Apartment marketing
Apartment Loss to Lease – How do you book it?
In the spirit of the upcoming 2012 budget season; I wanted to recycle this post. This is a subject of much debate in our office and I am interested in what the industry thinks.
Loss to Lease
There is a question floating around our office along the lines of, “What do you book in loss to lease line of your budget?” Also, “On a percentage basis, where do you like to see that number trend?” With that question comes a number of schools of thought but no real definitive answer. And, that being said, I am not sure there is a right way or a wrong way to look at it. In the end, it all shakes out in the Rental Income line. That said, there is value in tracking the discount from new vs. renewals and even budgeted rental increases that drive the loss to lease margins.
Our current practice is to book both discounts from new sales and renewals to a single loss to lease line. And, we try keep the loss to lease number at two to three percent of the the gross potential or top line – if you will.
Here are a couple of schools of thought to throw out there:
What gets booked in loss to lease?
1. The only thing that gets booked in the loss to lease line is discounts from market on new leases only. Renewals that maintain any discount from the top line should be booked as a concession.
2. Any discount from market gets booked as an upfront or recurring concession – be it a new lease or a renewal that transacts at a rate lower than the top line.
Where should loss to lease trend as it relates to the top line?
1. The number should be maintain between two to three percent of your top line
2. The number will trend at nearly ten percent of your top line
Is there real value in tracking loss to lease as a line item?
If it all shakes out in the rental income number – is there any real value [up market or down market] to tracking this number?
I’m curious to hear your thoughts. I am really curious to hear from those of you that are utilizing LRO as I think you have done away with the concept of loss to lease – correct?
Technorati Tags: @mbrewer, mbrewer, mike brewer, apartment operations, loss to lease, gain loss,
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Apartment Pics: Photosynth
Caught this story over at a Century 21 site. Photosynth is an iPhone app that allows you to take 360 photos and upload them right to the likes of Facebook and the such. It’s after dark now but I can’t wait to try this out tomorrow.
Get Them Involved
I can see this being a very cool app not only for our site teams but for residents and prospects alike. That is if they have an iPhone or iPad. With that note in mind, think of the possibilites;
Tour
1. 360 views of your apartment communities curb appeal
2. 360 views of your apartment business/leasing/clubhouse
3.360 views of your grounds and common areas
4. 360 views of any or all rooms in any given apartment
Maintenance
1. 360 view of move out walk for the purpose of returning paid deposits or charging for damages
Due Diligence
1. 360 view of personal property inventory
2. 360 view of apartment condition at time of purchase
What else?
1. Would be cool to have something like this integrate in to Yardi, Real Page, MRI or the such…
2. Pics for website property landing pages
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#apartmentmarketing: Social Media Proof
The next time you hear a social media myth, question it. Ask for the proof, and ask out loud. – Dan Zarrella
So much flying around out there in the way of experts, guru’s, master’s of the universe and the such.
My new default gauge for validation; can I talk to a client that used your service prior to social media taking front and center? And, if that answer suffices; then you can show me your social media results and pass along another client testimonial or two.
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#apartmentmarketing: Facebook vs. G+
Are you wondering if G+ business pages, when they debut, will be worth the work for your apartment community or property management company?
Here is my take –
He who controleth the algorithm’s to Page Rank is the one for all of thee…
Short answer – yes
That is not to mention, I predict 9/10 of the work is already done via their Places platform
Ignore at your Rank’s risk…
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#apartmentmarketing: Enchantment
When you enchant People, your goal is not to make money from them or to get the to do what you want, but to fill them with great delight. – Guy Kawasaki
I read somewhere that if you are blogging or doing social media without the intent of selling more stuff, you are a hobbyist. I call bunk on that thought.
I’ve been blogging for nearly seven years now. And, I can tell you I don’t do it to sell more things. Moreover, I can tell you I don’t do it for a hobby. The work ethic alone in terms of keeping it up makes it much more than a hobby. I do it to be enchanted, to be enlightened, to be better at what I do.
That is not to suggest that there are some diary writers out there that are cataloging their life for no other purpose but to just do it.
I look at it like this – blogging has been a gateway to some very amazing relationships, educational opportunities and otherwise. For me, it’s value comes not in the way of consulting gigs, widget sales or other offerings but rather in the relationships I get to partake in. Now one could argue that all that leads to sales. Maybe so. But it’s not the premise for every blog and neither is every blog a hobby. Even some of the corporate types.
I would even go out on a limb to say that those who don’t set the premise as a sales oriented one but rather one of – exposure to some cool people I can learn from – end up selling more stuff.
Thoughts?
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