When the economy falters and your competition is throwing out concessions and cutting their prices, there is a strong temptation to do the same.  But before you even think about doing that, you should revisit what the rental experience is like at your community.  Although you may need to adjust your rents in a changing market, remember that for any consumer product, including housing, there is always a wide range of prices people are willing to pay.  Price adjustments should only occur after all other aspects of the rental experience are reviewed.

When you lower your rents without first looking at what you can do to add value, the impact goes beyond your most recent rental.  Be aware that your existing residents are also looking too – and when renewal time comes around (or even before), they will want a better deal from you.

Your Job is to Create Value that Others are Willing to Pay For.

Value these days goes beyond the physical product.  It encompasses the whole package of services and experiences that go along with that product as well.  While having your property show its best is always important, we need to look at what can be done to improve not only the physical, but the service side and the virtual experience to create added value at your property.

Virtual:  The first impression someone has of your property might be what they see when driving by, but it is even more likely that it is what they see online after running a search of available units in your area.  Whether you lease through a property specific site or a company-wide site, the design of the site, the ease of navigation, the quality of the images, and the features your provide (like virtual tours and 3-D floor plans) will all help improve the first impression, and therefore the value, of your property.

Just as important is your online reputation.  Ratings and reviews are critical these days and most prospects make their decision whether to move forward and contact the property or not, on how your overall review profile stands up.  You must know what the world is saying about you, and If you don’t like what you see, it’s time to start working on improving this aspect of your virtual presence.

Physical:  The physical product is still a primary driver of rental value.  And your property should always look its best.  How is your curb appeal when people first approach your property?  Does the landscaping impress?  Or, if in an urban location and there is no landscaping, is the property clean and the lobby crisp?  What is your impression as you walk the tour path through the hallways or across the grounds?

In the unit, how does it feel when you first open the front door?  Is it warm and welcoming?  What amenities and features have you put in the units?  Do your units look ‘one step up’ from what someone might expect that is looking in your price range?

Have you added any ‘wow’ features to your property?  These are the things that go beyond a prospect’s expectation or items that differentiate you from your competition.  It might be a great outdoor area with a nice fountain and luxury seating, or a wonderful game room and lounge.  It might be upgraded fixtures in your units or smart home features like automated thermostats, locks, or lighting.  Every property and market is different, but if  you want to get a larger share of your traffic converting to residents, having something different and better than they can get at your competition will help ensure that.

Are you thinking about what is currently on the mind of your prospect?  Many are concerned with safety and health due to Covid-19.  You can demonstrate this in your physical product.  It could be something as simple as creating a very welcoming BBQ area outdoors with seating arrangements that obviously incorporate social distancing between groups yet provide a great outdoor dining and meeting experience.

Have you thought about adding automatic doors in the common areas so people don’t have to touch things they don’t want to?  Automatic locks to the units?  Not everything has to be high-tech.  Community gardens are very popular right now.

Think about how to energize your public spaces.  On a cost per unit basis, common area upgrades get a bigger ‘bang’ for your dollar.  For first impressions, think more like a hotel lobby and less like a typical apartment community from the 1960s.  Maybe you create a media center with a large high definition television to watch big games or a coffee bar to start the morning.

Service and Experience:  The services you offer and the overall experience you provide is a key differentiator in creating value, in your resident retention, and in the rents you can charge.

Is your community pet friendly?  Nearly 2/3 of all US Households own a dog or a cat.  Do your pet policies encourage responsible pet owners?  Are you thinking about what breeds of dogs do well in multifamily or still using weight limits on pets?

No one wants to live in a building where they know no one in the other 10 apartments on their floor.  What are you doing to create community at your property?  People who become connected to their neighbors and the property are much more likely to stay long term, reducing your turnover costs.

Maximize the use of your amenities.  You may provide a community garden, but how about offering demonstrations or even having cooking classes based on the types of produce your residents are growing.  Building community and providing experiences are key desires for residents.  WiFi availability and great cell reception are also highly desired.

You may not have a rooftop grilling area, dog park, and in-unit laundry, but you can focus on connecting your residents and creating a sense of community.  It’s about planning events and finding ways to link residents.

Recovery will come not from mass discounting

Success and prosperity does not come from mass discounting.  It comes from making your property the best value for your existing and future residents.  And, while you may need to cut your rent price, depending on your market’s circumstances, stop and think of your other options before going this route.

There is a strong temptation to jump to price (or concessions) first when vacancies rise and leasing stalls.  However, the negative impact it creates on your existing tenancies and your property’s value can be so great, and lingering, that you should first look at your other options before slashing prices.

When you focus your energy and finances on making your property a place your residents want to live, it will have many benefits.  They will stay longer, they will take better care of your property – and they will act as your marketing department and, when vacancies do occur, help you find people who are predisposed to rent at your property at reasonable rents.