Economics Websites: Filling & Refilling Properties With Tenants
In September of this year, we had one of our student rental properties get hit with four unexpected vacancies.
That’s a big deal and turns the property into a negative cash flow machine because the three remaining tenants’ rents aren't enough to cover the expenses.
To save time, we decided to leverage an extended family member who lives close to York University in Toronto to handle incoming phone calls from the yard sign and place the economic websites online classified, show the rooms, and sign the leases. She had done this before so we don’t foresee any issues.
After two full months of vacancies the alarm bells finally went off that something wasn’t working. It shouldn’t take two months to fill the property and in that time none of the four rooms had been rented.
Which is extremely strange because our property is in better condition and the room sizes were created to be purposefully larger than our competitors. So there should be no reason we’re not attracting tenants into the place.
When I began to dig into this, it became clear there were some small issues that were all adding up:
1. The yard sign was ripped down by some drunk students and thrown a block away from the house.
It sat like that for an undetermined amount of time.
2. The economics websites online classified ad, although placed, was never monitored. So it always fell to page 2 and beyond on the economics website rather quickly and it had no pictures! Online classifieds need fresh pictures every couple of weeks. It’s what keeps the ad looking fresh and new. All the other ads had pictures and ours had none!
3. The economics websites online classified ad also had a horrible subject line. It read “Close to school.” Well, all of our competition is “close to the school.” It had no mention of how clean the house was (important for students) or how large the rooms were and no mention of exactly how close it really is. Our property is closer than many of the others but you wouldn’t know that from the subject line.
4. Because the person we had handling this got busy with other priorities, the calls that were coming in were not getting appropriate attention. She was screening tenants over the phone. This is the single biggest mistake most “experienced investors” make with tenants. They feel that they can save time by explaining everything and “selling” over the phone. It’s possible, but very difficult. So very few people were actually seeing the rooms. In sales you must create emotion and it’s difficult to do that over the phone.
How did we change things? Every single time we encounter a property that is having some difficulty getting a tenant, we default to doing one thing: CREATING MOMENTUM and doing it QUICKLY
There is magic with momentum. Here’s what we did:
1. We visited the property with Taylor, Rock Star Property Manager, to put up a new yard sign and then immediately walked through the York Campus to track down where we could advertise within the campus.
It turned out that they don’t allow posters on campus but we learned that there is a very popular student paper and for $35 would could advertise in it. We placed the ad immediately. And not only was that a great tip … it turned out we would be the ONLY rental property ad in the entire paper! Bingo.
2. We also decided to take the opportunity to throw up a coat of fresh paint in the vacant rooms and then changed the subject line of the economics websites online classified ad to “Huge Rooms, Clean & Bright, Freshly Painted, 90 second walk to school!” We also paid to have the online ad show on the first page and monitored it.
We also created an ad on Kijiji.ca to supplement the newspaper and the student online classified site.
We paid $1.99 to regularly bump the student rental ad in Kijiiji to the first page.
3. We had Taylor handle the income calls. Student rental calls are best taken live. Their demand is literally immediate and their need will disappear in 48 hours or less. Taylor took the calls, made appointments to show the room THE SAME DAY whenever possible. Even if it was to show the rooms to only one person—we made the appointment anyway.
Within 3.5 weeks we had multiple people on standby for the rooms and literally had to hold two students off while we negotiated with a group of three girls to take the rooms at full price on a one year lease. We then accepted a fourth girl for the fourth room, which is the hardest to rent because it’s the smallest and located on the main floor of the house. We ended up getting full price for that room as well.
Why did we have such different results with the second effort? We created momentum. We did everything we could to get the property filled—including painting the rooms.
investors lack the urgency and momentum building that creates energy around a
property. Momentum is a key ally in this process … do everything you can to create
it. Move fast. Take action. Don’t wait.
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