Is Your Property Keeping Up with the Joneses?

While the idiom “keeping up with the Joneses” normally refers to conspicuous consumption and materialism, sometimes it is a good practice to compare a property to other like properties in the area. Most companies utilize a standard business plan for judging property success with factors such as low vacancy and percentage of outstanding accounts receivables. However, if there is no baseline for property success using regional factors, how can a property management company justify that a property is truly meeting or exceeding other properties? It’s time to break out the troubleshooting (for more tips on Troubleshooting, see the blog post 5 Troubleshooting Tips) and see how a property stacks up!

shutterstock_34922758-resized-600Occupancy

A vacant unit can quickly add up to significant lost revenue. Start with a look at competitors in the same market then expand to see if there is a submarket that needs to be served. For example, the market may be considered Cleveland but the submarket would be the suburbs. How many competitors are in the market/submarket? Are there an abundance of vacancies across the market/submarket or is it just a few? Are there any similarities in the properties that have higher/lower occupancy rates? Are there tactics being used by the successful properties that can be leveraged?

Resident Retention

Research and history tells us that keeping a resident is more cost efficient than finding a new one. Is the property planning ahead on renewals? Do leasing agents actively engage residents to check in on their experience at the property or is there only communication when the rent is due? Can residents manage their own accounts through your mutlifamily property management software (if one is in place)? Are notice-to-vacate reasons being tracked to determine if residents are leaving due to life changes or specific experiences they had at the property? Proactively acquiring resident feedback could drive up renewal rates when residents see the property is responsive and understanding to their needs.

Service Maintenance

Few things can ruin one’s day quite like a broken appliance or a tub that will not drain. Residents want a simple and effective way of connecting with service staff to report their issues and have them resolved. In addition, residents want a consistent positive experience when dealing with service requests. Does the service maintenance staff have service level agreements (SLA) for work requests so that residents have the correct expectations? Are service trends being monitored, such as units with a specific type of appliance enter more requests? Is preventative maintenance being completed consistently on the property? Do you use or utilize the benefits from a multifamily property management software?

Collections/Late Fees

Some states/localities have specific rules when it comes to collections and/or late fees. Is the property adhering to these rules regularly? If not, the property could be opening itself up to legal penalties as well as residents that may delay payments. Is the property tracking the amount and/or percentage of collections and have an escalation policy in place to handle problem residents? Is the property reinforcing language in the lease agreement for amounts due and following through on penalties?

Market Presence

Today, renters have a plethora of ways to conduct research on a property before they schedule a walk-through. Is the property checking online for resident feedback? Is the property aware of their public face online? Has the property worked to correct any negative feedbacks and promote the positive feedback? In addition to reputation, renters will be completing price comparisons to find the best deal. How well does the rent offers for the property stack-up with competitors? Does the multifamily property use a management software tool, such as Vaultware’s Market Comps, so they can adjust rates as needed?

The items above are just a sample of ways to compare properties and assess areas for improvement. Just as multifamily property management teams review financial reports on a regular basis, including a comparison to neighboring properties should also be routine when assessing property performance. Utilizing property comparisons may reveal that other properties should be comparing their goals to your success!

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