Difficult Economic Times Have Affected the Apartment Industry
With difficult economic times... Unemployment is rising... Delinquencies dog revenue... more and more potential renters are doubling up... Traffic is slow... Occupancy is edging downward...
Apartment Communities need more resident prospects:
Calls - with so many renters doubling up we can't afford not to generate as many as possible,
Visits - statistics show that results are much stronger from online contacts if responded to within the first hour,
Emails - increasingly resident leads do not want to talk on the phone or otherwise interact. Some properties we serve have closed over 10% of their leases without a ...
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After Hours Leasing Support
This is a PAY per RESULT Apartment Marketing Solution.
We have found that potential residents fill out applications after work once they have gotten home. This means that rental applications are submitted after your leasing office has probably closed. Our research suggests that applications that are responded to within the hour lease more than 50% of the time. Because of this we have professional leasing agents at our central office between the hours of 8am to 2am which ensures that more than 90% of all applications are responded to within an hour. Even if your leasing office is not open, you ...
Resident Lead Generation
This is a PAY per RESULT apartment marketing solution.
Our Resident Lead Generation solution generates 2-3 daily new calls. How do we do this? We have identified some of the Internets leading web presence companies. We place weekly updated ads of every floor plan on each of these companies' websites. Craigslist, Whitepages, Google Maps, Yahoo Local, etc...
Customer Feedback - Beckie Foust
"Occupancy100 generates 1-2 qualified leads per day"
"Currently Occupancy100 generates 1-2 qualified leads per day, and 3-4 new applications a week. We love it. Most of our new tenants have come from occupancy100s services."
Beckie Foust Property Manager - ...
Finding Better Residents
Finding better qualified residents is essential to the success of your multi-unit property. Increasing apartment occupancy can be done through two main methods:
The first method for finding good, qualified residents is to heavily advertise your apartment so that you capture as many potential residents as possible, and then weed out the many unqualified rental applicants. This method of resident acquisition brings you a plethora of potential residents but heavy advertising is expensive.
The second method for finding great qualified renters is to only advertise to renter prospects who are more likely to qualify. Acquiring renter traffic though this method of resident ...
A summary of tenant rights in the state and municipality
The first late date
The notice of eviction date
Workout guidelines for managers and guidelines should follow credit scores
Court filing requirements
Expected time to gain a court date
A written process that includes checks and balances that will prevent managers giving favors to tenants and will maintain as brief an eviction process as possible
A written description of the process to turn over uncollected rents to a collection agency
A selected collection agency with local references
A thorough and prompt eviction process is a significant component of maintaining cash flow. Less obviously, the collections process is an important part of maintaining and improving the quality of the tenant base.
The notice process should also include procedures for calling, knocking on doors, and otherwise assuring the tenants respond immediately to late notices. There is a direct correlation between keeping tenants as nearly current as possible and the collectability of their rents. The further behind lease payments become the more difficult they are to collect.
I ran into a great post on multifamily insiders by Bill Gray (the Land Lord Doctor) on tenant screening. I suggest you give it a look for some great indepth ideas on tenant screening. If you have thoughts on the same please comment.
“Ask these questions when talking with the current or previous landlord:
1. What was the tenant’s payment history?
2. Did the tenant give sufficient notice according to the lease?
3. Did the tenant fulfill all of the terms of the lease?
4. Did the tenant give a reason for moving?
5. Were there any complaints from neighbors about the tenant?
In the course of checking my usual blogs, looking at LinkedIn discussions, etc. I continue my quest for contributors and input writing a series of books for multifamily industry operations and investment.
The initial installment will be a bit higher level book designed to help an apartment investor assure that the right resources, the right skills, the right due diligence, and the right plans are in place. Marketing will be touch on more lightly in this book, but future installments will delve more thoroughly into many areas.
If you are interested in helping out in anyway, drop me an email at blake.ratcliff@occupancy100.com
The largest metropolitan areas in the U.S. have seen high density renting for sometime. Many communities have taken steps to attempt to manage the issue. However, in the final analysis if cost of living demands it then this will be a reality.
As apartment operators, why should we embrace this trend?
In the industry, we tend consider density related to tenant behavior issues. This association is based on experience and should not be ignored. How do we counter this? Some ideas that stand out include:
Increased deposits based on density.
Processes to identify density violations and processes to bring the violating tenants into compliance.
Processes to better tenant and manage tenants for screening. Perhaps additional charges for added parking needs are a good response. Or, co-signature requirements on leases.
Ignoring the issues is not reasonable, but the economy may have created a new reality that we can’t realistically ignore.
Apartment communities can capitalize on the current economy. In the past, consumers who wanted any particular item could rely on readily available credit to simply purchase the item. This is no longer true.
Consumer credit has fallen 7 straight months. In July, credit fell $21 billion. In August, credit fell $10 billion. In September, credit fell $12 billion. News reports this week describe consumer spending as weak and focused on necessities.
A multifamily operator with imagination is uniquely positioned to be the value provider to residents. For one price and some imagination, a community can:
Reduce the cost of living,
Reduce outlays for necessities, and
Provide luxuries that are otherwise unavailable.
