Monday, May 25, 2015

Did The Owner Lower Your Rents?

The great debate continues as to what the best property management software is. Who cares? Obviously, a company is going to pick the most affordable solution that will offer the most bang for its buck. As long as you can track residents, finances, and keep up with what is needed for your company, I don’t think it matters what you use.

There is also a lot of discussion regarding revenue management. I think this should matter a great deal to your company. If you cannot afford this pricey add-on to your current software, I think it is vital to employ a savvy manager who can direct your property to maximize its potential rental income. However, if you do nothing, or worse, LOWER your rental rates, then you are devaluing your property and investment. Why would a company or Owner do this?

In one instance, you might consider this strategy if you are very low in occupancy and need to get some cash flow going. In another, you might do this to build occupancy in order to increase the rent roll in order to market the property as a stable asset in preparation for a sale. Other than those two instances, there is never a good reason to devalue your asset. 

As a manager, when you are directed to lower prices, get ready. If there was no communication to indicate the strategy is to be used short term, then get your resume ready.

Sunday, April 19, 2015

Renter's Remorse

Have you ever had a Prospect walk into your Leasing Office, take a tour, submit an application and once he walks out of the office your Consultant jumps for joy. Oh, Boy! Another Lease! All right, all right, all right!

Unfortunately, the very next day, he either calls or emails you to tell you he has changed his mind and decided not to sign a lease. Or, worse, he signed the lease and paid the deposit and fees and calls a week or so later to say he “can’t move in” and wants to cancel the lease and get the deposit back. What?

We call that Buyer’s Remorse (or Renter’s Remorse.)

Is there a way to counter that, or prevent that from ever happening, or even save the Lease that is quickly slipping through the Leasing Consultant’s fingers? Yes and No. The short of it is, no, if you have trained your Leasing Team to push people to make a quick, on-the-spot decision, you may not be able to save it (unless you want to play hard ball.) If you have encouraged your Team to not ask appropriate questions and make a solid connection with their Prospects, then you may have to let it go, especially if they haven’t signed a lease and paid the deposit.

The best leasing decisions are made thoughtfully, from the Prospect’s gut, with plenty of communication between the person and the consultant. That is in a perfect world. But we don’t live in a perfect world. This is the one situation that annoys me to no end when a Leasing Consultant tells me “we lost one.” Why? I always want to understand the why of this situation. Here's the long of it.

Ask the Prospect WHEN he wants to move.

Ask the Prospect WHICH floor plan is best for his lifestyle and which one he PREFERS. Just because you have a lot of two bedrooms available SHOULD NOT dictate where the Prospect should be taken on tour. If you have a Consultant on your team who gets pissed off because someone asks to be shown three different units, then shame on that Consultant – get rid of that person. No one should be told by your staff where he has to live. If you push them into accepting the decision of the team, then forget about getting the renewal.

Ask the Prospect HOW MUCH HE WANTS TO SPEND on rent. Seems like a simple question, but oftentimes, a Leasing Consultant just tells the Prospect how much the apartment is without deducing the optimal payment he can afford. After all, he might be able and more than willing to spend a few more dollars to get the apartment of his dreams. Or, during the conversation, the Consultant may learn the Prospect is in seasonal employment, or has plans to go back to school and will have less money to spend on rent. It pays to listen.

Finally, again, it PAYS TO LISTEN. Ask WHERE ELSE the Prospect is considering living. This may help the Consultant gain a competitive advantage and can guide him to present the best features of his property compared to the other one being considered. Leasing Consultants have to be able to get the Prospect excited about moving, moving to your community, and about spending money to live in that community (value!). If he does that, I doubt seriously, there will be many times you will be told, “We lost one.”

Wednesday, March 11, 2015

Direct Solicitation On Other Properties

Targeting other apartment communities with your Flyers and Door Hangers is just plain crass, in my opinion. I don’t understand why property management companies, even well-known companies with what appears to be a bottomless budget, continue to send their employees over to properties after hours to litter the neighboring property. 

Reasons to NOT ENGAGE in this type of “Marketing”:

1.      Hello? Ever pay attention to the posted NO SOLICITATION Signs? Your entire staff can be visited by local law enforcement and issued Orders of Banishment. Do you want to post bail for your Leasing Consultant who is arrested for trespassing?
2.      Safety – Nothing can ensure your safety. Attacks occur anywhere and do. Is sending your Leasing Consultant out to paper the neighboring comp worth THAT?
3.      Think this is great Guerrilla Marketing? Think again! It’s a nuisance and sets your community up to garner a BAD REPUTATION. At the comp you just crammed with litter, your apartment community is becoming known as DESPERATE.

Marketing Directors who feel this is the best use of their monetary resources and salary budget, should get out of apartment marketing then. I know – you stress that, even if you get only ONE NEW LEASE, it is worth it, I feel you are wrong. And if you, as a Marketing Director find out that one of your managers has sanctioned the use of this outdated, classless type of advertising, tell that Manager to just Cut.It.Out. Otherwise, attorneys out there will send you their lovely Cease and Desist letters and a bill for the time and trouble of paying someone to clean up the litter.