As an independent landlord who self-manages a portfolio of rental properties, you probably don’t outsource the job of filling vacancies to a property management company.
Unlike a property management company, you are the manager AND the owner. This means you control the marketing strategies and are directly impacted by their success or failure.
The best marketing strategies are designed to find the highest quality tenants—people who pay rent on time, treat the unit and property as if it were their own home, and are courteous to the neighbors—in the fastest possible time.
Finding high-quality tenants makes your life easier as a landlord and puts more money in your pocket. You’ll have more qualified leads, less turnover (and lower turnover costs), fewer evictions, and less late rental payments. Finding these tenants faster reduces your vacancy loss. By filling vacancies yourself, you eliminate the lease-up fees, new lease fees, and ongoing fees charged by a property management company.
How can you find the highest-quality tenant in the shortest period of time?
Now the question is how to find the highest-quality tenant in the shortest period of time without spending all your time marketing your vacant units?
As a result of building a portfolio of over $400 million in apartment communities, I have identified 13 creative marketing strategies to attract high-quality tenants:
1. Advertise on the internet
Eighty-seven percent of renters search for their homes on the internet, so an online presence for your rental properties is a must. Start by creating a website (or at least a Facebook page). Then post your listing, and market the listing on social media sites like Facebook, Twitter, and Pinterest. Next, all of your “for rent” units should be listed on popular online rental listing services like Cozy, Apartments.com, Craigslist, Realtor.com, Trulia, and ApartmentFinder.com. Make sure your listings include a clear and accurate description of the unit and property and highlight major selling points. It’s also a good idea to invest a few hundred dollars into having professional pictures taken.
2. Hire locators
A locator is a rental agency that specializes in helping prospective tenants find their ideal home based on their needs. These are great sources for finding high-quality residents. The fastest way to find the locators in your market is on Google. The standard commission is 50 percent of a month’s rent, which is less costly than a property manager’s fees. If you decide to hire a locator, make sure you provide them with weekly updates on your current availabilities.
3. Partner with a real estate agent
You can partner with your real estate agent agent to advertise your rentals on the MLS. Realtors usually charge 50 percent of a month’s rent as a commission. This is a great way to build rapport with your real estate agent and ideally become their go-to investor for their pocket listings and off-market opportunities.
4. Use corporate outreach
Most major corporations have someone whose sole responsibility is to place employees who are relocating to the area into new rentals. Contact the human resources department of the major employers in your market. Ask for the contact information of their relocation specialist.
5. Target local businesses
Create a list of local businesses, employers, schools, bus stops, train stations, etc. to target your marketing efforts based on your renter demographic. Then, to generate leads, print out and drop off fliers, business cards, price sheets, floor plans, and site maps to these targets. Always ask for permission first.
6. Negotiate discounts with target businesses
Another approach is to negotiate discounts at local eateries, salons, fitness centers, etc. for your tenants, and then leverage those discounts when marketing your rental listing. The local business gets more customers, and your tenants get access to local businesses at discounted prices, so it is a win-win.
7. Build a referral program
Fifty-seven percent of renters search for a home through referrals from family and friends. To capitalize on this, incentivize your tenants to provide referrals. One approach is to offer cash to any tenant who provides a referral. A fee of $300 paid 30 days after the execution of the new lease is standard. To advertise the referral program, deliver notes to your tenants’ doors, and send out friendly emails with the details of the referral program on a monthly or bimonthly basis.
8. Provide a free gift to target business employees
Similar to the referral program, send a small gift such as a gift card, gift basket, bottle of wine, toolkit, etc. to the current tenants who are employed at the businesses on your target list. Thank them for their residency, and ask them to refer your rental properties to their colleagues at work.
9. Hold tenant appreciation parties
To promote resident satisfaction and retention, host tenant appreciation parties a few times throughout the year. Examples are to provide a small to-go breakfast; host a wine night; host a timely or holiday-themed event, like a Valentine’s Day card-making party; holiday gift wrapping session; back-to-school barbecue; or a Halloween costume contest. Be creative!
10. Encourage online reviews
The online rating of your properties will likely be the first thing a prospective tenant looks at during their rental search. Organic reviews are great, but you should also be proactive to increase your number of reviews. One strategy is to ask a resident for a review after fulfilling a minor maintenance request (probably not a good idea if it was a large maintenance issue) in a timely fashion. Or have a laptop station set up at your tenant appreciation parties and ask them to write a review before they leave.
11. Contact exiting tenants
Call all tenants who have previously notified you that they plan on leaving at the end of their lease to figure out why they are leaving. See what you can do to convince them to stay (assuming they are a high-quality tenant). Maybe they want to move to a different unit or want a minor upgrade, like an accent wall or new curtains. Also, explain to them the costs associated with moving out (new security deposit, hiring a moving company or U-Haul, cleaning costs, new furniture, etc.). This conversation should take place at least 60 to 90 days prior to the end of their lease.
12. Follow-up with old leads
Reach out to leads you received that are older than 90 days to see if they or someone they know is still searching for a rental.
13. Offer good customer service
Provide stellar, good old-fashioned customer service to prospective tenants. Be responsive and timely with requests and questions. It doesn’t matter if you’re a marketing wizard and get hundreds of leads if you don’t pick up the phone or respond to emails quickly, politely answering questions, and getting possible tenants one step closer to viewing the property and signing the lease.
All 13 of these strategies have been proven to attract the highest quality residents in the shortest amount of time without the help (and costs) of a property management company.
Some of these strategies are free and just require some sweat equity on your part. Others require an upfront investment and/or result in a short-term reduction in income. So it’s important that you create a marketing strategy and set a marketing budget before closing on a deal. That way, you can account for the costs in your underwriting.
Tags: Property Management