As someone who has been described as a “deal junkie,” I look at A LOT of properties every day. My eye immediately trains on what could add value to a property I’m considering for purchase or one we are already managing for a client or one that I own.
To develop the “eye”, there is nothing like getting experience leasing your own properties. The invaluable time spent advertising your units and coming up with a hook to interest prospective residents so that they ignore the hundred other vacants and call you will hone your attention to your competition. Then showing, negotiating and closing the deal for a new resident is an experience which imbrues what tenants want and will pay for.
The knowledge garnered from being my own leasing agent revolved around what sets my unit, property, neighborhood and management apart. Why should someone rent my apartment and how can I generate more income were questions which rolled around my head 23 years ago and still do every day. If spending a week leasing one of your units isn’t feasible, consider spending time with one of your leasing agents so that you can see the process firsthand. This is invaluable experience and should be done at least once per year.
As all real estate is local, it is important to understand the pluses and minuses of the neighborhood your property resides. If you have time to get personally involved with Neighborhood Watch or the City Council or even the School Board, it is a positive. Making your community better from an organic level is great for your property and for those who live in and around it. If like me, you have many properties in many neighborhoods, encourage your team who works for you to get involved. We support politicians and organizations which we believe add alpha to the surrounding area.
Even more local than your city and neighborhood is your property. Visiting properties, particularly newly constructed or newly refurbished by large institutions can inspire new ideas. Many of the largest owners hire consultants who poll residents to see what they are looking for and they vet the newest trends. In other words, you can draft off of the most fashionable ideas for the cost of your time touring the properties.
One trend we picked up on is open meeting space. Even though everyone has their own unit, a popular amenity is a comfortable lounge in which to connect to Wi-Fi (another popular feature). Just like everyone could enjoy coffee in the comfort of their own home, many people enjoy a cup at their local gourmet coffee shop for the experience. Plus it offers a place for collaborative work space away from their own apartment which may be unkempt. Lastly, all properties have a roof but very few offer a roof deck (another place for a meeting space particularly if you own in area with a temperate climate).
A fitness room can be simply added by purchasing a couple of aerobic machines (i.e. elliptical and stationary bike) and a stretching mat. We recently did this in a large laundry room in a hip area of Atlanta. Add a flat screen television and some mirrors and you have a valuable amenity which in our case caused a spike in laundry revenue since people brought their dirty clothes with them to the fitness/laundry room.
More and more residents care about their carbon footprint. One thing we advertised in Austin, Texas and Las Vegas, Nevada was our extremely low water usage in “zeroscape” landscaping. The best part for us is that both cities offered rebates to install hearty low water foliage along with rock instead of grass. It looks very good and our water bill shrank significantly. A win, win, win situation.
Lastly, the apartment itself needs your eye. As boomers are getting older, making bathrooms handicap accessible by installing handrails near the toilet and in the bath tub has become popular. Things to make life easier for older residents might keep them from leaving your apartment for another property.
We have found that adding a small pony wall in a large studio can create a delineation that feels almost like a bedroom has been added. While we don’t call the new unit a 1 bedroom, we do label it a “Grand Studio” and charge a premium. It is rare for me to walk into an apartment and not find something that could add value. Test your eye by going into one of your units which you haven’t seen in some time.
The last thing to set you apart is good management. If you make use of a third party management company, audit them by popping into your property and calling the phone number to see if someone picks up right away. Check their advertising by going on-line as a prospective resident.
Are maintenance requests handled in a timely fashion, is the property kept clean and appealing and is the manager friendly and responsive to residents? Does management show good form in enforcing house rules and collecting rent? These are valuable questions to constantly ask in making sure that you set yourself apart from your competition.
It is a huge positive to develop and hone your “eye” as you will benefit directly from this skill.