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Posted by on in Apartment Leasing
  Millennials are getting all the attention. Often ignored to this point has been their younger sibling—the aspiring, involved, and more technologically mature child. And most multifamily companies aren’t spending enough time looking at and analyzing Generation Z. Generation Z (also known as Post-Millennials, the iGeneration, Plurals or the Homeland Generation) has quickly become the largest generation since the Baby Boomers. Although Generation Z has not yet been defined precisely, they are generally known as those individuals born between the mid-1990s and 2010. That makes this generation particularly important to the rental market as many are just now reaching the age to seek and obtain housing independent of their parents. (Side-by-side comparison of adult population by generation)   As these young adults become a bigger force in the rental economy, what do multifamily professionals need to know about them? Better yet, what should we expect? Delivering on this unique generation’s demands and expectations early on will be critical. And with an ever-growing saturation in multifamily communities across the nation, customer experience differentiators will be key.   Gen Z Renters are Tech Savvy More than any generation before them, Generation Z is at home with technology. They are the first generation to live their entire lives in a world of smart phones, internet connectivity and social media platforms. Most in fact, have never even experienced the “annoyances” of dial-up or wired internet access. Remember the AOL yellow figurine that was frozen on your screen while all those funky noises were coming out of your computer’s speakers? How about the guy’s...

Posted by on in Apartment Leasing
For multifamily operators, there are few more important responsibilities than pinpointing the applicants most likely to become residents who pay their rent on time and in full every month. Failure to do so can lead to a cascade of negative effects: increased vacancy rates, lost revenue and even lengthy collection processes, all of which pack a nasty wallop to an apartment community’s net operating income and bottom line. With so much at stake, it is absolutely imperative that the resident screening process be as thorough as possible — and it can’t be truly thorough unless it includes an applicant’s rental payment history. Traditionally, resident screening revolved solely around an applicant’s credit score, which provides past payment history on credit obligations, such as credit cards, auto loans and mortgages. Generally speaking, an applicant’s credit score is highly predictive of his or her likelihood to default on rental payments. However, in certain cases, a high credit score doesn’t equate with a likelihood to pay rent on time and in full. By the same token, a lower score doesn’t always translate into a propensity to default. And for a vast number of apartment operators, simply approving only applicants with high scores and rejecting ones with low or no scores is unrealistic, given the surrounding demographics and occupancy and revenue requirements. Simply put, a screening process that includes both an applicant’s rental payment history and credit score, regardless of how high that score may be, provides a much more comprehensive understanding of that applicant’s risk...

Posted by on in Apartment Leasing
Many years ago, when my wife was expecting, we decided that it was time for a new car. At the time we lived in Colorado and we determined that my two-wheel drive pickup truck with ZERO snow traction was not an ideal car (even if it was our second car) to have to drive our young baby in.  So I did lots and lots of research. After about a month I settled on the car I wanted. I went into the dealership closest to our home and told the salesperson exactly what I wanted-and asked him if he had what I was looking for.  He said he did.  He pulled the car around and I noticed it was a higher-level package than I wanted. Since this was not our primary vehicle, I didn’t need anything fancy like “upgraded upholstery,” “alloy wheels” and a spoiler on the hatchback lid. First problem.  I let him know that the first thing I wanted to do was test drive the car. I knew the specs of the vehicle, after I had been researching it for a month! I just wanted to see if I liked the way it handled on the road.  So, of course, before we jump in, he opens the hood to show off the engine. Second problem.  I’m sorry folks, this is a car with a 110 hp engine, which will go 0-60 in two minutes or something. (Okay, it’s not that bad!) What the heck was he showing off?? I looked...

