At Jake & Gino, we have created a three-step framework on how to invest in multifamily: buy right, manage right, and finance right.
We use the analogy of a wheelbarrow, where the two back legs of the wheelbarrow are buy right and finance right. The wheel of the wheelbarrow signifies the manage right portion because this part of the framework is in constant motion, whereas the buy and finance portions are fixed once the investor executes them.
In this article, I am going to focus on the manage right portion, and more specifically, how to rent an apartment quickly for top dollar, what mistakes to avoid with your marketing, and the five-step leasing process that will ensure your success when advertising your apartment to prospective tenants.
Let’s begin with the five-step leasing process:
1. Greet the prospect
This is the initial stage of the customer experience, and as we have all heard countless times, first impressions are vitally important. A tenant can make a decision within the first few seconds of entering the leasing office if they want to sign a lease and live in your property, or turn around and never be heard from again.
RULE #1: Have your leasing agent get out of the chair and come and greet the prospect with a warm smile and a friendly handshake.
I always try to put myself in my prospect’s shoes. How would I feel if I entered the office and the leasing agent was staring at their computer screen chewing a piece of gum and ignoring me? Not good! Your goal is to make the prospect feel important and feel as if you are there to serve their needs.
Rule #2: Answer the phone within three rings, and if the call goes to voicemail, make it a priority to call back the prospect within an hour. Your chance of converting a prospect whose phone call was not returned promptly drops precipitously every hour that they wait for a callback.
2. Determine the prospect’s wants and needs
Once you’ve established rapport with the prospect, it’s time to keep your mouth closed and listen to what the needs of the prospect are. Are you dealing with a prospect who is a single dad who has his daughter over every other weekend, or is the prospect wanting to use the second bedroom for an office? Does the prospect enjoy living on the second floor because they feel safer, or do they have problems with climbing stairs?
This is the phase where you need to establish the customer’s needs and try to deliver based on their needs. The single dad would appreciate an apartment with an additional bathroom for his daughter, so if you can direct him to his need, your success rate will skyrocket and you will save yourself time in the process (no sense in showing him one bed.)
3. Select and build value in the unit
Once you have established wants and needs, proceed to select a unit and building the value in that unit. The conversation should go “ I’m going to show you this unit on the second floor with a smaller bedroom. It has what you are looking for. Does it match your criteria?” And then, proceed to that unit.
What you have done is listened to the prospect and directed him to what he needs. You have also saved time by not showing him three other units that do not fit his criteria!
4. Make the proposal to the prospect
Armed with a pad and sharpie, begin to write down what the price of the unit is, and any comments that the prospect is saying. For instance, he may comment on the great price, the size of the units, etc. The amazing thing with this technique is that you are generating an offer to the tenant, even though there is no “contract”. You can point to your pad and highlight what you have just written down. Subconsciously, you are closing the prospect in this stage.
5. Close the prospect
The last step is easy. Just walk down to the office and proceed to close the prospect. If you walk them through the entire five-step process, you will eliminate the majority of objections from the tenant. Your close rate will rise dramatically, and so will your NOI!
Now, let’s move on to two huge mistakes that moms and pops commit when trying to lease their apartment for top dollar.
The first mistake is not having a website to direct the traffic to, and if they do, the website is confusing or poorly laid out. This is our property management website – Rand Property Management.
Some distinguishing features: The website is easy to navigate, has quality pictures, phone numbers for the office are easy to find, and the tenant portal is also simple to use. The number one priority of the website is to have prospects land there, decide the complex fits their criteria, and pick up the phone and call the leasing office. Voila! That’s it, job done!
The second mistake that moms and pops commit is that they utilize social media to rent their apartments and spend thousands of dollars uselessly on advertising. Let me ask you a question. Where would you search on the internet if you were searching for an apartment? The vast majority of prospects will perform a Google search, such as “Rent a luxury apartment in Knoxville.”
Social media platforms, such as Facebook and Instagram, can be utilized to build a brand or customer awareness, but unfortunately, when a prospect needs to rent an apartment, the search needs to happen instantaneously and Google is overwhelmingly the preferred method.
So save your money, create a Google ad campaign, and decide when you want to advertise your unit. Or better yet, hire a company to help you create an ad campaign.
DISCLAIMER: This article expresses my own ideas and opinions. Any information I have shared are from sources that I believe to be reliable and accurate. I did not receive any financial compensation for writing this post, nor do I own any shares in any company I’ve mentioned. I encourage any reader to do their own diligent research first before making any investment decisions.
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