Topic: We are increasing our 2021 rental rates at a higher price point then we are used to. Any advice on how to approach upset residents?

We just explain that we will do our best to work with good existing residents but that there has been a 12% market increase nation wide in the last 12 months and we have to increase prices. Usually once we explain increased property taxes etc and they shop around and see its right they don't complain as often

I managed a community in Lansing and we still had small renewal increases last year with no push back and we is rentmax so we are over market to start and are doing an amazing job renting. Facebook market place and ApartmentList has been killing it for us.

I think first you might want to align yourself with your company. Did your company increase your rental rates or are you increasing your rental rates? That difference isn’t exactly subtle and is fairly fundamental. One you are a begrudgingly pawn passing along bad information to others from on high which they will see and increase their resentment. The other you understand the market economics at play and recognize how this is in the long term best interest of your community and the residents.

We waited too long for an increase, waited during the lock downs and now we are behind due to tax increases and water/sewer rates going up. It will take us some time to catch up to those. If only they knew how much we pay in property taxes. It’s crazy in Lancaster PA

That’s a tough one. We’re in Michigan too, and haven’t raised rent during the pandemic because so many folks have been hit so hard. Any way you can push back and advocate for your tenants? I cannot imagine trying to explain a big increase right now in Michigan.

It’s happening everywhere, you are not alone. Market demand sets your price. With high occupancy due to less evictions there is a very high demand for apartments now. I tell my residents what the market rent is, and how far below that renewal rate to the market so they have a better understanding that while their increase may be high, it’s still a discount. I also offer to walk the home to see if there’s anything minor I can do to add more value for them.

So many are empathetic towards residents and the current situations. But what I have come to find is that only a portion of the resident population has been impacted.
When I raise rents, some roll over and pay. If they raise raucous, I invite them to discuss their situation, and with evidence I’ll defer a rental increase but then I also suggest they look elsewhere for housing.
Property taxes have increased disproportionality over the past years, supplies to operate have increased, cost of services to maintain the property have increased. A rent increase is commensurate to the changes in the economy.

In addition to the above great direction, I’d really make sure you know your comparable properties bc that is what your residents and prospects will be doing as well. So you can speak directly to their opposition factually not emotionally. If there is any property improvements or large scale fixes, that’s always good to communicate as well.
Another key factor is that the home market is really tight. The amount of purchases to available houses is staggering, so the apt market is bound to increase with limited supply.
You can also listen to local news and US news focused around the housing market in case you get stuck in a conversation you weren’t previously prepared for. Good luck!

You and your team have to buy into the value of your product. Sell the value of your property and the services you provide. Market is market and there is a rent ceiling, so position yourself to be closest to that ceiling.

So sorry to hear of this OUCH.....Get ready For lots of notices, skip outs & possible evictions and a low occupancy with no one wanting to rent..

Is the owner planning some sort of rebranding or upgrades for them to look forward to? Are there any changes in your budget? Maybe you can rebudget for more resident functions or offer renewal parties, breakfast bags or doughnuts at the front office when rent is due... Anything to make them feel like they're getting something new in exchange for this "new rent charge"

And be honest with them. "Look, I don't know why rent is increasing, but here's what I have planned for you this year..." And post a calendar of your plans functions, etc.

Did you add any value to the property or units? Are the rates in line with your sub market? If both answers are no it’s going to be hard to retain those residents or get new residents.

All residents get upset about a rent increase. It doesn’t matter what state or demographic. It’s particularly tough to take right now especially because the covid pandemic has hit so many pretty hard. I completely agree with John Ridgway’s response. When a resident calls or comes in upset I always listen with empathy first. I acknowledge their frustration or concerns. Then I explain that the increase isn’t going away but we very much value their residency. I take their $100 increase x 12 and explain that in a 12 month period that increase will cost them $1200. If they move with no help, it will cost double that amount. So it is not cost effective to move. It makes much more sense to renew and stay where they are already settled. I ask if everything is ok in their apartment. Sometimes I get a few items that need attention. So I let them know that we will take care of those items right away. Just calmly and professionally talk through it.

Just like always, we have to show the value in renewing vs the cost of moving. Prices are going up due to market changes, increased cost of services, and the fact that some tenants aren’t paying.

Do a very in depth market survey and update EVERYTHING. What fees others charge what utilities they pay and deposits... every.thing.
If your owners increased rents they either think you are below market or they don't have a very comprehensive view of what you are competing against.
Also, don't be afraid to update the comps. That should be done annually based on new units on the market. New communities push rents up in your area and have specials that initially make them competitive but then just make the areas rent drive up.

Just know your market intimately. They are doing this for a reason I doubt it is greed. All knowledge you have. Really have based on facts not hearsay will help your owners/ management company. If you are doing everything you can and have the backup to prove it you will be fine. Give your residents your ear showing how much you understand without you getting defensive with them. It is the entire market.
Tons of residents throughout the country have not paid rent in awhile. The bills still come in and must be paid. Financing and showing investors what you (owners) are doing may mean the difference of staying open or closing shop - then where will all your residents go. Show you care and if they can they will stay. You may loose a few but we all go on

Let them know its nothing you can control and it’s just what happens within the property management. They either want a place to live or they move out

Can you offer a complimentary service? Carpet shampoo, upgraded LED ceiling fan, install USB outlets, message shower head?? I’ve done this and sent out a “renewal menu” along with the renewal offer. The resident can pick their upgrade at the same time they renew.

You are part of a business and work for the owners.
OWN the decision.
Our rents are adjusted to reflect local market rates.
We provide a resident experience better than nearby communities and believe we are worth it.
The owners will continue to invest in the community and maintain high quality services throughout.
Our increases last few years were lower than normal and we needed catch up to the market.

Cost of business from appliances to property taxes have increased and it is a home cut also a business and you can not lose money especially when demand is high. Do give the best you can offer sincerely....works for me!

Considering the the 2021 pandemic and economic conditions :
Now is the time to take water/sewer expenses out of the rental equation. Rent is rent; Water/Sewer is based on consumption.

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