Betty’s a self-described ‘old-timer’. She has been through more up-and-down economic cycles than she would care to number. "Happy Days are here again!" she told me. "But you know, it doesn’t last."

Way to kill the mood, Betty.

She is right. Cycles are called cycles because they keep coming around. In most of the markets I visit times are good. Vacancy is down; rents are being pushed. It is time to seize the day! Increase rents, pump increased revenues back to your profit-starved investors and make those long-deferred capital improvements.

However, now is the time to put on your Leader Cap: your job is to take the long-range view. What are the potential outcomes of our current management behaviors?

First, review economic reality:

Homeless - According to the MBA National Delinquency Survey, 4,296,018 homes were foreclosed, sold in a short sale or the mortgage was over 90-days delinquent in 2011. Of these, 1,445,000 houses were lost due to foreclosure or short sales. Each of these people moved in with friends or family, are in a shelter, living in their car or are your new residents.

Unemployed / Underemployed - Bloomberg reports that while the unemployment rate is dropping (down to 8.3% in January, 2012), underemployment is hovering around 17%. These are folks who are working well below their potential.

No Cushion – MSN Careers says that 42% of Americans are living paycheck-to-paycheck while Economicrot puts the figure at a staggering 77%. Either way, there are a lot of people whose economic canoe could be tipped over very easily.

Add this all together and we have a very nervous, jittery pool of potential renters (at least those who did not trash the balance of their credit or are unemployed—those folks do not meet our Resident Selection criteria and will just have to remain on their mother-in-laws’ pull-out sofas.) We have seen this angst played out in the Occupy movement. Folks are fed up and they are not going to take it anymore. Another lesson we need to learn: people are voicing their frustration.

Consider the recent reaction to the Susan G. Komen for the Cure foundation’s decision to stop funding Planned Parenthood. Within hours people stormed social media sites to protest. The foundation reversed its decision and promptly alienated everyone on the other side of this political hot potato. According to a February 4, 2012 article by Keach Hagey in Politico, "Twitter and Facebook are being credited with giving oxygen to a wildfire of protest that delivered profound, immediate political results in a way that would have been impossible a few short years ago."

Our world will never be the same.

Five years ago the protests would have been voiced in letters to the editor—buried in the back pages of the National News section of the paper. PR folks would be please because of the mention; however, the memory of the reason for the letters would fade faster than the newsprint. Today the protests will live forever online. It will be a very long time before this issue is forgotten and the good name of the foundation will remain tarnished for as long as Google is searching the world’s information.

What does this mean for us?

Are we raising rents? Explain why. Post it on your Facebook page with a detailed explanation and invite comment. In a senior building, hold focus groups to discuss the issues and invite them to contribute potential solutions. Consider this a safety valve. A peer recently told me that he was implementing a 20% rent increase. This is an investor’s dream come true! (And frankly, in his market it is long overdue. However, his current residents do not care that there have been no rent increases since 2007.)

Our customers have told us they want a few things from us. They include:

• Quality housing
  
  
• Clean, safe and with high-perceived value for their dollar
  
  
• Be nice to them
  
  
• Treat them with respect
  
  
• Listen – our customers want to be heard

We do not want to be held hostage; however, it takes only a slight pause in implementing a decision to consider the ramifications, seek input from customers and bring them into the process. We may have waiting lists today—so who cares that we get some negative press, right? This is where the Leader Cap comes in: this cycle will not last forever. In the future when you need prospects to come in, know that they will be researching your property online. You will be thankful for a positive reputation then.

Social media has many benefits but we also have to come to terms with managing or preempting the dark side. So step away from the glow of your computer screen, Droid or iPhone and reach out and touch your residents. The dividends will pay huge returns.

Now more than ever we must consider our customers point of view. What is the impact of each of our decisions on them? How will they respond to it? How can we best explain the issue so that they do not see our actions in a negative light? This means taking time before implementation to consider how to frame and present the message.