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Risk: It’s Everywhere!

If there is one thing that property managers know, it’s that we are exposed to risk in all that we do. This “risk” comes in all shapes and forms; some are more evident than others. I am constantly reminding my employees to be careful of their actions as to not expose the property and our owners to possible litigation. Some of the greatest potential risks, as I have found, are in the very small details. Here’s a few that I wanted to point out.

First, consider the “golden rule” of leasing—treat everyone consistently. Consistently being the key word.  I have often instructed my leasing agents to use caution when asking where people are from. Generally, in life this is a great conversation starter, but in the realm of fair housing when we open that door and are inquisitive on a prospects nationality this could be construed as discriminatory (if an allegation were to ever occur). The curiosity of national origin presents a very strong basis for a suit if one were ever made against the defendant (i.e. leasing agent). Think about it: why does it matter where they are from? You are trying to lease them an apartment—its best to stick to questions that qualify the prospect. As an alternative, the leasing agent might inquire about the prospects interests, hobbies, etc. While it may seem like a harmless, amiable way to personally get to know a prospect, its best to leave this question alone.  

Secondly, the guest card. The guest card is an all-important leasing tool whose purpose is to gather bona fide, relevant data pertaining to the apartment preferences of a prospect. Not only does this tool aid in the selling process of the leasing agent, but its auxiliary purpose is to ward-off fair housing claims by providing a record of the tour—time and place, apartment shown, follow up, etc. Consider if the prospect has children. I have been to a few properties where the leasing agent will report the familial status of all occupants (i.e. if they are a child, minor, etc.)—this is a bad idea. It’s best to stay neutral and simply state the number of occupants that will be living in the apartment. Remember that familial status is a protected class.

Highlighting on the guest card. Does your leasing agent highlight guest cards once the prospect has been followed-up on and/or put into your management system? Make sure that the same color highlighter is used. If your property were to ever undergo a fair housing audit, using different highlighter colors may be construed as an internal way to “label” the prospect. At one seminar I attended, this was really going on at one property, and they were slapped with a fair housing violation.

Finally, you can’t charge a resident something they haven’t agreed to. Make sure that your policies are congruent with what the lease states and addendums outline. For instance, if you charge a $75 month-to-month fee, make sure this is agreed to and signed by your applicant at move-in. Some of this may seem fundamental, but I encourage you to audit your paperwork; you may be surprised with what you find. All it takes is one savvy resident to challenge your charges and you will lose.

In this great industry we love, always consider what you are doing—and what your subordinates are doing—and the effect it may have on your property’s exposure to risk. Some risk is clear, while others are hidden in the details.  

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This comment was minimized by the moderator on the site

inquisitive vs discriminatory - Something I need to watch myself.

  John Feeney
This comment was minimized by the moderator on the site

Excellent points! Often leasing agents are just trying to find common relationship ground without any thought given to Fair Housing issues when asking questions regarding interests, family make up, where the prospect is from, etc. Although no harm is intended, it can be misconstrued and lead to legal nightmares. Educate, educate, educate...

  Laura Bruyere
This comment was minimized by the moderator on the site

In regards to the first category listed that reflects what Leasing Agents would typically try to say to build rapport with the apt seeker and inadvertently violate fair housing laws. I'm trying to figure out why (industry wide) are leasing agents trained to be poking their nose into apt seekers information when they first walk in the door anyway? Why do they attempt to "pre-qualify" people upon inquiry of their community? I have been on both sides of this coin and I can tell you by experience that it is belittling to feel like you are being judged about your qualifications to rent BEFORE even filling out an application! Leasing Agents say things in an effort to determine how well they will want this prospect to apply to decide how much effort they are going to put into closing the deal. I feel this is WRONG and a bad practice for agents to do. It's like walking onto a car lot and being approached by the sales man who is trying to size you up to make sure you can qualify for the loan before he invests too much time into the sale. Just the fact that we are asking questions to determine their ability to qualify can be a fair housing issue if someone feels they are being discriminated against by the nature of the questions!

I feel that leasing agents should keep their discussions to highlighting the wonderful attributes of the community and by ANSWERING the apt seekers questions, not be the one asking questions. I've been told multiple times that people really appreciate being convinced to want to rent somewhere verses being filtered out and judged when they first walk in the door. A good leasing agent will still be able to ascertain an opinion on the seeker during these discussions but should not make any judgements or qualifying inquiries until AFTER the applicant has submitted their application to rent. That's when those skills are put to work. By the way, when I walk onto a car lot and test drive a car and the sales man tries to ask ME questions about where I...

In regards to the first category listed that reflects what Leasing Agents would typically try to say to build rapport with the apt seeker and inadvertently violate fair housing laws. I'm trying to figure out why (industry wide) are leasing agents trained to be poking their nose into apt seekers information when they first walk in the door anyway? Why do they attempt to "pre-qualify" people upon inquiry of their community? I have been on both sides of this coin and I can tell you by experience that it is belittling to feel like you are being judged about your qualifications to rent BEFORE even filling out an application! Leasing Agents say things in an effort to determine how well they will want this prospect to apply to decide how much effort they are going to put into closing the deal. I feel this is WRONG and a bad practice for agents to do. It's like walking onto a car lot and being approached by the sales man who is trying to size you up to make sure you can qualify for the loan before he invests too much time into the sale. Just the fact that we are asking questions to determine their ability to qualify can be a fair housing issue if someone feels they are being discriminated against by the nature of the questions!

I feel that leasing agents should keep their discussions to highlighting the wonderful attributes of the community and by ANSWERING the apt seekers questions, not be the one asking questions. I've been told multiple times that people really appreciate being convinced to want to rent somewhere verses being filtered out and judged when they first walk in the door. A good leasing agent will still be able to ascertain an opinion on the seeker during these discussions but should not make any judgements or qualifying inquiries until AFTER the applicant has submitted their application to rent. That's when those skills are put to work. By the way, when I walk onto a car lot and test drive a car and the sales man tries to ask ME questions about where I work or what do I do, I remind him that I will be the one to ask the questions today and to use his discussions on telling me the highlights of the car. And if I choose to buy the car, then we can talk about where I work or what do I do.

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  Susan
This comment was minimized by the moderator on the site

Susan,

Many types of training distinguish interrogation versus qualifying the prospect. A rusty leasing agent or one with little formal training will be more of an interrogator to the prospect, which is a big turn off. The trick is to find "hot buttons" and establish a common ground with the prospect. This may be done by asking more personal questions, such as hobbies, interests etc. and other things unrelated to leasing an apartment. That way, the sales process is more "personal", more engaging, and will lead to a better experience for the prospect. In turn, a higher closing ratio!

  Nathan Borne, CPM®, MBA
This comment was minimized by the moderator on the site

Thanks for the reply, Nathan. I guess that what I do to connect with a prospect comes naturally and I build rapport right from the first initial contact. What I see around me too often is the non-subtle, forced interrogations from employees. Their questions always come across as a pre-qualification session when they really should be rapport-building sessions. Perhaps people in all types of sales, leasing and management positions need more extensive training so they can operate more smoothly in this regard. It is and should be a top priority for those learning this business, if they want to do well.

  Susan

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