Are you looking for ways to make your apartment community more efficient and effective? This is the final article of our Apartment Vacancy Analysis series, which will help you find and fix the gaps across the marketing and leasing chain, and offers practical strategies and tools to help take your apartment community to the next level! Access the full table of contents available below.
Throughout this series, we've pinpointed how to conduct a vacancy analysis across every critical point in your marketing and leasing chain— a.k.a the typical apartment resident's lifecycle—to help pinpoint any weaknesses in your property management's operations.
Now, you're probably wondering by this point, "What about my pricing?"
That's why we've purposefully saved this section for last.
🤕 Problems & symptoms that your rent prices are wrong
Your Website Visit-to-Lead Conversion rate is way too low.
Does it take a ton of visitors just to generate one lead from your website?”
As we discussed earlier in this series, the content and performance of your website matter—and certainly impacts the visit-to-lead conversion rate.
But if you're following best practices, then pricing could be to blame.
First, check and make sure that you're displaying clear, actionable rent pricing on your community website. As stated before, showing one price is the easiest way for a prospect to determine affordability.
The next thing to consider is if your prices are too high.
The Average Ready Days to rent each unit is too long.
You can also conclude pricing is too expensive if the Average Ready Days to rent each unit is high in addition to your website visit-to-lead conversion rate.
If both of the above metrics seem 'off,' pricing is part of the blame. And it may not just be high prices, either. The other problem is you're not changing prices enough or applying targeted specials on struggling units or floorplans.
🤦🏼♂️ Common mistakes multifamily operators make with their renewals
You set rent prices well below the market rate.
If your rent prices are too low, it masks any other issue in your operation because you'll have no problems attracting prospective residents and keeping occupancy rates high.
Renters will want to rent from your community because your rents are much cheaper than other properties.
Lowering rent prices minimizes your revenue capacity and can leave you operating blindly, not addressing any lingering issues that could hurt you in the future since you do not see many vacancies occur presently.
You set prices too high.
If your pricing is too expensive, any efforts to establish excellence across your operational chain are meaningless.
You'll never be able to control vacancies if current and future renters always have the option to lease from similar, more affordable communities in your local marketplace.
The real problem in both scenarios? Pricing is guesswork and not set using your community's actual demand or renter behavior.
🙌🏼 Best practices for setting rent prices
Have a well-defined apartment pricing strategy.
Do you want to increase occupancy, rents, or a combination of both?
Whatever is best for your community, your pricing strategy must reflect that.
That's why you must choose a pricing strategy that reflects your community's revenue goals and stick to it. It will help you avoid setting rents too high or low as well as determine how aggressive or conservative you want to be when changing rents or using specials.
Set a pricing cadence that works for you and your renters.
Whatever your goals are, it's critical that you change your community's rent prices systematically to avoid problems.
Changing rents too often confuses renters and turns them away because they're seeing new prices everyday.
But waiting too long—only changing prices once a year or quarter—can leave your rents out of sync with demand.
🛠 Tools to help improve your apartment's pricing
Invest in revenue management software.
Setting prices manually is both time-consuming and prone to guesswork. That's why investing in multifamily revenue management software that helps you set prices according to your goals can help.
RentVision Revenue Management automates unit pricing that's tuned to each community's goals using only your own supply and demand data. It also makes weekly, incremental price changes, helping you stay in front of demand changes while not overwhelming renters, as well as automates specials for struggling units and floorplans.
Complete Apartment Vacancy Analysis Series
Introduction: What's causing your apartment's vacancy? Here's how to find & fix it
Part 2: Is your apartment's renewals strategy causing more vacancy?
Part 3: Are your residents satisfied with their experience at your apartments?
Part 4: Are you accruing excess vacancy loss after units lease?
Part 5: Are you properly vetting your apartment's lease applications?
Part 6: Is your apartment's application process to blame for vacancies?
Part 7: Are your apartment tours helping overcome vacancy?
Part 8: Do you have enough 'good' leads to improve apartment leasing?
Part 9: Is your apartment website converting leads to leases?
Part 10: How qualified is the traffic to your apartment website?
Part 11: What about pricing?! How rents affect your apartment's performance