Move-out rate
What is it?
The KPI aims to measure the proportion of rental properties where the tenant has moved out during a specific time period, expressed as a percentage of the total available rental units.
It provides insights into tenant loyalty, property attractiveness and to design strategies to minimize move-out rates and maximize tenant retention.
How is it calculated?
Total number of contracts / number of rental objects
* Includes only those leases where the end date falls within the specified time period.
Why is it important to follow?
The following are reasons why it is important to follow the KPI:
Tenant retention: The move-out rate provides insights into how well the property manager or rental company manages to retain existing tenants. By monitoring the move-out rate, one can identify any issues or reasons for eviction and take steps to improve the tenant experience and retain them longer.
Cost savings: Reducing move-out rates can reduce the cost of marketing and filling vacant units. It is usually more cost-effective to retain existing tenants than to attract new ones.
Financial stability: A high displacement rate can indicate problems with the property's attractiveness or service quality, which can lead to irregular revenue streams and financial uncertainty. By following the move-out rate, you can work to ensure a stable and predictable rental income.
Trend analysis: The move-out rate can be used to identify trends and patterns in tenant behavior and preferences. This can be useful for adapting leasing strategies and property management to meet changing market conditions.
The quality of the rental property: A low move-out rate may indicate that the rental property meets the tenants' expectations and needs. It can be a sign that the property offers attractive housing or premises and provides a positive experience for the tenants.
In summary, the move-out rate is an important measure of the tenants' loyalty and satisfaction as well as the property's financial stability. By following this KPI, property owners and managers can identify opportunities for improvement and take steps to increase tenant retention and reduce costs related to vacancy and tenant turnover.
Created by Homepal
2/6/2024
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