Shared post from Appfolio

The summer season is a common end-of-lease timeframe. As a result, many renters wind up moving over the summer. This leaves property managers busy trying to fill vacancies; inspecting units after move-out; and juggling minor repairs, security deposit refunds, and a host of other tasks. If your lease cycle ends in the summer, try these tips to reduce tenant turnover, keep your task list short, and keep everyone satisfied.

Why Tenants Move Over the Summer

Before talking about ways to reduce turnover, let’s look at some of the reasons why tenants move out during summer.

If you are in a university town, there may be natural turnover due to graduation that you will not be able to avoid. There will always be a subset of tenants who leave due to “change of life circumstance” reasons such as graduating, relocating for work or school, obtaining a shorter commute, moving in with a life partner, or moving to a larger apartment (maybe one in your complex). It’s not these tenants that you should worry much about.

What you do need to worry about are the residents who leave for reasons that are within your control. This includes tenants who seek lower rent, more outdoor space or common areas, amenities your complex lacks, a more updated unit, or something else.

Think about the feedback you hear from tenants who are exiting. Are there any common themes? While some tenants may be telling a “white lie” and offer a change of life circumstance reasons, tenants often give you valuable feedback. And if you aren’t asking for it, start!

It may hurt to know that a tenant is leaving because they felt you did not make repairs quickly, or they found a great deal across town on a unit with a pool. However, this feedback is great because it tells you exactly where renters feel your property falls short. By tackling these areas, you can make your property more competitive and decrease summer turnover.

So the first step in retaining tenants is to review what amenities and services you offer, keeping in mind common reasons that tenants leave. Try to identify themes and correlations. You’ll then use them to make improvements to your processes and your property to reduce summer turnover.

How to Decrease Summer Turnover

These tips will help you encourage tenants to renew their lease for another year. Implement tips that make sense based on the themes you identified earlier:

Invite tenants to renew three months before the lease ends. Make it easy for renters to stay by inviting them to renew well in advance of the lease end date and being honest about any rent increases. This gives everyone three months to plan for the future. If tenants decline to renew, you can fill vacancies and reduce uncertainty.

Communicate proactively with tenants. Demonstrate that you are responsive and proactive. The more you can be courteous and responsive to residents, the happier they will be.

Offer a flexible summer sublet option. To increase tenant retention, make it easy for renters to sublet for a set period of time.

Make smart, energy-efficient improvements. Hot summers can leave renters with high energy bills trying to stay cool. If your units are older, weatherize and make energy-efficient improvements to increase comfort and reduce turnover.

Offer a loyalty incentive when renters renew their lease. From a discount on rent to an upgrade like free wifi, there are ways to get renters to renew their leases by offering desired perks.

Improve your property. Keep your apartment complex competitive with other local properties to reduce lease turnover for amenities. Property and unit improvements help attract quality renters who may be more likely to stay.

These proven tips will not only increase resident retention, but will make renters happier and lead to positive word-of-mouth press in your community. Track lease renewal rates to see how every technique you try leads to increased tenant retention and peace of mind.

The post Keep Summer Turnover Low with these Property Management Tips appeared first on The Official AppFolio Blog.

Written By: Ryan Green | CIC

The multifamily housing industry is tiny! Sure, there are tens of thousands of people working in this industry to serve around 35 million renters, but there’s a ‘small town’ vibe you get when multifamily becomes your career focus. If multifamily housing is a business you enjoy and plan to remain a part of, then understanding how close-knit this industry can be will work to your benefit in the long run.

Regardless of where you move around in the country, there is bound to be some kind of apartment association and nearby competing properties you will work with. Quite often these groups will be part of something bigger, and herein lays the potential and necessity for you to make yourself known. Networking is a fundamental tool for many businesses, but multifamily housing is especially a people-first industry. For extroverted professionals this can be a natural part of the job, but for so many introverted people it can be a daunting notion on where to even begin. Fortunately for you this article was written to offer fundamental advice on how to get yourself known across the industry in the best ways possible!

