Anyone Can Lease Apartments

If you can read this, you can lease. If you have the desire to, you can lease. If you learn, practice and apply the necessary skills, you can lease! Leasing is just like riding a bike, playing tennis, and swimming, using a computer or any other skill that can be acquired. You can learn the skills necessary to be a successful leasing professional, and I promise that it isn’t even as difficult as it might appear!

Succeed with Confidence

When you rode a bicycle for the first time, you might have been afraid of falling and scraping your knees on the sidewalk. When you entered the   swimming pool for the first time, you might have been afraid of going under. When you took your first tennis lesson, you may have become frustrated because it wasn’t as easy as it looked. The first time you sat in front of a computer you may have been afraid that you were really going to mess something up or make some important bit of information disappear forever. Once you learned, practiced and applied the new skills that each of these pursuits required, you found out that they weren’t as difficult as they appeared at first! You learned that if you fell off your bicycle, you didn’t break into pieces. After a couple of gulps of pool water, you learned that if you relaxed a little, you could float and then actually swim! The same will hold true in Relationship leasing. You’ll find that even if everything goes completely wrong on some of your early attempts, you can pick yourself up and go on to make a great leasing presentation with the very next future resident!

Practice Makes Perfect

In learning to ride a bicycle, swim, play tennis, or use a computer, you probably developed the basic skills fairly quickly, and with a little practice, then became quite comfortable with the new activity. The same will hold true with relationship leasing. If you learn proven techniques, practice and apply, you’ll become very comfortable leasing in no time at all!
Of course, it’s also necessary to put those acquired skills into action with the right attitude. I’ve found that the perception of leasing as a “sales” business and the negative stereotypes attached to sales as a profession can make it difficult for leasing professionals to place themselves in a positive and confident mindset. The word sales makes many of us think of fast-talking used car sales people or some guy on TV selling snake oil, using every trick in the book to talk people into buying a car or gadget that they don’t really want at a price they can’t afford! In fact, sales has gained a  pretty bum reputation over the years - great news for comedians and movie producers, but not so great for a sales professional’s self-image. Fortunately, there is absolutely no need to use fast talk and gimmicks to be successful in leasing apartments.
This series of articles is going to show you how to use the opposite approach — integrity, honesty, and an attitude that conveys a willingness to help the future resident — to show you not only how you can increase your closing ratio, but also how powerful this leasing strategy truly is. I’m not suggesting that you merely pretend to help the future resident or to be their best friend. I’m proposing that if you simply treat the future resident just the way you would want a salesperson to treat you if you were looking for an apartment, you’ll realize an immediate increase in your closing ratio, and will be well on the way to achieving your personal best!
The golden rule is only one important ingredient in leasing success, but the others are no more complicated. In this book you are going to learn that Relationship Leasing is the easiest way to succeed at increasing your closing ratio. You will learn how the Resident and the Future Resident’s needs and wants can actually help guide you through the leasing process. In addition you will learn how to work with the future resident as the most valuable key to closing the lease, instead of against the future resident as an opponent who must be “sold”.
I can just hear you thinking to yourself right now, “If this relationship leasing technique is so great then why aren’t more leasing professionals using it?” The answer is very simple: most of us don’t begin our careers that way, and the skills and philosophies that we absorb earliest in our training, when we are most impressionable, are those that tend to follow us for the remainder of our careers. Most of us begin our leasing careers focused on ourselves and our own performance - doing all we can to just get that lease! Instead of focusing on the needs of the future resident, you probably spent the first several months of your leasing career thinking I need to get all the information on this guest card or my supervisor is going to get mad at me. Can I  get them to visit the community? Will they like what I show them? Can I convince them to lease? Can I even do this at all?
Once this initial fear has passed, new leasing professionals then tend to focus on the apartments, community and services - still largely missing the needs of the future resident. “Let me tell you about our great community.” “Our service is better than the competitions.” “ We have ______ & _______ & ________ and our competitors don’t.” The truth is, our future residents don’t care if we need to fill out guest cards or what you perceive to be your competitors’ shortcomings. They are much more interested in finding out if your community offers what they’re looking for in a new home, including the lifestyle that they expect or aspire to.
Don’t just think about the features and benefits of your community. Put yourself right in the resident’s shoes. What living solution can you really provide to them? What are your apartments and community going to do to make their apartment living experience better? And also, why should they even listen to you? In the remaining articles you will learn how to totally focus on the future resident; how to adopt the future resident’s perspective; how to build the future resident’s trust; how to get the future resident to not just be willing to listen to you, but to want to listen to you, and even to guide you right through the entire leasing process. We will also review each component of the leasing process in great detail and show you how you can put the relationship leasing approach to work. This article has been provided to give you a quick overview of the entire process. We’ll begin by addressing the basic steps involved in presenting your community to future residents. We’ll continue with a list of questions that we intend to answer along the way, with the ultimate goal of helping you to become the very best relationship leasing professional you can possibly be!

