2024
How Asset Managers Benefit by Adding Resident Benefits Packages
Introduction
In today's chaotic real estate market, you need every tool at your disposal to ensure positive net operating income. One such tool is the Resident Benefits Package (RBP)—a unique bundle of resident services that savvy asset managers deploy…quality of life, help reduce operating expense, improve resident retention and protect your assets.
In this article, we'll dive into the specific benefits included in the RBP and how they can provide a significant boost to NOI for asset managers. We'll also share our insights and experience from working with over 1,500+ property management firms, 1M+ residents, and hundreds of real estate investors.
At Second Nature, our expertise in improving the resident experience has earned us the only six-time NARPM Affiliate of the Year and 15,000+ 5-star reviews.
Mitigate Maintenance Costs
How many HVAC repairs and termite infestations do you have planned and accounted for in your budget?
With HVAC work orders averaging over $500 and pest treatments ranging from $250-8,000, these are two crucial areas to mitigate costs.
But how? Preventative maintenance and on-demand service for residents—all through the RBP. Here’s how:
Our Air Filter Delivery Program keeps the air fresh and your HVAC systems running smoothly. In fact, the National Rental Home Council Study found that consistent air filter replacements reduce work orders by 38%. Beyond fewer repairs, replacing filters regularly also extends the life of your system by 5 years.
It’s great for residents too. When your HVAC system is humming along with fresh filters, energy bills drop by 10%, or an average of $177 per year (epa.gov). This in turn means a 10% reduction in kWh (1,071.6 kWh saved per home annually)—saving 1,671.70 pounds of CO2 emissions.
As for those unwanted guests that can create a mess of your property, you can’t always count on residents to front the bill, despite what your lease says. If left untreated, you could have a full-blown infestation on your hands—causing expensive contractor fees, move-outs, and reputational damage.
But with our On-Demand Pest Control service, residents can report a pest problem online and receive fast and effective service that doesn’t cost them anything extra. This shifts all time and costs of scheduling pest control from your property manager operator and onto the residents.
Reduce Tenant Turnover Costs
You can’t make money with empty homes. And with expenses, rent, and labor costs going up, the cost of losing occupants and finding new tenants has almost doubled in four years, making resident retention key to winning in real estate investing.
That’s why our RBP focuses on improving the resident experience, giving them more reasons to stay longer and pay on time.
We do this by turning rent day into rewards day. With our Renter Rewards Program, each resident is incentivized to pay rent on time. When done so, residents can earn over $120 cash rewards annually with the opportunity for over 1k in savings from retailers like Amazon, Starbucks, and Costco—making paying rent that much easier.
To further encourage on-time payments and retention, Second Nature reports on-time payments to all three major credit bureaus as part of our Credit Building Program—giving residents a unique way to build their credit on their biggest expense. Because good credit is crucial in reducing credit card rates and car payments, this benefit is a resident magnet. In fact, we’ve found that 1 out of 4 of residents are 26-50% more likely to pay their rent on time if they have credit reporting.
The RBP also helps you find tenants faster.
With only 10% of properties offering resident benefits, implementing this strategy can differentiate your property and give you a leg up against the competition.
For example, a TransUnion study showed 67% of residents would choose homes with credit reporting in place if all else is equal. And that's only one benefit.
Protect your investment
Managing dozens, if not hundreds of properties, opens your business up to a world of risk—from property damage and theft to missed payments due to a multitude of reasons. Obviously, it’s best not to leave your investment up to chance. That’s why we’ve included two benefits in the RBP that help reduce these risks.
By building our Renters Insurance Program right into the lease and offering plans for $7 less than the national average, we see a 97% adoption rate of our service with just 3% of residents bringing their own policies.
And either way, Second Nature tracks their insurance status to guarantee that 100% of your residents comply with your insurance policies—giving you access to lower insurance premiums.
1 in 8 Americans affected by fraud in 2021 with an average loss of $1,238. And with 62% of Americans living paycheck to paycheck, becoming a victim of identity theft puts their ability to pay rent at risk. With our Identity Protection Plan with up to $1M in coverage, your residents are not only safer, but so is your source of income.
The Bottom Line
We’ve found working with over 1,500 property managers and 1M residents that nurturing the resident experience also nurtures NOI.
By providing key benefits that improve their quality of life, you’ll see higher retention, more on-time payments, lower maintenance costs, and added peace of mind.
Not bad for something that doesn’t cost you a dime, as the RBP simply gets added to the lease. And with low group rates, residents actually save money on already required services like renters insurance—reducing pushback.
As for getting started, we work with your property management operator for initial implementation. After that, the RBP program is hands-off for you and your team.
Interested in learning more? Join our RBP Workshop to dive into every benefit and the implementation process, or schedule a demo with one of our team members to get a tour.