Start at Home

This is the easiest thing so it’s where I’ll start off. If you work in multifamily, you are bound to be surrounded daily with people who do as well. More importantly than just getting along with your coworkers, make sure you build positive relationships. If you’ve ever heard the phrase “don’t burn bridges”, it applies here. Being in stressful atmospheres and locked in close quarters for long periods of time can get frustrating, and you won’t always get to work with people you love. That doesn’t mean those same people aren’t planning to grow within the same industry as you. Odds are you will likely run into them again. Be as pleasant to your colleagues as you are to your residents, and hopefully when you see them in the future they will have only fond memories of how you both got started.

Be Open About What You Want

It’s easy to talk to close friends and family, or look on your Facebook network when you are trying to find an opportunity. It is much harder to connect when you are forced to move beyond your strong ties. In Lisa Green Chau’s Ted Talk she discusses ways to network when it isn’t your natural mode of operation. In her video, Miss Chau references the co-founder and CEO of The Muse, Kathryn Minshew who offered great advice for creating opportunities instead of waiting for them.

1)    Say ‘Yes’! As you hear about events or get invited places, force yourself to attend. This is the first step to getting out there and meeting people within your industry who will have varied experience.

2)    Voice Your Goals. Discussing your ambitions can not only be an interesting topic, but can open doors you never knew existed. This isn’t an invitation to show your narcissistic side, but don’t shy away from letting people you meet know what you are passionate about.

3)    Attend. It is one thing to say ‘yes’, but another to go places when you don’t find a strategic value. Sometimes networking opportunities can be vague, but present enormous possibilities.

Forget the Pitch

Being open about what you want is a great personal tool, but going into an event with a prepared sales pitch is a great way to be seen as fake. Everyone has their own agendas to support their business, especially at work and association networking functions. It’s better to go into these situations with the mindset of making friends; plan to build a rapport with people you meet. This happens over time through brief interactions with most people, and you will see how friendships naturally begin to form. Whenever you meet someone be sure to ask for their business card, and be prepared to give them one of your own. Add them on LinkedIn (if available) so you can learn a bit about who they are and what they do for the next time you interact.

As you progress throughout the industry never lose focus on what makes this business great – the people. With major events and industry conferences occurring all around the country, think of how you would approach such major opportunities. Keep these tips in mind as the bigger the event, the more opportunities you have to meet with hundreds of colleagues and vendors over a few short days. You will be amazed at the wealth of knowledge, experience and friendships you can find when you open yourself up.

About CIC

Founded in 1986, CIC is a leading provider of tenant and employment screening solutions for the multifamily housing industry. CIC offers full service background checks, credit reports from all three major bureaus, the nation’s most comprehensive eviction records database, complete nationwide criminal records search, full verification services and other specialized screening products. For more information, please visit www.CICReports.com.

About Ryan Green

Ryan Green has been working within the real estate and property management industries since 2005, and presently serves as the Marketing Manager for CIC. He holds a degree in Business Administration as well as FCRA and Experian certifications for the multifamily housing industry. Since 2012, Ryan has been a writer for ResidentScreeningBlog.com as well as a contributing author for industry publications, news outlets and multiple forums.

Written by Patti LeBarron | FastEvict.com Law Group

Updating the outdoor space of a rental property can prove to be very useful for a landlord. On the one hand it can increase the value of the property a great deal and on the other hand it can make it more appealing to tenants too. Most tenants these days love to rent a home that has a nice garden or even a backyard where they can get some fresh air and entertain their guests. The following are some of the reasons why updating outdoor space can improve the curb appeal of your rental property and make it more attractive for prospective tenants.

Enhances the Usefulness of the Outdoor Space

One of the main reasons why landlords should update the outdoor space of their rental properties is that it increases the usefulness of that space. For instance, if the garden or backyard has a fountain or a gazebo placed in it then the tenant would have a place to entertain their guests in the open air. An updated outdoor space can work as an additional room for potential tenants, thus making your rental property more appealing to them.

Adds Value to the Rental Property

Updating any area of your rental property can add value to it. Renovating the outdoor space can have a great impact on the curb appeal of your rental property. A well-maintained lawn or garden is sure to make your rental property stand out from the rest. Prospective tenants would be mesmerized with the beautiful outlook of the home and would thus become instantly interested in renting it.

