Quick Answer: Turnover rate measures the percentage of residents who move out during a period. Retention rate measures the percentage who renew their lease. They are complements: Turnover Rate + Retention Rate = 100% (for leases that expire). High retention directly reduces turnover costs, vacancy loss, and leasing expenses.
For a deep dive into each metric individually, see our full turnover rate guide and full renewal rate guide.
What Is Turnover Rate?
Turnover rate measures the number of move-outs as a percentage of total units over a given period. It quantifies how frequently units change hands and directly correlates with make-ready costs, vacancy days, and leasing workload.
Example: 90 move-outs ÷ 200 units = 45% annual turnover rate
What Is Retention Rate?
Retention rate (also called renewal rate) measures the percentage of expiring leases that renew. It focuses specifically on residents who had the choice to stay and chose to do so.
Example: 110 renewals ÷ 180 expiring leases = 61.1% retention rate
Key Differences: Turnover Rate vs Retention Rate
| Factor | Turnover Rate | Retention Rate |
|---|---|---|
| Focus | Move-outs / departures | Renewals / staying |
| Good direction | Lower is better | Higher is better |
| Denominator | Total units | Expiring leases only |
| Includes early terminations | Yes | No (only scheduled expirations) |
| Cost implication | Each turn = $3,000–$5,000+ | Each renewal saves that cost |
| Typical range | 40–60% annually | 50–65% |
When to Use Each Metric
Use turnover rate when: Budgeting for make-ready and leasing costs, staffing the maintenance and leasing teams, forecasting vacancy loss, or identifying properties with abnormally high move-out activity. Turnover rate drives operational planning.
Use retention rate when: Evaluating renewal pricing effectiveness, measuring resident satisfaction outcomes, comparing leasing strategy across properties, or setting retention improvement goals. Retention rate measures the success of your resident experience program.
How They Relate in Practice
Improving retention by just 5 percentage points has a cascading financial impact. For a 200-unit property with 180 annual lease expirations, moving retention from 55% to 60% means 9 fewer turns per year. At $4,000 per turn in make-ready costs plus 15 days of vacancy at $58/day, that saves approximately $43,830 annually — which drops straight to NOI.
The most effective operators track both metrics and analyze the reasons behind each move-out. Are residents leaving because of rent increases, maintenance issues, life changes, or competitive options? The move-out reason data informs whether the problem is pricing (renewal trade-out too aggressive) or experience (resident satisfaction too low). See how BubbleGum BI's operations dashboards track turnover and retention rates and quantify the cost of each turn across your portfolio.
Track Turnover and Retention Across Your Portfolio
BubbleGum BI tracks turnover rate, retention rate, and the cost of each turn — helping you quantify exactly how much retention improvements add to NOI.
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