Posted by on in Apartment Leasing
How Airlines Can Teach Us to Make Student Communities Take Off! Students can provide a wonderfully reliable demand stream year after year. Knowing that a large pool of prospects will be looking to move in by a particular date is more data certainty than we have most of the time…what could possible go wrong? A lot, actually. For as certain as students start school in the fall, management will panic mid-summer. What if school is about to start and you’re not full? Will you lower prices/add a special at the last minute to attract what remaining demand there is? If that happens, you can bet word will get out to the students who leased earlier at the higher price faster than you can say Snapchat…or however they are communicating these days.  Worse yet is your situation if you didn’t lease up in time. You’re stuck with a slew of vacant apartments, a steeply declining seasonal curve (autumn is the season everything starts to die…including your traffic), and a marketing/sales conundrum around how to convince conventional demand that they would enjoy residing in a property filled with students. Your rents don’t have a chance…and neither do your revenue goals for the year. Students are a high stakes game compared to normal demand and it can certainly be tempting to underprice in order to safely secure occupancy early on. However, operators that are willing to be a bit more disciplined and not give away the farm too early will enjoy a higher revenue payoff. (Note: most Mom and Pop shops are not willing to...

Posted by on in Apartment Leasing
zmot-sales-performance.jpg I’ve written before about Google’s seminal research on the “Zero Moment of Truth” (ZMOT). For those not familiar with this, Google identified that pre-internet, every prospect had to talk to a salesperson in order to get information needed to make a purchasing decision. They referred to this as the “First Moment of Truth” (FMOT). With the internet, prospects now do research on their own, often intentionally avoiding salespeople until (and only if) they absolutely have to do so. This “Zero Moment of Truth,” happening before the FMOT radically changes the sales dynamic in many ways: The salesperson no longer benefits from an asymmetry of information in their favor. At best, there is information parity; at worst, the asymmetry is now in the prospect’s favor. In many ways, we’ve moved from a caveat emptor (“Buyer Beware”) world to one of caveat vendit (“Seller Beware”). Manipulative models and tactics simply don’t work as well as they did before, if at all. In fact, given a much more knowledgeable and savvy prospect, these tactics can backfire and lose. Authenticity thus replaces tactics. This isn’t just a moral statement, it’s now a business imperative. Salespeople are now more curators of information than providers. While prospects are more knowledgeable and savvy, they are still much less experienced, so the opportunity now is to connect with them by teaching them something about the process they’re going through. “Always be closing” should now be replaced with “always be helping” Connections come best by asking great questions more than giving good answers. Prospects mostly...

Posted by on in Apartment Leasing
pot-new-pets.jpg (Warning: Don’t read this if you’re not interested in hearing a provocative point of view) I was meeting with a client of mine who has communities in California, and they shared a letter they were sending their residents. The letter was informing residents that, while California had passed a recreational marijuana initiative, the law gave apartment owners the right to declare their property to be marijuana free. The letter went on to inform residents that this company was exercising that right and that any use of marijuana in their apartments would be a violation of their lease and could result in eviction. As a resident of Colorado (one of the earliest states to approve recreational use in homes) and a demand management modeler, this got me thinking. I wasn’t surprised that my client exercised their right; in fact, I expect that virtually all professionally managed communities will do or have done so already. But is that really the right business answer? Perhaps the continued disconnect between these state laws and federal laws makes it the right answer. Perhaps there are indirect liabilities I’m not fully aware of (though not a lawyer, I would struggle to understand how liabilities surrounding marijuana would be any different than what already exists with alcohol consumption)? Or perhaps there are legitimate concerns related to managing issues like the potential for, shall we say earthy, aromas to permeate a building and annoy other residents (more on that later)? All of which reminded me of pets and...

Posted by on in Apartment Leasing
most-effective-email.jpg I was talking with one of my clients about sales management, and the topic of how many unanswered follow ups are appropriate before declaring a lead to be 'lost'. He admitted his company had no standard, but surmised that if they did have one “It would be at least three, maybe four”. I generally agreed with him that three or four was reasonable, provided he added to that one more email or voicemail…the most powerful and effective email/voice mail in a salesperson’s bag of tricks. It’s so powerful that it can only be used once with a prospect; and like many powerful tools, using it too early will negate its power. What is this magical email or voicemail, you ask? Well it’s not really magical, but it does have strong results. We call it 'the break up email' and it goes something like this:   You’ve left some combination of four emails and/or voice mails (preferably a mix) with absolutely no response from the prospect. You don’t know if the lead is lost, and you’re clearly stuck. Leaving more messages would just be annoying, so it’s time to take control (one of the three Ts of InSite Selling). Send an email (or leave a voicemail) like this: Dear (name), Thanks again for your interest (fill in community name). In the past couple of weeks, I’ve made several attempts to contact you again to discuss this. I know you’re probably very busy, or you may no longer be interested in leasing a new...