Offers More Privacy to the Tenants

While some tenants might prefer to make their homes private by keeping their windows closed or covered, most of them like to keep their windows open. An outdoor space featuring trees, bushes and shrubs can provide such tenants a more natural means of ensuring their privacy. They won’t have to close their windows or cover them up with blinds and can let fresh air into their homes without compromising their privacy.

Shows Potential Tenants that You Care

Another reason why updating your rental property’s backyard or garden can prove to be crucial to you is because it will send a positive message to potential tenants. Tenants love to see that their landlord is willing to make renovations to the rental property. So, when they will see an updated outdoor space, they would realize that you care about your property’s condition and well-being and thus would have no qualms in signing the tenancy agreement.

Shared post from Appfolio

It’s simple: in order to grow, you need more property owners. While there are some owners who think they can double as a landlord on their own, there are those who can’t and need help—they just don’t know how to select the right property manager.

Let’s explore 10 unique hacks guaranteed to expand your portfolio by attracting more property owners to your management company. It takes time to find new owners; so make them come to you.

Growth Hack #1 – Productized Rental Reports

It’s always important to know what similar properties in your area are renting for so you can stay competitive and successful. With these insights you’ll have the confidence to adjust rental prices to maximize your revenue and fill vacancies faster.

[AppFolio’s built-in rent comparison tool does this for you, saving you the research time!]

Growth Hack #2 – Content: Create Articles to Get Found by Owners

Why is content important? For so many reasons! Content comes in so many shapes and sizes: blog posts, videos, case studies, your website.

• Blog articles show authority and knowledge
• Video content can grab prospective renters’ attention
• Your website can show what you can offer to renters and owners and build your online presence

All of this content combined is hugely important because roughly 70% of searches on Google are long tail. Using long tail keywords in your URLs, content, page titles, and meta descriptions is a popular marketing technique and a way to build authority and an audience. You can use Google’s free Keyword Planner to find keywords that are relevant to your audience and get insight into what people are searching for. Incorporating these words and phrases into your content can be extremely valuable to your appearance in search engines. For example, property owners looking for new property managers might search “Best Property Manager in [input city here]”— so make sure you have content that answers that question on your website. Otherwise, you’ll lose out to the property manager that does.

Growth Hack #3 – Lead Nurturing: Build Relationships through Value

• 50% of leads are qualified but not ready to buy. (Source: Gleanster Research)
• 69% say that creating relevance is the most effective method for lead nurturing. (Source: Ascend2)
• Email marketing is proven to have 4,300% ROI (Source: Direct Marketing Association)

What do these stats mean? That you need to bring value to prospective leads. You can do this through producing high-quality and useful content in the form of customer videos, property walk-throughs, testimonials and reviews from happy renters, and more. Prove to your prospective owners why you’re a good investment and someone people like to work with.

Growth Hack #4 – Reputation: Attracting Owners to Your Business

Online brand reputation and reviews are very important to your growth and success as a property manager. A whopping 92% of customers read online reviews before making purchases. In fact, you can experience a 5-9% boost in revenue by increasing your overall Yelp Rating by just one star. But how can you improve your online reputation when there is such a negative vibe around online review sites? Ask for positive recommendations from your current residents who love your properties! The good reviews will stand out over the bad in the long run.

If you need more help building up your positive online reputation and responding to any negative commenters who are making your life difficult, check out our post: Hug Your Haters.

Growth Hack #5 – Pay Per Lead

One of the more controversial hacks in the list, Pay Per Lead (PPL) either works very well for your company, or doesn’t work at all. PPL refers to buying new unit leads from sites that sell these leads individually. The success of a Pay Per Lead campaign depends on your current marketing budget, ability to scale growth, and the number and quality of leasing agents you might have. PPL is more successful if you are willing to spend the money to wade through potential duds, but on average has a better conversion rate than most other marketing tactics.

Growth Hack #6 – Pay Per Click

A much less risky alternative than Pay Per Lead and a more widely applicable method for attracting new owners, Pay Per Click refers to paying for a top spot on page 1 of all Google searches related to your company in your area. Paying per click also means that you don’t pay a dime unless your site is visited from that link, guaranteeing that the person searching for you has an interest in your company. Dollar for dollar, this is also a cheaper alternative to buying portfolios from other PMs in your area—acquisition costs are usually about $1,200 a unit, where average Pay Per Click costs average $350 per unit.

