Each new year is marked by notable shifts in how tenants approach leasing and how properties can best attract and retain quality renters. The strategies that worked in 2022 may not be the best options for 2023. As the new year kicks off, now’s a great time to consider your property management resolutions and what you should look to budget for next year. (Hint: solutions that give renters more flexibility and help you better manage property services will be the quickest wins.)
Here are the top trends in property management to look out for in 2023:
1. Strong Growth and Demand
Even with fears of a looming recession, the rental market is still booming. Rent prices have continued to climb in top markets across the United States, and demand is still strong. This is especially true for multifamily properties. Single-family homes remain a rare find on the rental market, so tenants have begun to explore other housing options with multiple units.
With demand still hot, many property management companies have already stated their intent to expand their portfolios in 2023. This has concurrently driven a significant demand for property management services and tools that help automate tasks and ease the burden placed on onsite managers and staff.
2. Creative Rental Incentives
Even with a strong rental market, property managers will still be experimenting with unique incentives in 2023. Attracting top tenants remains a top priority, and competing for these tenants can often drive attractive incentive terms for prospective renters. There has been especially strong growth in new construction of luxury apartment complexes, which are notorious for offering incentives to fill their slate of apartments. Established landlords have no choice but to compete.
Incentives may include longer lease terms or promotional deals with additional inclusions. One tactic that will likely continue into 2023 is incentives tied with property tours – either virtual or in-person. Waiving application fees or providing discounts following tours can be a great way to drive urgency among prospective renters.
3. More Pet-Friendly Policies
Pet-friendly policies will remain competitive advantages for landlords in 2023. Not only do pet-friendly facilities instantly increase tenant application pools, but they can also help boost the quality of tenant applicants. Typically, renters who own pets are also more responsible, accountable, and interested in longer lease terms.
Developing a pet-friendly policy for your property can also increase net operating income (NOI) through the collection of deposits and fees. With economic uncertainty on the horizon, this added revenue can make a significant difference in your bottom line. If you’re struggling with managing pets already on property or don’t know where to start, specialty tools such as OurPetPolicy can help.
4. Shift to Services vs. Amenities
Years ago, amenities were a hot commodity. Apartment complexes raced to add free coffee, ping pong tables, and upgraded fitness centers to attract the next generation of tenants. While amenities will certainly still be an important draw in 2023, tenants are increasingly more interested in services rather than saunas or rooftop lounges.
Property managers would be wise to invest in their maintenance response times and the accessibility of any onsite staff. Renters are also becoming more interested in performing tasks remotely instead of having to speak with someone in-person. Mobile platforms and chat functionality can help retain tenants and keep them satisfied.
5. Use of Property Management Software
Software solutions have become important tools to manage businesses across industries. Real estate and rental housing is no different. A top trend to look out for in the coming year is the growth in tools available to property owners. These tools can help automate processes like rent collection, virtual leasing, property maintenance, and even pet management.
Not only can these solutions drive efficiency, productivity, and cost savings, but they can also help your properties generate additional income and increase tenant satisfaction. Additionally, they can free your employees from manual tasks so that they can focus on more important responsibilities.
Get a Head Start on 2023
Property managers have a lot to be optimistic about in the new year. With rental demand still strong, now’s the time to start rethinking your business strategy and how you can better manage your units to better serve your tenants and your bottom line.
Of all the trends, the best options for property managers to stay competitive in the market and increase their tenant application pool in the new year is to introduce pet-friendly policies and invest in property management software. Solutions such as OurPetPolicy can help make that transition easy and seamless.