Posted by on in Apartment Leasing
Dear Gabby,   First off, I would like to put on the record that I LOVE being a property manager. I couldn’t imagine waking up in the morning and doing anything else. It’s like one of my favorite Quentin Tarantino quotes: “When Superman wakes up in the morning, he's Superman.”   BUT… I do have some pet peeves and annoyances that have been building up recently. I wanted to see if you could list some common pet peeves in the industry so that I don’t feel as bad. I mean, if everyone is feeling the same way that I am, it can’t be rude...right?   I just want to make sure that I am normal and that I am not being overly picky or mean.   Sincerely, #SuperAnnoyedPropertyManager _________________________________________________________________________   Dear #SuperAnnoyedPropertyManager,     I TOTALLY get where you are coming from. Sometimes you just want be able to turn your work phone off like a normal 9-5er and head to the movies to see the new Star Wars movie with your kids. Instead, you’re getting calls and texts about a break-in, flooding, or a neighbor’s music.   The short answer to your question about pet peeves being a thing, is YES! We all have things that get on our nerves.   To make you feel better, here are the four pet peeves I hear about the most from property managers:   The questions that come up when screening residents Most property managers top pet peeve is when potential residents ask...

Posted by on in Apartment Leasing

An article on how to lease to Baby Boomers is a shift isn’t it, from the normal focus on Millennials. Now some of you are thinking, “It’s about time we stopped focusing on those Millennials!!” While others of you are thinking, “Why would we focus on Baby Boomers?? They already own their homes!” The truth is while Millennials will continue to be a major force in the rental housing industry for years to come, Baby Boomers are still a crucial component of your success too. Did you know that over five million Baby Boomers (including current homeowners), aged 55 and over expect to rent again by 2020. (Source: FreddieMac) If you think about it, this makes perfect sense. Many Baby Boomers have spent many, many years working hard, climbing the corporate ladder, raising children, while pursuing the “American Dream” of owning a home. And now many Baby Boomers want someone else to take care of things so they can enjoy the lives they’ve worked so hard to create. So what can you do to attract Boomer renters? I’m going to focus more on the “people” aspect here, since you may not be able to do something about the product or the price, depending on what you do at your company. But, you can control you, right?   So here is what you need to know. First, I want you to watch this classic Chrysler commercial with Ricardo Montalban…. Did you see how they compared a Chrysler to a Mercedes-Benz and Rolls-Royce at the end? What...

Posted by on in Apartment Leasing
2017trends.png As we close out 2016 and look ahead to 2017, I can’t help but reflect on what I think some of the key multifamily trends will be. We make more of deal about the change from Dec 31 to Jan 1 than any other change from one day to the next, which in some ways makes for an artificial sense of “newness.” Yet at the same time, it’s useful to collectively assess where we are, where we want to go and what will help or hinder us on that journey. Here’s some thoughts on what I think will be some hot topics for 2017: 1. Soft or Hard Landing. No one disputes that we are past “peak YOY revenue growth.” The question is whether we can settle into several more years of near-historic growth or whether we will hit a national rental recession (we already have market recessions in cities like Houston and San Francisco). Since my crystal ball is particularly hazy on this one, I fall back on the mantra, “Hope for the best, but plan for the worst.” I recently blogged on ways to deal with a down market, so check that out. 2. Rising Customer Expectations. It’s happening in every industry and ours is no exception. A combination of increasing disruption from technology and continued growth of affluence in major markets. Think about it. Last time I was in New York, I was amazed at how clean the taxi that I rode in was. Then I realized they...