Growth Hack #7 – For Rent By Owners (FRBOs): Calling the Landlords in Your Area

Why is this important? One of the most successful ways to grow your business as a property manager is to build your network. People are afraid to pick up the phone these days, but don’t be. It’s valuable and there are ways to prepare for those phone calls. Have a script in place so you can practice it and get comfortable saying it—without it sounding like a script. Also, have a structured process in place for researching who you are going to reach out to, when you’ll reach out, and any follow up with them later.

Growth Hack #8 – Join Local Organizations

It’s important that you get to know the fellow owners in your area. Become a pillar in your community. The more people you know, the more relationships you can build. It’s all about networking!

Growth Hack #9 – Utilizing Video – Get Ahead of the Curve

YouTube is the 2nd most used search engine in the world. People love videos! Create short, digestible and fun videos that show off your properties (the atmosphere, style, services and amenities). Make people interested in working with you, e.g. be personable and welcoming. Check some examples of what other successful property managers in your area are doing on YouTube for inspiration.

Growth Hack #10 – Have a Growth Plan

As a property manager you need to optimize on what’s working for you. First, track the source of all your leads so you actually know what’s working (don’t guess!). If one of these strategies is more successful than the others, put your energy (and marketing dollars) into that particular strategy to make it work even better for you.

Ask yourself, how many properties am I looking to add to my portfolio in one year? Two years? In five years? Where do you see yourself? Are you managing residential, or commercial, or student housing, or HOA properties? A mix of all of the above? Set a goal for yourself and devise a plan to get there.

The post 10 Growth Hacks for a More Profitable Property Management Business appeared first on The Official AppFolio Blog.

Appfolio | Company Website | LinkedIn Connect | AppFolio, Inc. develops Property Management Software that helps businesses improve their workflow so they save time and make more money.  Appfolio submits articles & blogs including topics of Resident Retention, Improved Owner Communication, Time Management, and more.

Shared post from Appfolio

Summer is almost here; and it’s a popular time for renters to move in and out of apartments. If you’re busy welcoming new renters, performing move-out inspections in vacant units, and trying to get apartments rented property maintenance can fall by the wayside until things calm down. Yet your renters deserve clean and well-groomed common areas. Make sure your apartments look their best all summer long by adding these summer season maintenance tasks to your to-do list.

Property Exterior Summer Maintenance Tasks

Focus your energy on keeping your property exterior looking great in summer, when outdoor areas will see increased usage.

Put outdoor lighting in place: Long summer nights entice renters to stay outdoors in common areas. To help them get back inside safely, make sure that you have outdoor lighting illuminating pathways and doorways. Solar lighting is an energy-efficient, modern option that requires little maintenance once installed.

Trim grass: For comfort and protection from pests, keep grass trimmed regularly. Set a reminder in your calendar so you remember to mow the lawn every two weeks (or on the schedule of your choice), or contract out to a landscaping company if you prefer not to do this yourself.

Perform a garden/common areas landscaping cleanup: Late spring and early summer is a perfect time to trim back plants, trees, and shrubs. Don’t forget to weed paths and walkways, where little plants can spring up in cracks and make your property look shoddy.

Mulch garden beds: Flowers, trees, and shrubs get thirsty during summer heat. Adding 2-3 inches of mulch to garden beds helps the soil retain water for longer. Plants will look better during long, hot summer days; you will also conserve water usage and reduce utility costs through this eco-friendly landscaping tip.

Wash and repair deck and patio spaces: Outdoor common spaces like decks and patios will see heavy use in summer. Check all of these common spaces now, and make any repairs that are necessary (such as repainting or replacing a loose deck board). Then clean all common areas to remove dust, dirt, and grime. To help keep these areas tidy and reduce the amount you’ll need to clean up after renters, install trash cans on decks and patios.

Clean window wells and gutters: To ensure that rain can flow freely, clean out window wells and gutters seasonally, including as part of summer landscaping. Remove leaves, dirt, waste, and debris.

Property Interior Summer Maintenance Tasks

Tackle these tasks to keep interior common areas pleasant in summer.

