Tenants Say No
When you have an apartment vacancy, every application is an opportunity. You go through your screening process, get back to your prospective tenants, invite them for a tour, and for some reason they turn down the lease. What goes wrong between the application and the decline? To take control of your turnover process, the best answer is to tackle the leading reasons why tenants say no to a good apartment.
Every apartment brand and leasing agency can perfect their tenant conversion strategy, from understanding your tenant motives to making your units more competitive in the local market.
1. The Applicant’s Plans Change
The number one reason why tenants who apply back out of a lease is that plans change. A new job may fall through, or their move date may change by several months. Maybe they suddenly have another relative to move with or a pet that needs a pet-friendly apartment. Moves are among the most volatile periods in anyone’s life, and most people want to get an apartment secured well before the truck arrives. Often, the best a tenant can do in their situation is politely let you know that their circumstances have changed.
This means they apply before plans change, sometimes even making it most of the way to closing a lease. There’s nothing you can do about plan changes except streamline lease-signing instead of reserving – a strategy that may or may not be right for your brand.
2. The Apartment is Not Locally Competitive
The next most common reason that an apartment is turned down is that it’s not competitive. Most people apply to several apartments in the area and go through the application process, then the first or best to approve wins their lease. When they close on the best option, the other lease agencies get the decline. Therefore, apartments that take too long for approvals and those that are less competitive in features, price, size, or beauty will see more rejections.
Any way that your apartments are not competitive might be the cause of lease rejections and applicants backing out. By examining the market, you can use this insight to increase the desirability or competitive value of your apartments and win tenants as their best application-approved option.
3. Poor Expectations Management
Some prospective apartment tenants will turn around if their expectations aren’t met, even if the apartments are beautiful and competitive. For example, photos angled to make an apartment look spacious can lead to disappointment when applicants arrive for a live tour. If they were counting on a certain amount of space (most people don’t ‘read’ square feet into real space mentally) then any unmatching expectations can result in a disappointment drop. In other words, instead of loving the place, they experience unhappiness during the tour.
Another common mistake that is specific to apartments is using one photo walkthrough for all units of the same layout – if they do not match very closely in features and quality. If your units vary, make sure to manage expectations for individual units.
4. Discoloration – Anywhere
Beyond the top three, the next most likely turn-off for potential tenants is discoloration and old-looking fixtures. There are so many things that modern residents should be careful about; mold in the walls and carpets, lead or leaks in the pipes, or short circuits in the light fixtures. The single most common indicator that a home has one of these dangerous features (even if it doesn’t) is discoloration. Both water damage and resulting mold cause splotchy walls, carpets, and especially the seams and corners of the house. Leaky pipes tend to be discolored and corroded. Discolored ceilings can mean scorch or water-damaged wires. Even if it doesn’t.
Many cautious renters and those with high expectations will turn down an apartment where they can spot any worrying discoloration.
5. Outdated Fixtures and Appliances
After the big disqualifier are the more mundane reasons why tenants pass on a lease. Even if they have gone through the entire application process, some change their minds after the tour. If your apartments are pristine and exactly as you represented them, some potential tenants still change their minds after seeing the apartment up-close and in person. The reason can be your appliances and fixtures. An apartment can look great at a glance, but old fixtures reflect badly on an otherwise beautiful place.
If applicants tour only to realize the stove and light fixtures are the same ones installed in the 1950s, they might worry that the pipes and wiring are equally old. For some, old fixtures don’t fit into their vision of their lifestyle. For others, they worry about the safety of old features. This is why updating units and appliances is an essential part of staying competitive in the apartment market.
6. Doors and Windows: Poor Security or Insulation
Some tenants tour with their long-term experience in mind. When they tour, they check the details that really matter. For many, that is split between physical home security and saving on the power bill. If the windows rattle, that’s bad news on both counts. Keep an eye on your weather stripping and your door latches and deadbolts, because some of your best – most careful and responsible – potential tenants will be.
If the door handle rattles when they enter, if they can see sunlight around the front door, or if windows rattle in the wind, some tenants will notice and seek other residences that feel safer and better sealed. Many apartment buildings cater to security-concerned tenants by providing extensive internal and external security measures to both protect and assure residents.
How to Reduce Your Lease Declines
It’s always promising to receive an application you can approve with confidence. When those potential tenants then decline a lease or back out of an application, you want a solution. How can you prevent future declined leases, how can you help future tenants say yes to your apartments? While you can’t change the fact that moving is a fickle time, you can make your apartments more competitive and tours more satisfying for every potential tenant. Contact us today to streamline your turnover and tenant conversion strategy.