I have some apartments that are in need of tenants! My PM is getting an abundance of calls however either they have 60lb dogs OR request section 8. I am staying away from Section 8 as it's my personal preference to find tenants who are financially responsible. When I sell these properties in 5-7 years, no section 8 tenants will be more appealing to the prospective buyers.
My rents are at market @ $525 & $575. My units are nice & clean. Location of both properties range from C / B -.
My PM recommended a rent special.
Example : First month $300 + Security Deposit.
$99 move in special....
However I am not desperate but I am all for a little incentive! My thoughts are $100 off 1st months rent...This is my first go at "Rent Specials"
Anyone with tips, suggestions, experiences, let me know please!
All and any advice is welcome!
If I were you I would call the competing apartment complexes in the area and ask what their specials currently are as a "perspective renter" and then try to beat those deals. After that, market it on your business's facebook page and Craigslist - especially Craigslist.
The key in marketing is giving your target audience something better than other complexes will. The tenants that will be financially responsible will be the tenants that compare what your apartment gives in terms of deals and quality. And with Christmas time coming, getting a little out of that $300 makes immediate room fro Christmas presents.
Is your town a college town? Think of specials that would make a college student's parents happy as well.
I hope whatever you decide to do works! Have a good day
Appreciate the quick feedback! The PM company advertises on Craiglist as well as other online platforms. The apartments are near a university however we don't tend to attract off campus students.
I'll consider the 50% of first months rent for attraction.
I don't know. I tend to question whether a move-in special is going to make a difference. Why not just lower your rent $25 a month? Thats essentially what you're doing by giving $300 off.
Typically, there's a reason why a house/apt is vacant. Either its the price or the product (i.e condition of the home, the area its in, the schools, etc). Its usually not that you're failing to give a move in special. Or maybe your PM just doesn't know how to sell it at the showings.
I always point to having the right people skills to rent houses. And its very clear to me that its true. My wife, who tended to have a mistrust of applicants and a bit of an attitude in her showings (as if every tenant might rip us off because one or two of them had to be evicted), was not very good at closing an applicant. She was about 1 in 10. I'm more one out of 3 or so. If I get 3 showings on a house, I'm pretty sure I'm going to have someone want it. Doesn't mean I'm putting them in there because they may not meet the criteria. But at least I'm having them submit the app and acting with a sense of urgency.
So there's always a chance its the PM too. But I think it really always goes back to price and product. Either you're overpriced or there's something off on the product. I don't think a move in special is the way to go......
The fear I'd have with that is that you're letting someone in who doesn't want to pay an entire months' rent. I think you're going to attract more questionable people with that approach. And if your screening misses the bad tenant, then you're going to take the hit.
Mike, I agree with you 100%...Basically the way my PM company handles a prospective renter they screen them. They check background for felonies, evictions, income etc....we are getting a lot of renters whose credit is lacking but they have no felonys, evictions etc... When a tenant has a poor credit they request 1st months rent, last months rent & deposit. This is EXTREMELY hard for the tenants I am normally get. This day and age getting $1500 at once is impossible for some, just can't make it.
I am struggling with getting people in to come up with 1st month and deposit at times however I am not desperate either. I am doing as much pre-ground work as possible to try and avoid later trouble of non-payment.
I can agree with you that reducing rent may be a much better option. I rather wait for that quality tenant, they will come but I guess it takes time.
Thanks for the input!
why don't you want to allow animals? I have had some amazing tenants with animals. I usually can get more rent because their is more demand from tenants with animals, I also charge either $50 pet rent or one month security deposit And my houses don't sit. I do have class a properties so take my advice with a grain of salt. On the other hand by making sure my tenants have "skin in the game" I have done very well!
I second what Elizabeth says about animals.
And I question your assumptions about Section 8. On what are you basing your belief that when you sell, the units will be more attractive without Section 8 tenants? That is by no means universally true.
Hi Elizabeth! I have seen a few of your posts and like your "Class A" approach. Ultimately I may get into that but right now I think APT complexes are my thing for larger equity growth / cash flow. Appreciation in my area is slim to none. I am always aware you have Out of State rentals, that's amazing! One day I'd like to connect with you!
Back to rent specials.... I do allow SOME pets. My PM is to advise me when a qualified tenant has a 20lb or smaller dog / cat. I charge $30 monthly. I personally do not like pets in the units however if it takes the unit getting rented I will. So far just 2 qualified tenants had 60lb dogs and I can't seem to swallow that. These properties are C+ / B-... Stronger towards the B.... My target tenants are fixed income (SSI/DISABILITY) tenants, older and want to stay long! Trying to re-market these units Is hard. I am debating "updating" some units.. I know the rents will remain some what the same so it's hard for me to justifying going outside of new carpet and paint.
Appreciate the advice!
Richard, it's my opinion that Section 8 has been stigmatized. I do have about (8) Section 8 tenants & they are great. Been there for years and never call in for any issues. I get my rent on the 1st of the month and nothing to worry about.
As I was looking for my first APT complex I wanted to stay away from buildings that were all section 8 because of the "drama" that CAN be attached. Obviously financially responsible tenants can do just as much "damage" as section 8 tenants, if not more!
Without section 8 tenants signifies a stronger rental market, better tenant pool. I am creating such a marketing event for these properties to help me reap a good profitable sale. Numbers are numbers... As an investor, I can't just look at numbers as there are many more attributing factors than numbers.
Maybe I am trying to beat the odds but I think ultimately if I can manage all financially responsible tenants it will look good on the books for future prospective investors. My numbers aren't suffering however if I lose a few tenants, maybe I will re-consider section 8.
Apartment buyers.. what are your thoughts? Do you consider Section 8 based complexes?
Going into the holidays I can see where a rent special might help. I have not used them myself but it might get someone waiting until after the holiday to move now. Have you seen what he is getting for prospects? or is he just telling you? If he is not getting any calls the apartment cost is too high. If he is getting calls that don't qualify see if his ads might not be good enough. In any case I hope you are getting data and not just his word on the calls.
If you think you might consider pets I would have him just take the info on type of pets when people call too. Then you could see where you might open your market if you are willing to do that. I only accept pets on a case by case basis.
Also if you would consider short term then be sure to post on the university off campus housing web site, they might have some prospects (even for long term)
My PM states he has got over 60 calls in regards to the apartments. A lot of calls from the signage at each property. By the way, I'm going on her word. We are in communication daily. Price is definitely in line as I have done my market research.
Great idea contacting the university. It's worth a shot.. More advertising the better!
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