Have air conditioners serviced: Whether you have window air conditioners in common areas or enjoy central air conditioning, summertime will place a big demand on your AC. Be prepared by having your air conditioning serviced by a reputable HVAC company. This way, you can make repairs or replacements so your units will work properly when it matters most.

Address gaps in windows, doors, and walls: Summer is prime pest season. These critters get inside through holes in windows, screens, doors, and walls. Get ahead of the pests by sealing cracks in windows and doors using caulk or expandable foam. If you notice that screens have rips, repair them to minimize your work mitigating pest problems later on.

Test smoke and CO2 alarms: Test unit smoke and CO2 alarms several times a year. By adding this to your seasonal property maintenance list, you can help keep residents safe.

Have interior carpets and furniture cleaned: After wet, muddy spring weather passes, treat interior carpets to a deep cleaning. Hallways will look brighter when carpets are cleaned. Many residents will breathe easier when mold, dust, pollen, and other allergens are removed from common area carpets. At the same time, clean interior furniture. Regular cleaning of furniture can forestall furniture replacement and keep your apartment looking its best.

When you are able to keep up with summer maintenance, fall clean up won’t be as time-consuming and you’ll feel less stressed as a result. Property Managers, what other tips do you have for keeping your properties well-groomed all summer long?

Appfolio | Company Website | LinkedIn Connect | AppFolio, Inc. develops Property Management Software that helps businesses improve their workflow so they save time and make more money.  Appfolio submits articles & blogs including topics of Resident Retention, Improved Owner Communication, Time Management, and more.

You might also enjoy:

Hot Apartment Marketing Ideas for Summer

The Importance Of Preventive Maintenance On Properties

The post Summer Season Property Maintenance To-Do List appeared first on The Official AppFolio Blog.

Shared post from Appfolio

It’s basic statistics. The more people see your apartment listings out in the wild, the bigger your pool of possible applicants becomes, and the faster you can rent your vacant units (and the happier your property owners will be). For property managers looking to fill vacancies quickly, these 7 tips to drive traffic to apartment listings can make all the difference.

#1 Create high-quality listings

Even if traffic is your ultimate goal, you need to have strong listings to turn that high traffic into paying renters. High-quality listings benefit most from detailed, accurate descriptions of properties and amenities and clear photos that show apartments in their best light. Once your listings look good, you’re ready to share them.

How to Take Better Photos for Your Property Listings

10 Best Practices for Listing Your Properties

#2 Use real estate aggregator sites

Renters in many cities use aggregator websites like Trulia or Zillow to search for homes and apartments for rent. If your apartment complex has fewer than 50 units, you can create a free listing on Zillow or Trulia. If your complex has more than 50 units, you will need to pay to list the property. Even if you have to pay, this is a great way to increase both listing views and tenant applications. Property management software can ease this manual burden and cost by streaming your listings to third-party sites.

5 Rental Sites for Listing Your Properties in 2016

How AppFolio Boosts Your Marketing Efforts in 2016

#3 Blog about your apartment community

A blog is a convenient way to share helpful information with your existing tenants, increase placement in search results for your apartment complex, and advertise vacancies. Blogs don’t have to be time-consuming; even just blogging once a week can increase the placement of your apartment and open listings in search results. The higher up you can land, the more users will click through to your listings page.

6 Blog Topic Ideas for Property Managers

#4 Pay for online advertising

PPC or pay-per-click advertising can be a simple yet effective way to generate listing traffic. Set a budget and select keywords that include your city or town plus search terms like “studio apartment,” “town home for rent,” or “2BR apartment.” You’ll only pay when users click through to your listing. PPC ads are a reliable way to get traffic quickly. If you accept pets, have short-term rentals, or have any other niche that will set you apart, PPC advertising can help you attract renters searching for apartments like yours.

Grow Your Property Management Business Through Local PPC

Improving Your Digital Marketing Strategies

#5 Share apartment listings on social media

Social media is a great way to drive traffic to apartment listings, yet many property managers aren’t using social media to advertise vacant units. Advertise your open listings across Twitter, Facebook, Instagram, and Pinterest. Include high-quality photos of your apartment and a brief yet compelling description. Existing tenants will share your social post with friends looking for an apartment for rent, effectively marketing on your behalf. While it will take a little time to create initial social posts for apartments, you’ll be able to reuse the descriptions going forward to be more efficient.