Are your communities hearing from friends, coworkers and family of former residents? You should be, but it takes a powerful referral strategy to make that happen.
Imagine this likely scenario:  John Doe leased an apartment, and two years later, he purchased a home. Two months later, his brother called to find out about an apartment, and signed a lease.  Not long after, a co-worked called to find out about a 2-bedroom apartment, and signed a lease.  That co-worker has a family, and friends, and other co-workers, and so the chain continues.
The moral of this story is that the best new business comes from old business; but referrals don’t happen all by themselves.  They’re the result of a great referral strategy that’s founded on building great relationships with your residents.
Is your focus on devoting the best possible service to your residents?  Are you making meaningful contact with them, and actively managing that relationship to make sure that it stays strong and positive?
We’ve heard from thousands of successful communities who continually receive referrals because they understand that to receive the best possible benefit of bringing a new resident into your community – i.e. leasing an apartment, retaining that resident, and encouraging them to help you find even more great residents just like them – you have to not only lease an apartment.  You have to build a strong and positive relationship.  Here are a few relationship-building tips to help you fine-tune your referral strategy!
1.  Develop a plan. In order to make your relationships yield the most (and best) referrals, you’re going to need a plan.  A referral promotion is a great way to remind your residents, and even previous residents, that you’re looking for others like them.  This includes regular reminders to not only your residents, but also to previous residents.
Action:  We’ve heard from communities who say they’ve received the best referral results by posting and distributing quarterly reminders to their residents, local employers, relocation companies, locators, and human resource departments; and sending bi-annual cards or postcards to previous residents.  It doesn’t have to take more than an hour or so per month, but make certain that your plan includes emails, phone calls and handwritten notes.  There’s no substitute for the personal touch.
2.  Be a Resource. The most successful communities implement this ideal across the board, whether they’re serving someone who just called in a phone inquiry, or a long-time resident.  It’s also one of the most impressive ways to set your community apart from the crowd.  Know all about your neighborhood so that you’re armed and ready to provide the absolute best, on-the-spot service, information, and advice.  Toni Blake calls this the “Village” approach, because your community borders aren’t the end-all and be-all of the lifestyle that you offer.  That park around the corner, fabulous café down the block, and the farmer’s market that’s within walking distance are all part of what makes your community special enough to refer others to!
Action: You don’t necessarily need a community concierge to serve as your one-stop information source.  Providing information is a job that can be shared among your team, or it can even be the passive function of an “information directory” that sits on the coffee table in your leasing center.  Just research, gather, and keep as much information handy as you can – menus, brochures, flyers, coupons, business cards, price lists, maps, schedules, phone books, you name it – for whomever might ask.  Share this information with your residents as actively as you can, because the more they know about and use the resources around them, the happier they’ll be as a resident of your community, and the more likely they’ll be to invite others in!  Don’t be afraid to ask the other businesses in your “village” to help you spoil your residents with coupons or gifts – every new resident in your community is a new customer for them!
3. Exceed Expectations. Speaking of ways to set yourself apart from the crowd, let’s talk about how to not just make a resident happy, but blow their mind entirely.  Providing great service is fundamental to your success, but honestly, residents expect great service.  When you exceed their expectations by providing superior service or outstanding attention to detail, it makes an impact on their relationship with you that’s tough to beat.
Action: It’s surprisingly easy to do.  Just imagine the appropriate response in any situation, then go one better.  Don’t just say thanks - once in a while, send flowers.  Don’t just file the finished paperwork - call personally to follow-up.  Don’t just smile – give them a compliment and call them by name.  Residents are most inspired to tell others about you when your resident-retention efforts (especially where service is concerned) exceed their expectations in at least one of the following ways: by providing service in ways that are faster, more convenient, and possibly fun, or with some added-value benefit your competition doesn't offer. You're certain to stand out from any competition when you are the first community to provide some of these points of difference. Competitors who institute your "extras" will be copycats, playing catch-up to you. Once you have accomplished this, you can inspire residents to refer their friends and colleagues to your community. By doing so, they can gain "bragging rights" for showing others what a wonderful community they live in… YOURS!
4. Keep it up. Your relationship with resident doesn't end with the signing of a lease. It’s just beginning.  Make sure they know that you’re in it for the long haul.  You and your team are there for them, whether they have a maintenance issue or just need to know which dry cleaner can get a red wine stain out of a silk blouse.
