In case you haven’t read the following quote in awhile, “an ounce of prevention is worth a pound of cure.” Benjamin Franklin gets the credit for this piece of powerful wisdom.
Whether it’s taking on a new partner, new employees, more risk, less risk or using intuition to keep up with the latest trends in our industry, we can’t be too prepared.
Tip #1 is to be “written ready.”
What that means is to write yourself a list of possibilities for the immediate future. It’s not like predicting the future. It’s about anticipating what you’ll need and what may change in your area.
Start a written list today of what you’re hearing, seeing, feeling and knowing regarding the rental housing market, the property management business. Write it on the list even if it’s unlikely or absurd.
Why would you want to be “written ready”? It’s because you want your unconscious to be able to expect the unexpected, or at least be processing all the possibilities. Psychologists and neurologists know that the operating system of our human awareness is mostly subliminal and below the surface of our waking thoughts. What they’ve also recognized is that we can “program” the subconscious to create possible scenarios and relevant responses. Yes, it’s amazing!
Tip #2 is to know the trends that are already in full momentum. You can do this by reading articles like this one and subscribing to trade journals and the publications of our industry’s associations.
If you haven’t joined your local and national associations, don’t hesitate to do so soon. A good example is The National Association of Residential Property Managers (NARPM®), which I recently wrote about.
One trend that’s getting lots of publicity now is an increase in inner-city evictions. Researchers found that one of the major reasons is that institutional investors now own more rentals than ever.
These large, corporate investors evicted at higher rates even after accounting for the demographics of the community where the rental units were located. They know the eviction laws and have investors or shareholders to answer to.
The National Rental Home Council reports that institutional investors have purchased large blocks of homes and used them for rentals. This is one of the reasons that in many areas of the country there is a limited supply of lower-priced houses for sale. The corporate or syndicate investors also purchased rental units from other landlords and inherited residents who sometimes can’t afford to pay rent. Anecdotally, they also tend to evict more quickly.
Government researchers don’t say why many institutional investors evict at higher rates. Some say it’s because their size enables them to negotiate less expensive legal rates and replace renters more quickly than smaller, local property managers. Be aware of that possibility going forward.
Local landlords and managers tend to treat responsible residents more patiently. They’re more likely to work with someone who has lost a job or can’t pay for the short term. Emphasize this in your marketing. Prepare for the advantages and disadvantages of what may impact your corner of the property management world. Remember “Brexit” and the 2016 presidential elections as poignant examples of unexpected outcomes.
Every time you hear a rumor, opinion or statistic that’s relevant to your work, add it to your list. Have a fist full of preventive “ounces” so you won’t need a “pound of cure.”