How to Lease Apartment Units Faster

release edition [017]

read time [5 minutes]

Welcome to The Multifamily Download, a weekly newsletter where I provide institutional insights to help you build an exceptional Multifamily career.

Today at a Glance:

• Leasing: 10 Simple Strategies
• Weekly Listen: The Rent Roll

Update

Well, it was another busy week this week. I've been watching the economy, and collecting a ton of interesting data points that I'm excited to share with you in the weeks to come.

As a result, today's newsletter will be short and sweet. The focus of today's newsletter is all about how to increase leasing velocity in a soft or challenging market environment. Enjoy!

Leasing

Property management is often both an art and a science.

The science is all about offering the right units at the right prices with the right incentives.

The art is about the team, the pitch, and the delivery. Team members working on the front lines rarely get enough credit for their contributions to the leasing process.

With poorly managed leads (new prospects) or customers (existing residents), the apartment business becomes exponentially more difficult.

However, markets change, and sometimes units sit vacant for prolonged periods of time no matter how great a leasing team member may be.

Today, let's look at 10 ways to improve leasing velocity during a slower or more challenged market environment.

1. Mini-Model Units

Visualizing furniture in a vacant space can be challenging. Often, rooms look and feel larger once they have furniture in them, so adding a blow up mattress in a bedroom, or a chair or floor lamp in the living room can go a long way to helping shape the space for prospective residents. Plus, it's a meaningful step towards making an otherwise cold, vacant unit feel more like home.

2. Lower Asking Rents

This is the most obvious and easiest strategy, and therefore should be one of the last to be implemented. Remember, the lower the rent, the easier it is for a prospect to qualify (all else equal), and new qualifications can lead to a new resident profile at the property. Keeping rents higher (especially in rent-controlled markets) with concessions is often more favorable to lowering asking rents with no concessions.

3. Holding Open Houses

By hosting vacant units open during a defined time period, prospects will (hopefully) see other prospects touring and feel as though the property is in high demand. This is a good thing. Plus, it's easier to prepare and staff the property for elevated demand when that demand is more predictable.

4. Monetary Concessions

Concessions are when the property owner gives something to the prospective resident, and can be either monetary or non-monetary. Similar to lowering asking rents, offering monetary concessions are obvious and easy, and should be offered only when absolutely necessary. Giving away money to generate more leases is an effective strategy, but not an ideal one.

5. Higher Leasing Bonuses

Incentives drive behavior, and higher leasing bonuses will incentivize leasing team members to work harder to secure new leases from prospects. Now, I'm not suggesting that leasing should become a high-stakes, high-pressure, and pushy interaction. Rather, elevated incentives should be a means for encouraging leasing team to do everything in their power to professionally service the new leads, qualified prospects, and current residents.

6. Higher Marketing Spend

Slow leasing velocity may be due to lower traffic amid a noisy marketing environment, so increasing or shifting ad spend is a simple way to generate more eyeballs and traffic. Evaluating and analyzing current marketing channel costs per lead, costs per lease, and conversion percentages are great ways to double down on what's working best.

7. Non-Monetary Concessions

There's a surprisingly high ROI when deciding to offer non-monetary concessions such as a free TV, free appliance, or gift card to prospective residents. These are typically cheaper than the dollar-for-dollar equivalent that would need to be offered with monetary concessions. Said differently, prospects often value stuff more than digits.

8. Lead Follow-Up & Engagement

This strategy is not surprising, but it's often overlooked. I frequently ask our property management teams about their lead follow-up strategy to ensure they're focused on engaging with existing leads. Waiting for the perfect prospect to walk through the door is a losing strategy, especially in a soft or challenging market environment. Remember, the fortune is in the follow-up.

9. Increased Resident Referral Bonuses

Who doesn't want to live near their friends? Incentivizing existing residents to refer their friends can lead to stronger retention of multiple residents: the current resident referrer, and their friend that elects to move in. Plus, the ROI on a $500 referral bonus can be extremely attractive relative to a unit sitting vacant for an additional 30, 60, or 90+ days.

10. Local Community & Business Outreach

Engaging with the community and local businesses can be a powerful way to connect with the nearby demographic. Building trust before a prospective resident walks through the leasing office doors can go a long way towards both helping the prospect feel comfortable and making the leasing team member's job easier.

As with all things in property management, most of these are simple but not necessarily easy. They take work, thoughtfulness, and a strategic approach to be effectively implemented.

It's also important to shop the competitor properties to observe their process, strategies, and offers. This helps keep a strong pulse on what's happening real-time in the marketplace.

A shifting or softening market is not something to be feared. Embrace the uncertainty with the strategies above and leasing velocity will improve.

What else would you add to this list?

Weekly Listen

This week's listen is The Rent Roll Episode 30 with host Jay Parsons and guest Lee Everett, the EVP, Head of Research & Strategy at Cortland, the ninth largest apartment owner in the U.S.

In the episode they discuss several topics such as: supply (on the decline), demand (on the rise) and rents (ticking back upward), Lee's perspective on the market, including why apartments may be well positioned for the road ahead relative to alternatives.

You can listen to the full episode here.

Wrap Up

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