Experienced real estate investors know even small factors can make or break their wealth-building efforts. While broadly, that single factor is due diligence, we want to get a little more specific. We’re talking about what your residents really want.
Attracting and retaining residents is essential. When you don’t have a resident, you aren’t just denied cash flow – you’re losing money.
Passive real estate investors likely aren’t at the helm for marketing properties and securing new residents. That and lease agreements are handled by your property management team. But just because you’re not the one handling these tasks doesn’t mean you gloss over them. For real estate investors, the more you know about this business, the more equipped you are to succeed!
If you know what people want, you’ll better understand what to look for in properties and their managers.
Let’s break down what residents really want.
7 Things Residents Value in a Rental Home
1. Safety and Security
The number one thing people want in any home, rental or otherwise, is safety. They want to feel comfortable and relaxed where they live. You might immediately consider safety a safe area, but it goes beyond that. Safety and security means doors and locks that work properly. It means outdoor lighting and minimizing tripping hazards. Proper wiring and finishes. Appropriate safety features, like secure stair railings. The list goes on!
2. Privacy
Residents also need privacy. For one, this means your managers aren’t prone to “pop in.” Residents are always given proper notice whenever the manager, repairman, delivery guy, etc., need to access the property. Privacy also means space. Is the property really close to the neighbors? Does sound carry through every room? Are their awkwardly placed windows that let passersby or neighbors peek in?
3. Well-Kept Conditions
This simple concept can be difficult for some investors to keep up with. Every person wants a home they can feel proud of. The details matter. Think about the property’s paint job, fixtures, and finishes. Are they well-done, or do they fall into the “landlord special” category? Investors should mind cleanliness and condition, especially over time.
4. Convenient Location
Rental properties are primarily about convenience and affordability. Residents want properties near community amenities – think parks, shopping, and entertainment – and the workplace. Triangulating these locations is challenging, especially in a tight real estate market. That said, location sells!
5. Amenities
When people rent a detached single-family home, they usually expect a little more out of their experience than they would from an apartment or a duplex. While apartments may have community amenities, SFRs are expected to carry their own perks. Increased square footage (including extra bedrooms and bathrooms), private decks or outdoor spaces, on-site laundry, a garage or driveway, storage space, etc., are all incentives to rent and continue renting.
Think about what is and isn’t convenient about your own home. Put yourself in your property. Would you want to stay there long-term?
6. Responsive Management
While residents can handle some maintenance issues on their own, some things need a professional touch. When a resident has a problem, your management team must be responsive to their needs. This is critical. Not only should managers reply promptly, but they should provide a timeline for addressing the issue as quickly as possible.
7. Fair Terms
Finally, rental residents are after fair terms. Investors constantly strike that balance of appropriate profit margins and reasonable rental rates. It’s tough. Ultimately, residents are willing to pay a premium when the experience matches the price tag.
It’s less about what you charge and more about being reasonable. That comes in when your residents have a rough month and need extra time to get their payment in. Or when a global pandemic creates financial hardship. If they communicate these needs clearly, will management help find a solution?
Does your management team do their best to work with and retain good residents, or do they kick them to the curb?
Ultimately, what your residents value in a property influences the houses you buy, the people you hire, and the resources you allocate. Get into their head. Value what they care about. You’ll find it’s better for everyone when you do!
We've done the hard work, vetting properties that fit what residents are looking for.
