Residential property managers, leasing agents, and owners often show little imagination marketing their product. At the same time, since early in the century rental housing has experienced steadily declining market share as a total part of the housing market. Additionally, rental housing's market customer base has been notoriously transient. Because of this, the lack of imagination is not surprising and is perhaps even justified. However, the recent recession, consumer balance sheet improvement interest, changing demographics, lost faith in housing's asset value, and more challenging credit is set to potentially move rental housing consumers from transient to long term customers.The prospective evolution / revolution of the rental consumer base offers an unprecedented branding opportunity. More signficant, this is an unrecognized branding opportunities. Investors who recognize and capture this event stand to increase profits, win market share, enjoy a more stable customer base, gain capital market attention and cash, and achieve a tremendous business opportunity. In some ways, the shift is similar to the rise of big box retailers beginning in the 50s and extending to today. Prior to World War II, the consumer did not have the buying power or the interest in the variety of products that the returning GIs from the war would create. The businesses that recognized the shift made billions.
How will rental real estate owners capitalize on this opportunity? First, recognizing that the opportunity is a branding opportunity where consumers are looking for providers delivering consistent high quality results. Plan on rising consumer performance expectations where high quality management, accounting, maintenance, and customer service are assumed. Focus on creating consistent capture and service features that consumers perceive as increasing their quality of life, providing value alternatives, and showing loyalty to them. Clean, consistent, brand focused delivery like large brands such as McDonald's, Best Buy, etc. may become part of the market for winning portfolios.
Some concepts rental owners should be considering include using high end promotional merchandise like personalize furnishings, branded furniture accessories, loyalty programs including point systems and community activities, and higher end marketing activities including potentially greater use of cable and television, billboards, and active internet advertising.
Residential real estate owners whether offering single family or apartments capitalizing on these changes and modifying their business practices stand to win market share, achieve greater margins, find new revenue streams, and to be the large financial winners in this evolving market place. Their customers will enjoy greater satisfaction, loyalty, and stability than rental housing has seen in decades if ever. Both the owners, industry staff, and consumers will be part of a paradigm shift and opportunity that occurs only infrequently.
Blake Ratcliff (US Naval Academy Graduate & Marine Officer, Serial startup entrepreneur, COO/CEO, multifamily / residential investment founder, and property manager).
Blake's crafted 100+ business plans, prepared and delivered 1000+ investor presentations, and is an expert financial modeler. A deeply experienced real estate business person and startup business expert, Blake hones your Business plans, reports, and presentations.