Communities can provide services for good profits yet at a discount to alternative sources because your community is captive, your collections process is in place, and your staff is already positioned to provide much of what is needed.
Secondarily, the environment may be right to significantly increase retention. And, increasing retention reduces cost.
Hopefully, we all understand very clearly how critical the move-in process is for establishing a positive resident relationship from Day 1. However, in the hustle and bustle of the daily grind, an astonishing figure has come to my attention:
According to 2nd Quarter 2009 data from SatisFacts Research, only 73% of residents indicated that all appliances and fixtures worked properly upon move-in!
That means more than one-quarter of all new residents had an appliance or fixture that did not work!
Are we okay with this stat? I hope not, because unresolved issues at move-in reduce the percent of residents “very likely” to renew by one-quarter!
So, what to do? Let’s re-evaluate the make-ready inspection process. One tip I learned from Bill Nye is the concept of “walking right,” or “follow the wall.” This means, for the final inspection, the maintenance team member enters the apartment and follows the wall to the right stopping to check each light switch, outlet, phone jack, window treatment, doorknob, appliance, light fixture, etc. Eventually, you end up at the front door again.
Rework is always costly – whether in time, materials, customer patience, or all of the above. Ensuring the resident’s new home is truly in move-in condition will be the first critical step in assuring the resident they have made the right decision in making their home in your community.
What make-ready inspection tips are effective for you?
We have been working hard to create as many helpful videos for you to enjoy as possible. Here is a video that explains our apartment marketing solutions, and offers a great overview on Tenant Lead Generation, and the Online Rental Application.
In the past few weeks, we have made several great improvements to our Online Rental Application and our Application Management Software. Please take a moment to watch our 4 minute video:
Physiological responses to visual stimuli that make you feel (Psychology) happy, secure, and calm.
Lets explore the simple psychological and physiological responses in humans and apply these to how we can improve customer experience.
Physiology is what the body physically does (the phys- part of the word) when stimulated by the environment.
Psychology is how your brain interprets physical stimuli or in other words how it makes you feel.
Psychological and Physiological responses are completely different and separate responses to stimuli from the present environment (sound, colors, people, room arrangements, sitting vs standing, and many other factors are part of the environment) although physiological responses affect psychological responses. It is important to be able to differentiate between these as an understanding of such responses will help you create an effective environment to deal with all sorts of problems. An effective environment will help your leasing consultants close more leases, your staff will be happier and more comfortable at work, and it will even help calm angry residents.
So I will give you this scenario: A resident in your multi-unit property is furious because they have had a maintenance request open for 3 weeks, and no one has even contacted about them. Oh oh! This could mean trouble as an angry resident will not only cause you a personal nightmare, there is a distinct possibility that it could cost you a lease or more!
What if your leasing agent is in the process of having a potential new resident fill out a lease an application, or even a lease agreement?!
So what do you do? How do you set up your leasing office environment to calm an angry resident or help promote trust to get more applications and leases?
Today lets look at the visualcomponents of the environment:
Light is the first and most important component, not just the amount of light but the type of light can make a big difference. There are several types of light, but the best and most calming light is natural light. The human body natural physiological response to light is general awareness and the general psychological response is happiness. But why is this?
Physiology – When your eyes and skin are exposed to light several sympathetic (or rather in simple terms, excitation) responses are triggered. The stronger the source of light the more this response is elicited.
Psychology – The physiological excitation elicits a psychological response of happiness. The best way to explain this is: What is a nice day? Sunny and warm or dark and gloomy?
The sun’s light is the strongest and best source of light (plus its free!). Having several large windows will allow you to utilize this beautiful natural resource.
Good light = happy and focused staff + happy prospective residents + helps create happy calming feelings in an angry resident.
Colors are a second important component of the environment. Dark colors and red (fire-like) colors are the worst choice. You will want to have light colors that promote calm and secure feelings. The color of your apartment community leasing office can have a big impact on leasing success. Click on Apartment to read more about the psychology of color.
Physiology – Light colors reflect more light or rather “light up the room”. Again like above this triggers the excitation of the human nervous system.
Psychology – Like above, excitation of the nervous system caused by natural light promotes feelings of happiness.
Light or rather pastel like colors reflect more light, and promote feelings of happiness. Here is something to think about: Do you remember your high school yearbook? What color were the eyes of the superlative winner of “the best eyes”? Almost all of the time they are light blue.
Light pastel colors have higher light reflectance = happy and focused staff + happy prospective residents + helps create happy calming feelings in an angry resident.
To read more about how colors affect your staff’s mood and concentration click on apartment marketing.
Look for our post tomorrow on how sounds can help your customer’s experience.
The short answer many properties are being thrown into default by these changes. Properties meeting LTV, DSCR, and other required metrics are suddenly underwater.
Consider the effects of these changes plus increasing capitalization rates on owners and investors. Projects that made tremendous sense a few months ago now are struggling. Over the coming months many more will face the same issue.
As this situation comes to its full head, properties will sharply reduce expenses in numerous ways cutting repairs and maintenance, staffing, marketing costs, and almost any area they can pursue to push up their value before the appraisal, improve DSCR results, and many more.
