If you’re active in the property management and leasing field, it’s likely you’ve noticed what we’re calling a “pause” in the market. Even if you’re new to the industry, it shouldn’t come as a shock that real estate in general has experienced somewhat of a slowdown in the past several months. It seems as though COVID-19 caused the entire country to take a step back and pause spending overall. People were scared and didn’t know what to expect for the future of their jobs and home life.
Now, a few months into the pandemic, most have found ways to adapt. Fewer meetings are held in-person, and when they are, hand-sanitizers and heavy cleanings are must-haves between showings. While there were already many ways to “shop around” online prior to COVID-19, it was a “nice-to-have option,” not a need. The online real estate experience has become significantly more interactive and intimate with offerings like virtual showings and private Facetime tours.
On the property management side of the industry, hiring a videographer to help fill units in a complex has been a valid solution to reach new prospects. The videographer can capture all the best and essential parts of a staged unit, and voila, you have a virtual showing to share with as many prospects as you’d like. In some instances, renters are submitting applications and units are rented before they’ve even stepped foot on the property.
While “the pause” has hit “play” in some areas, we’re still seeing some unusual happenings in other areas of the rental market. Here are four challenges we’ve noticed and four solutions to help you manage them:
#1 Slowdowns in College Towns
Challenge: With most colleges and universities around the country sending students home to learn virtually, the new challenge of renting out properties in college towns has arisen. Tempe has certainly seen a big hit in the number of rentals filled. What was once a sure thing is no longer, at least for the time being.
Solution: Get creative and offer incentives! Consider incorporating programs like refer-a-friend, the first month’s free, or a lower security deposit to help fill units. Think about what you can do to lower the total move-in cost for your new tenants. Don’t, however, forget your vetting process!
#2 Inconsistency in the Luxury Market
Challenge: Even people with deeper pockets are unsure of how to proceed. We’re still seeing movement on luxury rentals, but on a more inconsistent basis.
Solution: Remember who your audience is for luxury rentals. They’re paying more for a property that has high-end amenities, so they’ll probably need more nurturing than a typical mid-range prospect. Technology is on your side! Consider creating personalized content to sell directly to them. You can create a template using a video you’ve already created about the property and bookend your message with customized greetings. If you’re not video-savvy, take creative photos of the amenities on the property and send to prospects with personalized messages.
#3 An Expectation to Negotiate
Challenge: We’ve seen multiple interested prospects come to the table and immediately expect some sort of price negotiation because of current events. It’s a difficult situation, but renters are not buyers and generally speaking, it’s not a best practice to negotiate monthly rent.
Solution: Make sure your property is priced in the sweet spot for the market by taking a look at comps in the area. Consider offering reasonable incentives like lower move-in costs, or refer-a-friend. It’s not bad to show empathy for the current climate, but at the end of the day, you also need to put food on the table.
#4 Loss of Initial Interest
Challenge: Seeing prospects show initial interest and then radio silence.
Solution: Be diligent in your follow up communication! Now is not the time to let potential renters waiver and wait in their decision to apply. If you have a follow up strategy for prospects, up your game! Add more touchpoints to the matrix and remind them what they’d be missing. For your time management, make sure you’re templating as much as you can. A little customization to a template goes a long way.
All in all, our local market is holding its own. Although the initial “pause” understandably brought concern, we’re seeing things pick up simply by nurturing leads. We’re living in a time where nearly all communication is virtual. People want to feel the support of other people, so remind them you’re there! Communication will always be a key to success in this business.
About Real Estate Intelligent Marketing (REIM):
REI Marketing is an innovative Real Estate Marketing Company that offers distinctive real estate services to developers and multifamily investors. We are a vibrant, dedicated team of industry professionals with international experience in marketing and multifamily investment.