Action: Start big on day one. Don’t underestimate the impact of pizza or sandwiches and cold sodas on moving day.  Put toilet paper in all of the bathrooms and paper towels in the kitchen.  Leave a bag of ice in the freezer or turn the icemaker on and leave a card that lets them know that it’s fresh ice.  One of our favorite tips is to place a sign in front of the closest parking space for 48-hours that reads “This space is reserved for the next 48 hours for your new neighbor”.  Make sure that the things that you do are supporting the relationship building process.  Take a close look at your move-in gifts, and if they’re not making move-in easier, or enriching the experience of living in your community, make some changes now.  Now, here’s the tough part.  Don’t wait until their next big event to make that same kind of a great impression, like when they have their first maintenance emergency or worse yet, when renewal time rolls around.  KEEP IN TOUCH!  Call within 48 hours after they have moved into their new home and ask for feedback.  Send a note after they have lived in the community for 2 weeks; contact them again with a note or by phone in three months, and then call or write again three months later.  Each note, card, or reason for calling should convey the message loud and clear that they’re appreciated, and that you care enough to make sure they’re happy living in your community.
5. Create a sense of community. Mailings and phone calls can make a positive impact on a resident, but nothing like the overall experience of being a part of your community.  The best thing about building a sense of “neighborhood” among your residents is that you don’t only have to rely on the things that are included within the confines of your community.  You have, as a rich resource, the resources, character, and offerings of your surrounding area.  Build ties between your community and the surrounding area in order to build and strengthen your presence within your marketplace.  This not only makes your residents feel like real neighbors instead of co-inhabitants; but it makes your residents, surrounding neighbors, and local business establishments more aware of your presence – and more likely to refer others!
Action: Get out there and meet, greet and get to know the businesses in your area.  Remember, more residents for you means more customers for them.  Even your competitors might be willing to work out a referral arrangement, provided it’s a mutually beneficial one.  Meet the people who make their homes in your neighborhood!  Host holiday parties and seasonal events that are open not only to residents, but to the surrounding community.  Work at least one charity event into your schedule that benefits a local organization.  Plan resident appreciation events that capitalize on your community involvement (i.e. a plant sale that includes a “Patio of the Quarter” contest).  Is it worth the time and dollar investment?  You bet!  Building great relationships doesn’t cost.  It pays… in referrals and more!
6. No matter what it is, do it right – preferably the first time. There is an old adage that we have heard time and time again “you never get a second chance to make a first impression“.  No matter what your residents need or expect, do it right.  Here’s the rule:  give your residents great reasons to refer, and never give them a reason not to!  Why are people more likely to tell others about a bad experience than a good one?  Because bad experiences make BIG impressions.  When your actions and your efforts to prove to residents that you care about them and their home make equally BIG impressions, you can bet they’ll tell their friends, relatives and associates.
Action: From the very start of the relationship building process, listen carefully.  Get the correct pronunciation of their name.  Understand their wants, needs, and concerns.  Make the move-in easier.  Keep in touch.  Fix it when it’s broken.
7. Come right out and ask. There are two schools of thought when it comes to asking for referrals.  Many people feel that it’s a good policy to never overtly ask for a referral, because it makes a resident or previous resident feel used, and nobody wants to be used.  The other school of thought feels that happy residents should be happy to contribute to your success; and that it gives them a sense of ownership to know that they have an influence over who might become their neighbor in the future.  We hold with the second school of thought.  Happy residents will be more than happy to volunteer a referral, if asked… but like all things worth doing, there’s a right way to go about it.
Action: Make it without question that your reason for keeping in touch with your residents is because you genuinely care about them. You want them to be satisfied not only because it’s in your best interest for them to stay, but truly because you want them to have a home that they’ll always be happy with.  Do that first, and do it well; and while you’re at it:  once in a while, put out a referral door hanger; mention in every newsletter that referrals are always welcome; offer a reward if the local law allows.  Make your request for referrals something that you do in addition to relationship building; not in place of it.
8.  For heaven’s sake – don’t forget to say thanks! A resident who is willing to refer others to your community is an invaluable resource, so treat them that way!  Showing appreciation is not only the appropriate thing to do when somebody helps you close a several-thousand-dollar sale, but it’s the key continuing to receive referrals. Even if you pay a referral fee, send a personal thank you note.Even if they don't lease the apartment you need to call to say thanks and let them know how the meeting with their friend, family member, or associate went.  Make a big, appreciative fuss about the wonderful thing your resident has done.  Send flowers, buy a gift certificate for lunch, or give tickets to a show or athletic event; and if you find yourself asking whether the added expense of a thank you gift is really necessary, stop to consider the lifetime value of a happy resident, not to mention one who continues to refer others! The current consumer trend is to reward your residents with a memorable event that they want to tell even more people about. An example of this would be to give them tickets to a "backstage" event. This gives your resident bragging rights about your community.

