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Property Management Minutes

Thoughts and Observations on Marketing, Leasing, Maintenance and Property Management Operations

Finding The Lost Prospects

For an end of the year report, I pulled some data on the number of move ins for my group. While the results are good, and show some occupancy improvement..I’m all about the next step. What can I learn from the data? What do reports tell us about our performance?

When a property is performing well, occupancy is strong, and rent collection is excellent. It becomes increasingly difficult to expect continued improvement. Or so I thought.

The first report that I reviewed provided a list of the total number of applications received during 2016. Adding a filter identifies the number of approved applications.

Then the reality check. The number of approved applications was almost double the number of move ins. Literally 100’s of approved applications never became move ins.  Somehow they fall between the cracks of our daily busy-ness.  They never became our residents. They didn’t add to our rent revenue or occupancy number. Individuals had enough interest to pay the application fee, obtain the thumbs up for approval. Then…..lost…..stolen by aliens? This is not Area 51 in the desert.

Low Hanging Fruit

Its alarming and comforting. How could we have not done the follow-up to secure the move ins? But once again, the low hanging fruit shows us the opportunity for improvement. It’s certainly not impossible. We already have everything we need to increase the occupancy. Now, we need a process to follow-up on the approved applications.

For my group, 20 apartments will grow our occupancy 1%. Thinking that we have to find a net 40 or net 60 to achieve a 2 to 3% occupancy bump sounds like a challenge. Until we realize every one of the move ins needed is close at hand. History is already repeating itself, looking at the approved applications received this month. We need to develop a better system to track the approved applications.

Weekly follow ups

This must be a shared responsibility. Manager, leasing, regional, multi-site manager. At least two brains need to look at the applications and initiate a follow-up effort. If the process to communicate the approval status is delayed, the prospect has other pending inquiries. It would seem, that the timeline to process the application and prepare the apartment drags to the point of boredom. This results in the prospect abandoning their plans to move in. What can be done to prevent this?

Lost prospect It’s not my expectation that all will move in. But without defined follow-up we have no idea why the applications did not move in. These individuals are making important decisions. Choosing a home for themselves, and their family for the next twelve months and possibly longer. They are initiating the process to move in.. Logic implies, an application fee would not be paid if there wasn’t a strong interest in this apartment community.

Prospect Review

With each weekly site review, we will check on the status of the applications that have been approved through our screening provider. This will create accountability and awareness of every application in the pipeline. A number of our apartment communities are smaller with rural locations. The number of applications is only three or four per month. This increases the importance of follow-up and securing the lease from an interested individual.

Finding the Lost Prospects

Even in struggling markets, the number of lost prospects could make the difference to stabilize occupancy. New managers, in particular can be distracted to believe that they don’t need to be overly concerned with this applicant, because there will always be another. When this result in the apartment being vacant for another 30 days, we’ve lost a month of revenue. Taking the time to explain the impact of lost rent, by the day, the week and worst case the month, can create a greater understanding for all members of the team. Every prospect that comes through the door, and calls on the phone has the potential to be the next move in. Increased occupancy is increased rent revenue.

Do you know how many applicants are approved for your property that fall into the Lost Prospect group?  How would your occupancy improve if you could add half of these lost prospects as move ins every month?

 
 
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  • I find this amazing! Do you have data on how long these applications took to get approved? If I was a prospect and just paid the application fee, I wonder how long I would wait before I simply gave up, and if I did, I would surely ask for my money back for the application. When I was a leasing consultant, those applications were gold, so I can't imagine waiting that long to make sure they were approved in order to secure my commission. This is altogether fascinating, and it's amazing that with that many stakeholders there would be that many lost applications. I'm looking forward to seeing what you find!

  • Every application we process is given an approval, decline, approved with conditions or canceled status within 72-hours for most properties in my experience. When applicants do not lease, we provide a reason in the software system so Corporate knows what happened. Like anyone who loves leasing, I cannot imagine letting an application sit untouched or ignored, even after processing. However, I will say this, in student housing, I can tell you we have many applicants who apply and then never respond to our requests to sign the lease. Most of the time this is because the students apply to a lot of places and then choose wherever their friends go.

  • Great article. Like Mindy mentioned, especially in student housing, sometimes these applicants just disappear. However, I think that putting a specific system in place to follow up with all applicants would help to reduce this number. I agree with Brent and Mindy - I can't imagine letting applications sit, and not follow up! Our screening company typically returns results within 24 hours. We make it a priority to reach out to someone within 24 hours of the results to let them know their status. We don't have an applicant waiting longer than 48 hours before getting an answer. If screening takes longer, we send them a quick email with the expected return date from the screening company.