management/apartment-trends/assurant-study-looks-at-renters-changing-priorities_o