Here’s one great example of a program that you can use to improve the performance of your referral strategy!

Replace Yourself Program
Contributed by Sara Soleymani

Congratulations on the purchase of your new home!  Do you need some extra cash for closing cost or moving expense? All you have to do is refer a friend to Arlington Park to rent your apartment home.  If your friend leases your apartment home you will receive a check for $000.  It's that easy!!!

Here’s how the program works:

1.    The prospect must tell the leasing associate on their first visit that you referred them.
2.    They must lease your apartment home before you move out.
3.    You must give proper notice according to your lease.
4.    You must provide proof of purchase of you new home.
5.    You will receive your check for $000 at your new home within thirty days of your friend moving in.  Don't forget to leave your forwarding address.

See, I told you it was easy!  If you have any questions, please call the leasing office at 555-5555.

*This program expires on <Month> <Day> <Year>.

“An Alternative Marketing Source—Increase Occupancy and Rental Income Simultaneously.” By Diane Steele

There is a lucrative market of potential renters searching for a property just like yours to live at-- the corporate business market.

You may think businesses primarily rent corporate business apartments from communities that are large, have a corporate leasing team, or are a luxurious new property. This is not the case. In reality, if you can offer business clientele a clean apartment, superb service, a convenient location, affordability, a shorter lease term (usually 3 months minimum) and a commitment to making the relocation process go smoothly for all involved, you have what it takes!

In this economy, companies and businesses are searching for ways to reduce housing expenses for their temporary consultants, transferred and short term employees. In many cases, businesses have used hotels for their housing needs. Hotels charge businesses a negotiated per night rate of approximately $79-109, or $2,370 - $3,270 per month, depending upon the market.

If you take a moment to calculate what you could charge for a corporate apartment in your community and compare it to the cost of housing at hotels, the cost savings for corporations could add up to hundreds of dollars per month. It could also add up to hundreds of dollars in additional rent you could add to your property’s bottom line.

To establish a basic corporate apartment, you will need furniture, housewares, electric, telephone (with a long distance block), and cable. (There may be additional utilities or items specific to your community you will need to include.) Below is an example of expenses you will incur on a monthly basis for each apartment using this example.

Market Rent        $900
Furniture            $140
Housewares        $35
Electric            $25
Cable                $45
Misc                $50
Total                $1,195

Now here is where your company can make a substantial profit.  Compare the monthly rates companies are paying at hotels per month ($2,370 - $3,270) to the above estimated price you need to charge for a corporate unit ($1,195.)  The difference between the two is at minimum $1,000 per month. There is a lot of room for you to add a corporate premium to your rent after you cover your expenses. Adding the corporate rent premium would increase your rent and at the same time save companies hundreds of dollars in housing costs per month.

Surprisingly there are additional benefits to your community other than increased rent. Some of the benefits may include;
1.    Easy and inexpensive turnover costs- Many of your corporate clients secure permanent residency in other parts of the country and live in their apartments on a part time basis. Therefore, wear and tear on the apartment is far less than with a normal 12 month apartment lease. (I have experienced this type of turnover to consist of a light touch up paint, carpet shampoo, spot cleaning and changing of the locks.)
2.    Repeat Business and Referrals- After you have established a solid client base with local businesses, you will create a bond in which they will continue to call upon you with their corporate and business housing needs. You will also have established contacts between vendors, other communities and relocation establishments that will also refer corporate clients and businesses to you.
3.    Increased Occupancy- You will increase your occupancy by filling apartments with business clientele vs. holding a vacant unit. You will also have the opportunity to convert short term leases into long term leases. Although some companies will initially ask for a 3 month lease, many often choose to renew several times afterward. In some instances, the apartment lease converts into a 6 or 12 month lease where the employee decides to relocate or is permanently placed in the area.

This all sounds great, but how do you know if this is right for your property? Where do you start?  What do you charge?  Well, you need to do some of homework. Here are a few places to start:
1.    Call all corporate apartments in your neighborhood and surrounding area for prices, amenities and ideas. This will give you a feel for the market, what is available and what you need to offer to be competitive. This process will also give you a good idea of your property’s potential price point.
2.    Call a few local hotels and ask what they charge for a 30 day stay or longer. Make sure you contact the extended stay hotels that cater to this type of corporate housing need.
3.    Make calls to your necessary vendors (furniture rental companies, cable, etc.) to help you determine your overall costs. Remember to calculate installation and delivery charges into your costs.
4.    Think about the type of apartment you have the largest inventory of or the type that is the hardest to move. This may be the apartment you feature for this situation.
5.    Determine the number of apartments you are willing to rent on a possible short term basis at any given time of the year. You need to be careful here and remember to diversify your units. As you need to stagger the months your leases expire on your long term leases, you do the same with business corporate units. Resist the temptation if you come across it to move 25 corporate apartments in the same month and face the same 25 vacancies in three months. This is a formula for Short Term gain and Long Term stress.
6.    Determine your competitive corporate rate. Make sure you are comfortable with this price and that others are willing to pay it. Ask for feedback from those you know in the apartment referral business about your program. They will be honest with you and let you know if they could send potential renters their way.

Now that you have a good idea of what you should charge, where do you find people to rent your apartments? Here are some quick ideas:
1.    On a map, circle a 5 mile radius around your property. Take a few hours from your day when it may be slow and drive around to all areas included within this 5 mile radius and write down as many businesses as you can think of that may have housing needs. Look at both small and large businesses. Contact those businesses either by telemarketing or person cold calling. You can start with HR or any administrative assistant who may make housing arrangements for a company. Remember to ask for referrals if they don’t have any needs.
2.    Go through your resident apartment files and determine where most people currently work. Pay special note to any residents who may be consultants or in IT. There is huge potential here.
3.    Inform all of your vendors and referral services you are offering corporate apartments. Prepare a flyer with all of the necessary information for them to refer to in the near future.
4.    Send out a letter to your current residents informing them of the corporate business apartments now available at your community. Offer a one time referral fee to anyone who refers their company to your community that ultimately results in a rental for you.

You have the opportunity to save companies money and offering their employees a comfortable home away from home. Companies are waiting for you to offer your property to them and rescue their employees from the four walls that are slowly closing in on them in their hotel rooms. (I moved an employee into an apartment after living in a hotel room for 3 years!)