Property Manager’s Guide: 7 Steps to Social Media Renting Success

#6 Shoot an apartment video

People love watching and sharing videos. In fact, according to Hubspot 55 percent of web users watch and share at least one video every day. Investing in quality video production will help you generate awareness and desire for properties that you manage. Consider shooting a virtual tour of units as well as a tour of the outside of your apartment complex and all common areas. General videos are best, since they can be reused with all new vacancies.

Lights! Camera! Action! Getting the Most From Virtual Property Tours

#7 Reward tenants for sharing open listings

If you’ve tried all these tips and you still need traffic for open listings, recruit your residents to help you out. Host a contest where renters must share your apartment listing via social media and tag you in the shared post. Then use a random giveaway to reward a renter with a gift certificate, pair of movie tickets, or other incentive. Renters will love the chance to win something for free, and you’ll love the increased traffic.

When testing out these strategies to increase listing views, have patience. Some strategies can take a while to pay off, but they will reward you if you just keep with it. Property managers, have you tried any unusual techniques to drive traffic to your property listings? If so, what’s worked for you?

The post 7 Ways to Drive More Traffic to Your Apartment Listings appeared first on The Official AppFolio Blog.

Shared post from Appfolio

To fill open units and reduce vacancies, you need to know what millennials look for in apartments to rent, then exceed their expectations. While millennials have somewhat different values and preferences than other tenants, with a few tweaks you’ll be able to adjust your approach to attract them.

What Millennials Want in Apartments

Many millennials are long-term renters who are not prepared to buy a home anytime soon but want flexibility in their living arrangements in case they need to move for work or a relationship. They might have a high amount of student loan debt and need predictable expenses so they can set aside income to pay their loans.

Even if they are on a budget, millennials still want to go out and enjoy life. They prefer apartments located near restaurants, bars, cafes, nightclubs, parks, gyms, and other places they can hang out, be social, and entertain themselves.

Yet these renters are not just party animals. Millennials care deeply about the environment. They insist upon recycling at a minimum (composting is a plus). They want to curb water and electricity usage, and enjoy finding new ways to conserve, reduce, and reuse. As much as these renters love being online and using social media, they also like to hang out in person and value community.

They prefer to stream shows on the internet, so fast internet is a key to keeping these tenants happy. On a related note, the internet is their first-choice tool for everything from ordering up food delivery to looking for apartments. You absolutely must be online to connect with these renters.

Millennials also tend to be phone shy. Instead of calling you on the phone or meeting with you in person, they’ll probably opt to send a quick text or email.

Ideas to Make Your Apartments More Attractive to Millennial Renters

Now that you know what millennials like, you can position your open units as modern, efficient, and community-oriented to appeal to these renters. There are many ways to go about it.

Ways to make your apartment modern:

• Develop an attractive website to show off your open units and evidence of your modern approach to property management
• Allow renters to apply online and pay rent electronically
• Let renters make maintenance requests online
• Use millennials’ preferred communication methods of email and text message when possible
• Create social media accounts for your apartment complexes to build an online community

Ways to make your apartment efficient:

• Install low-flow toilets and shower heads in bathrooms
• Use compact fluorescent or LED lights in common areas
• Offer recycling and composting services on site
• Insulate your property to reduce drafts and slash utility bills
• Switch to energy-efficient appliances when upgrading units
• Use programmable thermostats in common areas to keep expenses low
• Have an Earth Day event at your apartment complex
• Adopt solar panels, wind power, or another source of renewable energy
• Showcase all the eco-friendly steps you take on social media and on your website to attract renters who care about their environmental impact

Ways to make your apartment community-oriented:

• Advertise neighborhood amenities, from bars and restaurants to farmers’ markets and parks
• Show photos of community perks (like your swimming pool or picnic area) on your website
• Host parties, movie nights, or social hours – and then post pictures on your website
• Engage with renters on your social media channels
• Have a virtual bulletin on your website where residents can engage and connect with each other

It is illegal to actively discriminate against renters of any age, so make sure not to explicitly turn anyone away from renting an apartment because they are or are not of millennial age. The good news is, all of these millennial-friendly strategies you adopt will make your apartment a better place for all renters in your community.

