You are a regional manager and this morning you see the report that you dread. Unfortunately, the number of units on the “days on markets” report is growing. You’re confused and a bit frustrated. The overall portfolio is doing extraordinarily well: rent growth remains strong (sure, not as good as last year, but still quite good), occupancy levels are fine and you’re meeting budget.
Those hard-to-move units are the thorn in your heel. What can you do to fix this problem and get back on trend so fewer units are showing up on your days on market report? While there are a variety of reasons that units may be difficult to move, we’ve identified one of the most prevalent for multifamily professionals. The issue is what we call ‘outlier units’.
What is an Outlier Unit?
In general terms, outlier units are the opposite of typical units (cookie-cutter), where all the units are laid out in a very similar manner. While cookie-cutter units may have the same floor plan layout and same type of characteristics, outlier units tends to contain unique features that make the unit special. They can be smaller, older, and have different finishes. Maybe they're units in newer properties with different tiers of finishes or better views. As a result, they are much harder to categorize and require more work to find the right renter.
3 Tips to Move Outlier Units Faster
There are several reasons that outlier units have become more difficult to market and move. The reality is that they’ve never been “easy” to move, the problem just hid (and often still does). It was buried in ineffective reporting and analytics that allowed outperforming units to mask underperforming units.
Renters have become more sophisticated and the information available to them on the Internet is deeper, more prevalent and personalized. The increased ease and effectiveness of searching for and finding information, and the personalization of said information, has resulted in prospective renters conducting even more of the leasing journey on their own. It may be hard to believe, but we’re a decade into the period dubbed The Zero Moment of Truth (ZMOT).
1. Different Units Require Different Marketing Strategies
A fundamental problem with multifamily marketing is that it views the world through the lens of a floor plan, when renters really view the world through the lens of unit, community and neighborhood. Marketers should dedicate the same level of effort toward creating content about the unit as they do for floor plan content. Write great descriptions for a one-bedroom, include captivating photos and even experiment with providing a virtual tour.
Enabling prospects to gain more of the experience of living in the actual apartment, as well as the community helps separate your property from other options. Floor plan level marketing falls short because of its inability to reveal the personality of the property and the unit.
When writing descriptions and taking photos, think about what makes your unit different from others. Does it have stainless steel appliances? What about tile selection and flooring? Prospects want to see even the smallest of details through good video and photos, such as paint color, lighting fixtures, carpet quality and more.
2. Better Utilize Email Marketing
While leads are often generated online through Internet Listing Services, most marketing software doesn’t allow outlier units to be managed uniquely. If that’s the case, you still have a powerful opportunity to nurture the lead effectively. Unfortunately, it is still the rare multifamily marketer that takes full advantage of email marketing. A recent study showed that over the last three years, multifamily has regressed on their use of email.
It is crucial that you move beyond just the floor plan when using email marketing, especially when marketing outlier units. Email is not only an opportunity to broadcast and promote, it’s also an opportunity to build greater engagement, learn more and sell to today’s digital savvy renters. Using a product like Nestio allows for a better marketing experience on the unit level.
3. Refine Your Metrics to Better Account for Outlier Units
When you look at your portfolio overall, you don’t get the true picture of how the portfolio is performing. The danger of looking at just averages is that the numbers can be misleading.
Consider for the moment that you’re analyzing a region with 1,700 units. Of these, 1,200 fall into the typical category of units, where traditional approaches are good enough (for now). Upon closer examination, you see these units are performing better than you first thought. They’re not just meeting expectations, they’re exceeding them. Then you get the surprise. A group of 500 units – the units that aren’t quite like your typical units – are underperforming significantly. You realize that while the portfolio is doing fine, this underperforming cohort is dragging overall performance. You’ll be more proactive and effective if you break unit types into cohorts and track your metrics by these cohorts.