What’s the story with all the FREE rent being offered in London? Have we all just decided to drop our pants instead of marketing? My position in this article may not be popular, but I’ve worked too long in this industry to stand on the sidelines and say nothing. Truthfully, that’s not my make-up anyway.
FREE rent creates a lot of problems. First, it lowers the revenue on the building. With less revenue there are limited funds for improvements. With FREE rent you always draw in people who can’t afford the rent in the first place and just need a place to hang their hat until the next FREE rent deal comes along. Then there’s another vacancy a year down the road when you try and renew the lease, then you start the cycle all over again. When FREE rent is an expectation in the marketplace, then we’re all subject to customer control. Don’t you want some say in how you do business?
So what is it that will induce people to pay more money? Better service! Better communication! Better accessibility to management! Residents are sick and tired of voicemail, of having to plead with landlords to complete a modest repair and to be uninformed about things that are being done in their building. How you do it is up to you, but an interactive website where tenants can complete an application or a work order online is a start. It doesn’t matter if you have 20 units or 200, there are lots of viable options available to improve your level of service. Of course, many of us think we already provide good service. However, having conducted resident satisfaction surveys in resident communities across Canada, I can only say that often what we think and what the customer feels are two very different things.
People will pay more for better suite finishes and tastefully decorated common areas. It’s time to install vertical blinds, new countertops, vanities and mirrors in your suites. If you’re still using brass fixtures then switch them to brushed nickel or chrome, even pewter. Gold is out – silver is in. Are you using round knobs on your door handles or lever handles? Have you updated the electrical outlets and light switches? These are not expensive items but they are the difference between the haves (full house) and the have nots (vacancies). Quit throwing your money away when all you really need to do to beat competitors is to institute a few improvements that cost less than the free rent you’re offering.
And finally, work on amenities and services. What do you have for takeaways for prospective residents? Are you using three-dimensional floorplans? Do you have community information sheets? Do you ensure that everyone who comes to see your property has a positive experience from the first time they step into the unit through to and including the day they move in? We firmly believe that a happy move-in experience will result in a happy tenancy. Work on making people happy because if they’re happy, they’ll stay. Too many times we forget about our residents as soon as they sign on the dotted line. That’s a major downfall and it’s as bad as throwing good money right out the window.
I’ve worked in this industry for 28 years and I can count on one hand the number of times I’ve offered free rent. Even then, it was usually under pressure from the landlord. You can keep a building full without it. At the present time, we’ve got dozens of buildings that have zero vacancy with incredibly modest investments in advertising. How do we do it? We believe we’re in the happy people business. If we keep people happy we can keep buildings full without the fuss and bother of giving money away. Our residents want to stay and will pay to do it! Now that’s good marketing. Try it! At this point what have you got to lose?