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The Times They Are a-Changin’
Months after the pandemic began, a certain reality has set in among apartment operators: the old way of doing business isn’t coming back anytime soon. Practices that may have been highly unusual before – such as touchless move-ins and move-outs – are not only helping residents and operators get through the pandemic, they are likely to become permanent, mainstream features of multifamily because of the efficiencies they create. Operators also report that, in addition to embracing new technologies, they have become more willing to share information as the industry navigates these unprecedented circumstances.
A Needed Pick-Me-Up in Tough Times
There’s no getting around it: working in multifamily is challenging under the best of circumstances. The current environment is hardly the best of circumstances, and associates’ stress levels are rising. To help their employees cope, operators are offering – among other things – counseling programs, Zoom parties with deejays, gift cards and cash bonuses. Apartment companies realize there’s no silver bullet when it comes to improving morale. “We host parades, online reading clubs, virtual exercise groups, food trucks and provide pop-in surprises for our teams and residents to ensure that they know we are always here to support them in any way we can,” said Melody King, senior regional vice president at BH Management.
Create Ancillary Revenue Through Pet Amenities and Services
In today’s challenging market, owners and operators are anxious to recover lost income. Pet rent, pet amenities and concierge pet services are among the ways they can do that. More and more residents are adopting and fostering dogs and cats to combat the isolation they feel during the COVID era, and they’re willing to spend some money to provide their furry companions with a high quality of life. This means onsite services such as dog-walking and pet-grooming can be highly effective ways to generate much-needed ancillary revenue.
IN THE NEWS
Trump’s Plan to Stop Evictions Sparks Criticism
Last week, the Trump Administration announced it would halt some evictions through the end of 2020. The moratorium, which was made through an unusual order by the CDC declaring evictions during the pandemic a public health risk, applies to individuals who earn no more than $99,000 a year ($198,000 for couples), have received a stimulus check or were exempt from paying income tax in 2019. The announcement immediately raised concern in the rental housing industry, where advocates say the federal government needs to provide financial relief for both residents and property owners.
Rent Concessions Increasing as Operators Cope with Pandemic
If you need concrete evidence of how the apartment market has softened during the pandemic, consider rental concessions. The percentage of Zillow rental listings advertising some type of concession, such as a free month of rent, nearly doubled – from 16.2% to 30.4% – from February to July. In July 2019, the share was 12.5%. According to Zillow, free rent has been the most common concession, followed by reduced or waived security deposits and gift cards. The company also noted that operators appear to be using concessions to stimulate demand rather than lowering rental rates.
Renters at Small Multifamily Properties Are Struggling
Reports produced by the apartment industry have generally produced encouraging numbers regarding what percentage of renters have been paying their rent during the pandemic. But these surveys typically don’t include smaller apartment properties that don’t use large, professional operators – and residents at these sites are hurting. According to a survey by the National Association of Hispanic Real Estate Professionals and the University of California, Berkeley, 30% of managers with one to four units said their rent collections have decreased by more than 25%. Renters at small apartment properties tend to work in industries that are especially vulnerable to COVID, the Urban Institute says.