If you’re a property manager in today’s market you know you’re facing conditions that you may have never faced before. Those who are proactive and innovative will prosper, even in today’s economic conditions.
Currently in markets like Southern California, vacancies are at levels not seen in over 15 years. One property manager there told me, “Competition for rental property vacancies is at extreme levels. I have to use more incentives to fill them and be very creative.”
She said they are even reducing the monthly rent in some areas to attract new renters. She gave me some other ideas and incentives that she’s been using lately to get results:
- Offer the 13th month of rent free if they sign a 12 month lease and follow the rules.
- Adding and offering appliances. In some instances she offers a refrigerator, a new dishwasher or an upgrade in a stove or oven.
- She has begun to consider pets (with a deposit) within certain restrictions.
- Offer 6-month or 9-month leases.
- Return part of the security deposit after the first year upon your annual inspection. She uses “maintenance” as her reason for doing an annual inspection.
- Set the rent for the first lease period slightly below the average for your area.
When it comes to “Resident Retention”, this seasoned veteran of Property Management and Ownership gave me some of her ideas that have been the most effective:
- Give an annual holiday gift like a gift card or certificate to a popular food store.
- Reward residents for following the rules and “staying in touch”. For example, she gave a resident a $30 gift card for coming up with a helpful idea about keeping the laundry room cleaner.
- Send a letter to all residents you want to retain and state, “due to current economic conditions we will be canceling our annual rent increase…your rent will stay the same for the year ahead”, or words to that effect.
- Set up a dedicated email address for residents to use so they can directly communicate with the property manager.
- Be responsive to resident’s complaints. Let them know you’ve received their complaint and will investigate.
Stay tuned for Part II of this article where I’ll discuss ways property managers can keep owners happy.
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