Time is Money: Reduce Turnover Time & Resident Turnover – Increase NOI
A recent article in Multifamily Executive discussed lowering costs of unit turnovers. These included staggering move-out dates throughout the month, reducing the use of subcontractors for certain tasks like painting, and increasing rental rates to offset the expense of new carpet. The article makes the assumption that very little can be done to improve resident retention. Let’s look at some specific actions that may assist in reducing turnover time, reducing expenses, increasing resident retention, and therefore, increasing NOI.
Implement a Preventive & Scheduled Maintenance Program
Create a regular maintenance schedule for all your units and buildings. This will allow inspection and repair of units while they are still occupied, minimizing the work necessary at turn. Properly maintained apartments have been shown to increase resident retention as well. Remember to include building and systems maintenance such as roofs, HVAC, plumbing, and electric in the schedule. Your trusted vendors will typically assist with a number of these inspections as a value added service.
Standardize Supplies, Products & Vendors
Implementing standard paint, carpet/flooring, faucet, and fixture colors and grades for unit turns not only saves time, but money. By standardizing products, your costs should decrease by buying in bulk. Consolidating vendors reduces costs associated with invoice processing, inconsistent pricing/discounts, and quality of work. Time = Money.
Consider the Value of Hiring Temporary Workers
During peak turnover seasons, hiring temporary workers (painters, handymen, etc.) may prove to be less costly than additional days of vacancy rent loss. Do the math. If your rent is $1000/month, each day vacant = $33.33 in lost rent. Five vacant units = $166.65 per day. If you can reduce the turnover time by just 3 days, you will improve vacancy rent loss by $499.95. Even the best maintenance team needs some assistance occasionally.
Be Realistic & Honest
Do you and/or anyone in your organization have the time to review, develop & implement these necessary steps? Consider the real value of a reputable GPO (Group Purchasing Organization) like Buyers Access. By utilizing our Account Management, and Member Services Teams, one phone call can accomplish the majority of these time = money savings programs. Our average member realizes a NOI of over $50 per unit per year.
To learn more about other cost/time reducing strategies and services that Buyers Access can offer, contact us. We look forward to hearing from you.
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Buyers Access • 1777 South Harrison Street, Suite 300 • Denver, Colorado 80210
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