With a little research and a little more work, there is great potential for you and your company to increase rent and occupancy simultaneously. Good luck!

Diane Steele is a sales and marketing professional located in the Minneapolis/St. Paul Minnesota area. She has worked in property management and related fields since 1988, specializing in increasing sales and occupancy quickly, corporate housing and property evaluations.

There comes a time when we decide it's time to stop giving away free rent and the competitors aren't on the same page. I wrote this article to help you and your team make the transition.

Here’s how it started.  A future resident at my apartment community sent an e-mail to his leasing professional.  He’d recently toured the community, was extremely interested, and had a couple of questions about the community’s technical features.  He also mentioned that he wondered why our community wasn’t offering a special incentive, since the others in the neighborhood were giving away as much as two months free rent… he was still impressed and interested, but choosing our community wouldn’t be as easy to justify.

The apartment leasing professional gave the matter a great deal of thought, then forwarded the gentleman’s e-mail message to me, having added a rather convincing case for us to consider offering concessions too.   Instead, I responded with all of the reasons why, in my experience, it’s far better to avoid concessions at all cost than to succumb to them.
Our future resident, and the Leasing Professional, had a seemingly valid point.  They needed a better understanding of why I continued to stick to our rental rate when our competitors were giving their apartments away for free.  The crux of the matter is that our future resident and our Leasing Professional were posing an objection.

Why is it really important to avoid concessions?  There are plenty of answers, but they all boil down to one basic principle – the desire for a concession is really just an objection… and objections can be overcome.

Why do Future Residents Object, Anyway?

An objection is defined as any obstacle, however slight, that stands in the way of and prevents a signed lease.  Naturally, our goal is to remove obstacles, but objections must be understood before they can be removed.

Life can be pretty complicated these days.  Everything is specialized and customized.  Whatever we may want, we can almost always choose from several varieties of it.  Now that’s all well and good, but if you’ve ever wasted twenty minutes in the shampoo isle, then you know that choice is a mixed blessing.  How do we know that underneath all the splashy colors and shapes, what’s inside isn’t pretty much the same?  How could they charge me more for this one than that one?  They’re all pretty much the same, aren’t they?  It’s almost second nature to think “there’s just got to be more to it than this!”  That need to know more -- to understand the difference, to have it explained or resolved in a way that makes sense -- is the seed from which objections grow.

Before we begin to analyze concession or rental rate objections and preventive techniques, you should begin to recognize all objections as a necessary part of the leasing process.  No one signs a lease without first satisfying their need for information.  An objection is nothing more than a request for more information, and in the case of a concession or rental rate objection they simply want you to give them a good solid reason why your community is worth paying more.

Concession and Rental Rate Objections

These objections are by far the most common and the ones that most apartment leasing professionals dread dealing with.  Consider how careful you are in parting with your own money, and you’ll understand your future resident’s point of view.  The key to successfully handling rental rate or concession objections is to understand the reasons behind the future resident’s protest, but to be fully prepared to defend the value that your rental rate represents.

A future resident that objects to your rental rate sincerely believes that the rate is too high.  See the situation from his or her point of view.  They’re worried about the cost, not just the rental rate.  They’re imagining the sum that you just quoted in the context of their budget and the sum seems inordinately high.  Of course, you can’t change your rental rate to suit every budget or whim, but you can change the future resident’s perceived value.  How? Make the cost insignificant in light of the value that the future resident will receive in return.  If they are not objecting to the rental rate then they may be asking you for a concession.

Begin by showcasing your features, services, and amenities; then explain exactly how and why the future resident will benefit from them.  Remember what I said about the stresses of daily living and working these days? We’re all looking for ways to make our lives easier.  Next, sell yourself.  You’re there to make life easier, and that’s part of the package.  Never apologize for your rental rates or for not offering a special.  Quote your rates with confidence.  Now you’re ready to tackle the objection head-on.

Make certain the future resident understands, and sees (if possible), all of the extras that come with the rental value (special features, appliances, amenities, services, etc.). What else are you selling? You’re selling peace of mind.  The service technicians are on call twenty-four hours a day in case of a maintenance problem.  You’re selling an improved self-image.  Higher rent helps your community maintain a better resident profile.  Everyone has to meet the same high standard, so the prospect will be living among his/her peers.

Tips for Avoiding and Overcoming Concession Objections:

1.    The Future Resident understands that the fastest, most effective way to get you to lower your rental rate or give away a month’s free rent is to tell you that your rental rate is too high, or that your competition is cheaper.  It works, so they use it!  When the Future Resident talks about the rental rate being too high, it’s your time to talk about all the benefits the Future Resident will receiver when living in your community.  When they mention that the community down the street is giving away free rent, it’s your cue to spotlight everything about your community that makes it the better choice (remember to do this professionally.  The goal isn’t to trash the competition, but to show your community in the best possible light).  Please don’t offer them free rent or a color television when they simply say, “Your rate is too high.” They are just trying to negotiate the price down, and it’s up to you to “stick to your guns” and illustrate why your community is worth it’s asking price.