You might also enjoy:

Who Drives Rental Property Market Growth in 2016?

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The post What Millennials Want: How to Attract Millennials to Fill Your Apartment Vacancies appeared first on The Official AppFolio Blog.

Appfolio | Company Website | LinkedIn Connect | AppFolio, Inc. develops Property Management Software that helps businesses improve their workflow so they save time and make more money.  Appfolio submits articles & blogs including topics of Resident Retention, Improved Owner Communication, Time Management, and more.

Source: techcrunch.com

Real estate investing has long elicited a variety of emotions, running the gamut from excitement to anxiety. When dealing with significant sums of capital, feelings of apprehension tend to creep in, especially regarding neighborhood quality, tenant and property management issues and liquidity.

But those feelings of apprehension should be balanced by the knowledge that real estate as an asset class offers high returns in low-interest-rate environments, provides diversification from traditional stock portfolios and has the potential for long-term appreciation.

Plus, there’s another, more recent benefit to consider for investing in real estate. Technology has enabled radical changes in how and where people invest in real estate. The old adage that real estate investing is a local business no longer holds true.

Millennials, skilled professionals, overseas investors and retirees now have the ability to acquire properties, commercial developments and even homes like they acquire stocks or bonds. Remote investing makes single-family rental (SFR) investing a viable alternative investment option, and with returns that outperformed S&P 500 returns in 2015, it has emerged as a powerful wealth-building tool.

An initial wave of remote real estate investing happened via crowdfunding, which enables investors of all ages, risk profiles and wealth levels to acquire real estate. With as little as $5,000 down, investors across the world can buy a stake in a single-family home, or with a larger investment, they can opt to purchase shares of a 300,000-square foot office tower. Realty Mogul,RealtyShares, Fundrise and more than 200 other firms valued at a combined $2.6 billion worldwide support this type of crowdsourced investing.

While crowdfunding may be a great way for novice investors to get their feet wet, there are some downfalls. Investors can only purchase a portion of a real estate project, which means they own the property along with several other investors — similar to timeshares. In some cases, hundreds of investors might own a stake in a single asset through a limited liability company. Instead of having full ownership of the real estate, the investor possesses limited control over their capital, how it’s distributed and where it’s distributed.

There is no real way of knowing whether the interests of the majority owner are even aligned with the interests of the portion that is crowdfunded. Furthermore, there are potential tax liabilities based upon income charged to the investor without receipt of any cash flow, lack of a secondary market for liquidity and dealing with the requirement of new capital if a cash shortfall should occur. Investor fortunes could be lost, and they could be lost quickly.

As crowdfunding models have become more complicated, a new generation of real estate technology disrupters has addressed some of the shortcomings of crowdfunding with a more holistic funding model, providing protection for investors and helping them build wealth through a combination of cash flow and appreciation.

Firms such as HomeUnion, in which we’ve invested, and OwnAmerica offer investors the ability to buy an entire single-family home or create a portfolio of homes, fully customized to meet their personal investment needs. For instance, my portfolio of homes would focus on cities such as Cleveland and Indianapolis where cash flow is high, whereas another investor may prefer locations like San Antonio and Houston where there is more of a balance between appreciation and cash flow.

The fundamental difference in this next wave of funding platforms is that they support true ownership of real estate. Land is the underlying asset, not a piece of paper endorsing fractional ownership. Additional benefits include receiving significant tax breaks associated with home ownership and investment guidance throughout the entire holding period. In short, investors have complete authority over the decision-making process.

Venture capitalists and individual investors have given this new wave of companies a strong vote of confidence over the past few years. According to Venture Scanner’s portfolio management category, the median funding value of real estate startups globally is $3 million. One of the leading anti-crowdfunding companies, HomeUnion, has raised nearly $23 million in funding from VCs and has closed on the sale of more than $50 million in single-family rental assets since its inception. Similarly, OwnAmerica has traded more than $27 million during the beta phase of its new platform.

As the crowdfunding segment plateaus and the next generation of real estate startups continue to grow rapidly, these companies face a different set of challenges. They will need to manage concerns that investors have about lack of diversification by offering inventory in multiple geographies and across multiple micro-economies, ensure excellent customer service and fail-safe processes for the inevitable eviction of tenants or to prepare for a catastrophic event, such as a fire.

