It appears that our industry has, at long last, *almost* fully embraced menu based pricing in all markets.  Even without revenue management software such as Yieldstar and LRO, we're finally managing to realize that 'one price does not fit all' and have seen increased revenue as a result. (Note here: When I worked for industry legend Joel Altman approximately 20 years ago, he had us using menu based pricing even then). And that's a good thing. But we still need to make one more adjustment and I find that many property management types kick and scream when I suggest this to them. I really don't understand why.

We all have that ‘list' that we use for pricing: $10 for a better view, $15 for a preferred floor, and so on and so forth. But it seems that we use the WORST apartment in the entire building/property as our starting point. And I think that's wrong.

Our starting rent for a floor plan type should be a ‘basic apartment'. One with an average location, an average view, an average square footage (we all know about those units that have the quirks to them, like smaller closets, square footage, etc. Those are NOT our average.) The base price should be set from our most standard types. Then, when we should look at our inventory and find the ones with detrimental items, such as horrible views, smaller spaces, undesirable locations, etc., and accordingly, we should subtract rent from those unit types.

Let's face it - those particular apartments always have the highest turnover because they are the worst of the lot. So let's finally - as an industry - price them fairly. I think you'll be surprised at how much easier they will be to rent and have residents stay longer term.

Every time I have done this in my 20+ year career, those particular  apartments have leased immediately and have stayed occupied. Every single time.

Try it. You have nothing to lose and everything to gain. Or do you have an opposing viewpoint? I'd love to hear BOTH sides of this issue.

BTW, if you like my blog posts here, please feel free to vist my blog, www.ApartmentMarketingBlog.com where I post regularly as well.