2.    JUSTIFY your rental rate.  When a Future Resident says something about your rental rates, what he is really saying is that he doesn’t appreciate the VALUE your apartments and community offers.  You MUST review the benefits and build VALUE.

3.    If you drop your rental rate or give the Future Resident a discount, you probably don’t realize how much you have weakened your leasing position.  Your response says: “This apartment and community isn’t worth very much in itself so let’s just decide how much you’ll pay and sign the lease.” In the end, your Future Resident may lose trust in you for initially asking for a higher price while trying to rip him off.

4.    Realize that beneath the objection, most people generally believe that “you get what you pay for.”  They will respect you and your community for successfully defending its true value, and they will be pleased with themselves for selecting a home that is worthy of its price.  Cutting the price undermines your own personal reliability and respectability as a sales professional, and devalues your community and your future resident’s choice.

The objections that most apartment leasing professionals have the hardest time handling and overcoming are: “The apartments down the street offered me one month’s free rent” and “What’s your special?”

Tried and True Techniques for Overcoming Concession Objections:

LP:    “I’m glad you brought that up.  Let me ask you a quick question: Why do you think they are giving away______________ ?”
FR:    “I don’t know, why?”
LP:    “I’m not permitted to talk about our competition, but…I can tell you that we don’t have to offer specials nor do we have the type of residents who move in and out of our community because of specials.”

LP:    “I’m glad you mentioned that special…let me ask you, did they guarantee that your rental rate would remain the same at the end of your lease or tell you how much of an increase to expect?”
FR:    “No, they didn’t mention that.”
LP:    “Specials are usually given to attract you to a community.  Once your lease expires, it only makes sense that they need to recover their loss.  In other words, they’ll probably need to pass along a rental increase.  We feel that specials are only a temporary benefit.  We prefer to offer the long-term benefit of a high quality apartment with_________ and a quality community where residents don’t move in and out looking for the next special.  We prefer long-term quality and stability.  Don’t you agree that’s more important?”

LP:    “Thank you for bringing that to my attention.  Our community is known for quality in its residents, management and service.  We have a community where you can feel comfortable and confident that you and your family will be well taken care of.  Don’t you feel that those things are more important than a temporary concession?”

LP:  “Yes, I’ve noticed that they recently had to start giving away the moon to attract residents.  I’m sure that once you compare our community to theirs, feature to feature, you’ll understand why they have a need to give away a special, and why we don’t have to.

(Use this one with Service/Maintenance Guarantees, and “You’ll Love it Here!” Guarantees)
LP:  “There are many reasons why other communities have to offer specials.  Our community, on the other hand, gives each and every resident dependable, caring management and service.  We back it up with two very important guarantees.  First, we guarantee you’ll love it here.  (Hand the future resident the guarantee.) Our second guarantees you prompt courteous service on your routine maintenance requests.  (Hand them the second guarantee.) Isn’t knowing you’re going to be happy and comfortable more important than a concession?”

Your Rental Rates are Too High!

What if the future resident objects because your competition costs less?

The first step is to be certain the future resident is comparing “apples to apples.” Ask the future resident is he or she genuinely sees the competing community as offering the same value as yours.  Walk the future resident through a step-by-step comparison of benefits and features.  When the future resident is convinced that the competition costs less, take it as a sign that you’ll have to demonstrate how the value of your community is much greater than the perceived cost difference.  Prove that there is really very little cost difference, and you’re offering the better value.

Don’t concede! The future resident often views and poses a rental rate objection as the easiest means of getting you to give away a month’s free rent or to lower your rate.  Dropping your rate or giving away a gift or discount as a means of overcoming objection only serves to permanently weaken your leasing position.  The message is ”My community really isn’t worth much, so I’m open to negotiation.  You just decide how much you want to pay – any old amount is fine with us – and then you can sign the lease.”  Don’t give anything away unless you get something in return!  Ask for a longer lease term, prompt rent payment by the 30th of the month, or a higher security deposit.  View every concession as a loss of profit, and protect your community from that loss by getting a return on your investment!

No matter where your community is located or how low or high your prices are, you have probably heard, “Your rates are too high!” or had someone hang up on you after you gave them the rental rates.  Why do future residents raise the price objection?

Let’s take a look from the future resident’s point of view.  Money isn’t easy to come by, and parting with it represents a bad thing – a cost.  In order to justify the cost, they need to be certain that they’re getting a fair return – a value.  The key to overcoming a rental rate objection is to successfully move the future resident’s focus from cost to value.

RENTAL RATE
VALUE
= COST

Value is made up of all of the benefits that the future resident will receive.  Since you can’t change your rental rates for every future resident’s whim, the only thing you can change is the perceived value.  In other words, you must build up the value to lower the cost of the apartment.

Help your future resident to envision and understand all your features, services and amenities, and explain why he or she will benefit from them.  Remember when selling your services that everybody today wants things that make life easy, and they also want to know “what’s in it for me?” – So tell them!

