Thanks to the trickle-down impacts of COVID-19 (remote work, job loss, etc.) Americans have been moving more than ever this year. In fact, according to a recent analysis of USPS data, nearly 16 million people moved between February and July alone. Many of those moved out of larger cities into smaller surrounding communities or suburbs or just to be closer to family and friends during lockdowns. Others took advantage of remote work arrangements to live somewhere new -- often, far from their office or employer’s place of business.
Whatever the reason, the uptick in migration presents an opportunity for rental property investors: a chance to fill those vacancies and maybe get a few long-term tenants in the process.
Do you have vacant units in your rental properties? Want to attract these migrating renters to fill them? Here are five steps you can take.
1. Offer short-term leases
Temporary moves have jumped the most, seeing a 27% surge over last year’s stats. And offering short-term leases? That’s the perfect way to appeal to these more transitory tenants.
According to data from Apartment List, about 11% of renters looking to move in the next year want a short-term lease. This gives them the opportunity to ride out the pandemic storm in a new spot while also offering an easy out should they need to head home later on.
If you go this route, you might start with a six-month lease or, in some cases, let tenants go month-to-month. Just remember to factor in the extra costs of these shorter-term leases (more turnover, more marketing, more time vacant, etc.) and adjust your rent accordingly.
2. Make sure your Wi-Fi is up to speed
If your building has managed internet, do a checkup on your connection speeds (try Speedtest.net). Since the pandemic has many people working from home (not to mention quarantining there), strong WiFi connections are in high demand. They also allow renters to participate in Zoom (NASDAQ: ZM) calls more successfully; stream Netflix (NASDAQ: NFLX), Hulu, and other content platforms; play Wi-Fi-based video games; and more.
If your speeds aren’t great or you often get complaints from existing tenants, consider working with your internet service provider to troubleshoot the issue. You could also add bandwidth, switch ISPs, or add a second ISP (maybe one for each side or floor of the building?).
3. Make the online leasing process a breeze
With many renters migrating in from other states and cities, a seamless virtual leasing process is critical. Potential tenants need to be able to find your property online, tour the unit, and complete the application and leasing process remotely. If these three pieces of the puzzle aren’t there, capturing those migrating tenants will be an uphill battle from the start.
4. Have a co-working space on site
Make remote work easy by offering an on-site co-working space -- one with printers, fax machines, monitors, and other equipment your renters might need in their day-to-day work. A coffee maker and refreshments aren't bad ideas either.
Just make sure your workstations are separated (at least six feet apart), and think about adding plexiglass between them for added safety. You should also post a cleaning and sanitizing schedule so workers feel safe about hunkering down there.
5. Offer a few concessions
Landlord concessions have jumped quite a bit since the pandemic began -- especially in bigger cities where tenants are fleeing. Some good options to offer are waived fees, gift cards to local businesses, free months of rent, or even complimentary gym memberships. (However, with many gyms closed these days, offering an on-site gym or in-unit perks like Mirror gyms may be a better option.)
The bottom line
Americans are moving. Want to take advantage of the increased migration and fill those rental vacancies? Then stay abreast of changing tenant needs -- and make sure your property falls in line with them.