Property Manager Can't Find Renters

[Diane Tycangco]

Hello everyone, first of all, I am a remote investor and have a property manager manage my property.  We have been looking for tenants for a month now and have not been successful.  To help the property manager, I have run Facebook ads which have had tremendous response and I have directed these potential renters to the property manager.  Property manager says applicants don't qualify or some people who have actually been to the units say they are too small.  We have lowered the rents already.  Property manager says the only solution he can suggest is to lower the asking rent again or we can terminate the property management agreement to let me find the tenants myself and then re-sign with them once I have tenants in place.  

The property manager's requirements are gross income should be 3x rent, 1 year rental history with no renting from friends and relatives and 600 credit score or 70% of debt should be in good standing.  

I am 3-4 hours away and it will be hard for me to meet the applicants face to face to screen them aside from the background check.  I don't know what to do.  I don't know if the property manager has not been trying hard enough because they have other properties to manage or if the units are really too small or if the applicants really don't qualify or the rent is really too high or what the reason is.

The units are not luxurious and are basic.

Any recommendations would be appreciated.

[Drew Sygit]

@Diane Tycangco despite media stories that rents are still going up, we're part of NARPM, where many members are having to lower rents recently.

Sounds like the property is Class C based on the requirements.

In our experience, a lot of Class C applicants seem to have a hard time paying application fees, submitting accurate applications and all required documents. Often takes 2+ weeks of followups to piece together enough VALID info to make an approval/denial decision. 

Suggest you book 30-60 minutes with your PMC to go over in detail some of the applicants they've denied, so you have a better understanding of their efforts - or lack thereof.

[Diane Tycangco]

Thank you.  That's a great idea.

[Nathan Gesner]

Quote from @Diane Tycangco:

I'm with Drew; you should schedule a conversation with your PM and figure out what's holding it up. It sounds to me like it's a simple pricing issue. I can tell you that Facebook is a great place to get leads, but the vast majority of them are crap applicants that aren't ready to rent or they're not going to qualify. You may want to lower the price, but you don't want to lower your standards.

Do some serious research online. How many rentals are there in the market? Is yours of lower quality? You mention a small bedroom, so I wonder if the layout is less appealing than others. Can you take better pictures? Improve the description?

[Anthony R.]

Maybe consider getting it staged, taking photos, and showing it staged, so potentials can picture it in their minds?

Any small improvements you can make to make it more attractive? (New paint? Counter tops? bathroom vanities?)

[Eliott Elias]

Ease up on your requirements. Know your market and who you cater to, I don’t know yours but I wouldn’t require a super high credit score and clear background in a lower neighborhood