Tips and Techniques for Overcoming Rental Rate Objections:

1.    Compare apples to apples.  “Let me ask you if we are comparing prices of other communities or comparable worth?” In other words, are the competitions “apples” the same as yours? Perhaps you’ll find its apples to oranges! Make sure the comparison is fair.  A fair comparison begins with benefits and features.

2.    When the Future Resident thinks that the competition costs less you must take this as a sign that you’ll have to demonstrate how the value of your apartment and community is much greater than the price difference that the Future Resident perceives.  To do this you simply show that there is very little price difference.  But much more value when living in your community.

3.    Remember the Future residents automatically make a rental rate/value comparison to determine the COST.  You must look for and increase their perceived value.

4.    Understand that “your rental rates are too high” can be a buying signal.  Don’t let it slip away!

5.    If you get backed into a corner and have to quote the rental rates before you are ready, try saying, “Let me tell you what’s included in that rental rate,” and then go straight into all your benefits.

6.    The price objection is usually a hidden request or a way to hide the real reason for not leasing.  Don’t give up! You now have an opportunity.

7.    Break the monthly rent down by the week or the month.

8.    Question the competition’s lower rental rate.  Why do they charge less? Where do they cut expenses to operate the community? Service? Lawn Maintenance? Etc.

9.    Offer a written guarantee that they’ll be happy living in your community.

10.    Admit that your rental rate is higher and tell why, i.e., services, maintenance, grounds, amenities, quality, etc.

11.    Be confident that your apartments and community has good rental rates for the value.  Your confidence is contagious and will rub off on your Future Resident.  When you hear “Your rate is too high” or “That’s more than I wanted to spend”, you will be glad to answer with enthusiasm if you develop your skills.

12.    Try asking, “Compared to what?” By saying that, you will isolate what the Future Resident thinks is the going rate and then sell VALUE, don’t sell price.

13.    Energy efficient – you’ll save $ on utilities.  Point out all the energy saving features of your apartments.

14.    Figure out what the real objection is.

a)    The rate is more than the Future Resident budgeted.
b)    The rate is more than the competitions.
c)    The rate is unexpected.

In handling:

a)    More than budgeted: Find ways to suggest economics.
·    What is the rate per week? Per day?
·    Closer to work?
·    More energy efficient, explain to them why and what you have to offer?
·    What other areas will the Future Resident save $$$ in? Services? Time?

b)    The rate is more than the competition:
·    Build Value
·    How are your apartments and community different?
·    Compare the floor plan, which layout is better for them

c)    The rate is unexpected: This objection is probably the easiest.  Simply show and tell the Future Resident why the rate is reasonable.  Review ALL the features / benefits and services.

How Well Do You Handle Rental Rate Objections?

Test Your Rental Rate Objections Handling Skills.

Never       Sometimes       Always

I give up if a Future Resident objects.                 _____       _____        _____
I feel like I should offer a concession/special
I get defensive.                      _____       _____        _____
I argue the rate is valid.                  _____       _____        _____
I feel rejected.                      _____       _____        _____
I feel that the rental rate is out of my control.      _____       _____        _____
I ignore the objection and keep selling.          _____       _____        _____

Add up the total number of points.  1 point for each never, 2 points for each sometimes and 3 points for each always.  If you scored between 7 and 10 points, you are doing a good job.  Between 11 and 15 points, work on fine tuning your skills.  If you scored between 16 and 21, work on your skills so that you will be able to close more leases.

Wouldn’t it be nice if we didn’t have to worry about lease expirations? If every resident simply moved in and stayed….and stayed…and stayed? Ah, but this is the real world—and in the real world, leases expire and residents move out. Even the best resident retention plan won’t  eliminate turnover.

Because lease expirations are a fact of life, they must be managed like any other aspect a property. You need techniques for ending leases at the most appropriate times and in manageable numbers. You also need strategies for getting a little more mileage out of a resident—for those times when the market is terrible and your occupancy is not all that it should be. This article will look at some lease-expiration strategies that help you protect your occupancy and your income.

It’s Staggering!

One of the most effective techniques for controlling expiration's and ensuring that your occupancy doesn’t take any sudden plunges is to stagger lease-end dates. Some companies follow very strict policies about how many leases can end in a given month, ensuring that only a certain percentage of the total number of apartments turn over at the same time. Others try to make sure that most of their leases end in the spring and summer months, when traffic is at its highest. Companies with high numbers of student residents often write their leases with the school year in mind, offering lease-end dates that coincide with the ends of semesters or terms. By controlling the number of leases expiring in a given period, you make life easier on yourself and your entire staff. Your service teams won’t be faced with a daunting number of make-readies all at once, and your leasing professionals won’t suddenly find themselves with impossible numbers of vacancies to fill.

Another approach involves staggering leases by apartment types. This ensures that you don’t end up with an oversupply of one apartment type and no availability in other types. If you are very in tune to your market, and you notice that there is a higher demand for certain floor plans at certain times of the year, you can stagger leases to ensure that vacancies in specific apartments coincide with demand for those apartment types. If you don’t have a sense of which apartments are most in demand at certain times, review your traffic reports and lease information for the past couple of years and see if you can discern a trend. You might be surprised.