In essence, the experience of buying homes remotely must be entirely hassle-free, as should the ongoing property management and eventual sale of the asset.

As real estate technology continues to improve the benefit for consumers, one thing is crystal clear: The notion of real estate as a hyper-local business has turned upside down since the arrival of these new platforms.

In the U.S., single-family rentals currently comprise 40 percent of the country’s entire rental stock, up from 34 percent in 2005. Individuals own the majority of all single-family rentals — 83 percent — with REITs and other institutions holding the remaining small portion.

Hands-off investing, uninhibited by geography and free of the headaches associated with property management, has completely disrupted real estate investing forever.

Contributed by Dave Sorter, Axiometrics

The expected moderation that occurred in the national apartment market during the past two quarters was the result of many factors – a wealth of supply entering the market, regional economic conditions and unsustainably high rent growth among them.

When annual effective rent growth and occupancy rates decline, it can be difficult to remember that just a few months earlier, the sector was in the midst of its strongest period since at least the start of the Great Recession.

Just as a presidential election is, with the Electoral College, the aggregation of 51 state/federal-district elections, national apartment performance is a compendium of hundreds of metro markets throughout the country. Obviously, larger cities have more apartments and have greater weight in the national averages.

The recent moderation has been largely the result of sharp decline in many of the largest metros in the nation. Some of them, such as Houston, have suffered from economic woes combined with a glut of new supply. Others, such as San Francisco and Denver, also experienced lower job growth near the end of 2015, but had such high effective rent growth that it had to decrease eventually.

And the largest market, New York, has also sustained significant rent-growth decline in the past half-year. Other very large metros, such as Atlanta, Dallas and Los Angeles, have neither increased nor decreased significantly. In fact, no really primary market is in the fast lane of growth.

As rent growth in these metros declined or maintained, however, the metrics started surging in smaller markets. Sacramento has seen an exceptional increase in annual effective rent growth in the past six months, and Salt Lake City has made its way into the top 10 among metros with the highest rent growth. Long Island and Newark are no longer playing second fiddle to the Big Apple.

A look at year-to-date effective rent growth in some of these markets tells the story of how some larger markets have moderated while some smaller markets have strengthened.

San Francisco, for example, combined with Bay Area neighbors Oakland and San Jose to comprise three of the five highest rent-growth metros for much of the first half of 2015. But the chart below shows that, come September, 2015 YTD rent growth for San Francisco apartments dropped from the second-highest figure since the recession to the lowest. As of March, 2016 YTD rent growth also is at a post-recession low.

Denver had a similar end to 2015, finishing with its lowest YTD rent growth of the recovery – though 5.6% was fairly robust. Things were looking the same through the first two months of 2016, with negative YTD rent growth in January, though a strong March rebound moved Denver apartments out of the post-recession basement.

Houston apartments, still sustaining minimum job growth as a result of a weakened oil industry, had negative YTD rent growth in March for the first time since the recession ended. This following a 2015 that beat out only 2010 among the post-downturn years.

Sacramento is on the other end of the spectrum. After experiencing some lean years during the early part of this decade, this metro’s 2014 and 2015 were the strongest of this cycle. This year is on the same track, with March’s YTD effective rent growth for Sacramento apartments some 80 bps above the next-highest March, in 2012.

And while Salt Lake City’s March 2016 YTD rent growth is the third-highest of the post-recession period, it was the highest since 2013 and continued the trend started in the second half of 2015, when the metro avoided the common fourth-quarter dip and climbed to tie for the highest year-end rate of the decade for Salt Lake City apartments.

With annual effective rent growth either declining or relatively stable in most major markets over the past half-year, it follows that the national market would mimic that trend. The smaller markets are somewhat offsetting the moderation of their bigger brothers and are on pace to continue to do so, as national rent growth is forecast to average 3.5-4% this year.

Dave Sorter

Dave Sorter is an award-winning journalist who spent 30 years as a newspaper reporter and editor before joining Axiometrics. He oversees all Axio blogs and newsletters and serves as senior editor of all Axio publications.