Any staggered expiration approach will almost certainly involve offering non-standard lease terms. For example, if a resident signs a lease in February, and you have already scheduled your maximum number of move-outs for February of the following year, you will have to offer either an 11-month or a 13-month lease. If you’ve already filled up your move-in slots for January and February and March, the lease expiration will have to be pushed into either December or April. Some companies put a “flexibility” sales spin on the funky lease terms, allowing residents to pick their own move-out month based on expiration availability.

Going Month to Month

Offering residents a month-to-month option may also help you manage move-outs. There are some disadvantages to the approach—the most obvious, of course, being its uncertainty. The more residents you have on month-to-month leases, the more precarious is your occupancy. You have no way of accurately forecasting your turnover beyond 30 days unless you REQUEST a 60 to 90 day notice to vacate.

But stress level aside, month-to-month agreements can work wonders for a community’s occupancy. If you simply can’t afford to lose residents, they can be just right carrot to entice those who are hesitant to sign a year or six-month lease. A month-to-month can also be useful for eking out just a few more months of occupancy when you need them most. For example, if you can convince a resident whose lease is ending in February to stick around for just another two or three months, you will be that much closer to warm weather—and to the traffic you need to fill vacancies.

If you opt to let residents renew their leases on a month-to-month basis, you are entering into what is properly called a “rental agreement” rather than a lease. Essentially, this agreement expires at the end of each month, and is automatically renewed when the resident pays his or her rent for the next month. In addition to specifying the standard terms that all leaseholders agree to (resident and management obligations, rules, etc.), the agreement should specify:

·    How much notice the resident must give if he or she decides to vacate, and
·    How much notice the property or manager must give the resident in order to either change the terms of the agreement or end the agreement

The length of both these notice periods is often 30 days, but may vary from state to state.

If possible, when offering a month-to-month lease you should ask for more rent. In many markets, residents are willing to pay a premium for the flexibility of such an agreement. However, if it is the weakness of your market that is forcing you into a MTM in the first place, you may find it impossible to increase the rate. If this is the case—and if you really need the resident for a bit longer—don’t get stuck on the idea of charging a premium. Keep your eyes on the prize: you’re NOI.

The Ostrich Approach
In markets that are extremely difficult, some communities may opt to simply ignore lease expiration's altogether. That is, they do nothing to bring the lease end to the resident’s attention, in the hope that the resident will simply go on living there—and go on paying rent—as if nothing has happened. Doing this creates a “tenancy at will,” which means the tenancy has no specified duration and can be terminated at any time by either party. Laws may vary from state to state, so you should check, but in most cases, the original terms of the lease are still binding (with the exception of the lease term dates). Either the resident or the community may residency the tenancy with a certain amount of written notice, which varies from state to state. The community may also change the terms of the lease—such as the rent or security deposit—with a specified length of notice.
In practice, then, this approach differs little from a month-to-month rental agreement. The main difference is the lack of paperwork. Another practical difference is usually the ability to charge a premium. While some communities charge a higher rate for the month-to-month option, those that opt to create tenancies at will are almost certainly not asking for more rent. Quite the opposite, in fact— they generally need their residents so badly that they’ll do whatever they can to avoid rocking the boat.

Squeezing in Some Marketing

Which ever strategy or strategies you use for renewals, one challenge you undoubtedly face is managing them in such a way that you have enough time to market newly vacant apartments. This requires balancing two sides of your managerial personality. On one hand, you want to give a current resident every possible chance to renew his or her lease—right down to the wire. On the other hand, you need to know what apartments are vacating so you can start advertising them. The longer you wait to market, the longer the apartment may have to sit vacant. So how do you satisfy both of these demands?

Part of the solution may lie in how much in advance you contact your potential renewals. The question of when to first approach residents with notice of their impending lease expirations depends largely on the state-mandated length of notice they are required to give of their intent to vacate. The general rule if to make contact at least one month before this formal notice is required. Following that guideline, then, communities with a 30 day-notice might make contact 60 days in advance, while those with a 60-day notice might make contact 90 days prior to lease end. Giving yourself the extra month accomplishes two things: (1) it allows you to surface objections that can be overcome, overcome them, and get the renewal, and (2) it allows you to identify those “solid” no’s, so you can start looking for replacement residents.

Solid no’s are generally those residents who are making major life changes—buying a home, moving out of town, getting married, etc. While it’s not impossible that they’ll change their minds, it is mighty unlikely. You are probably safe to assume that they’ll be vacating. Other solid no’s are those residents who, for whatever reason, are clearly unhappy in your community. You know who they are—every property has at least one.

Once you’ve identified those residents you know will be moving out, you can start your marketing efforts for those apartments. If you have a close-knit community, you may want to start close to home—with the neighbors of the soon-to-be-vacant apartment. Simply call those residents in the vicinity of the apartment, and say, “Mrs. Smith, can you think of anyone you’d especially like to have as a neighbor? The apartment right across the hall from you is opening up next month, and I wanted to let you know before we start advertising it, in case you had someone special in mind.” Who knows—you might just get a referral! And even if you don’t, you’ll win points with Mrs. Smith and the other residents you contact.

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