Understanding the Multifamily Housing Market: What Differentiates Leasing From Other Sales Environments
There was a time that sales managers were more likely to hire a new agent with experience selling something than an employee without any salesmanship experience at all. But, that isn’t necessarily a great approach in the multifamily housing industry.
Leasing Apartments is a Different Platform
Unlike selling a tire to someone stuck on the side of the road with a flat tire, selling an apartment requires a different approach.
Why? Although some home seekers are in desperate circumstances and others are casually shopping for a new place when the current lease expires, the vast majority are looking for an apartment because they need to move.
It’s the difference between optional and necessary, want and must-have, discretionary and fundamental. Unlike that stranded drive, renters must think beyond getting off the interstate – getting out of the current situation compelling them to move – because leasing an apartment requires a long-term commitment. If someone is looking for a temporary apartment because they’ve lost a job or taken a cut in pay, short-term leasing may create more problems down the road since many multifamily communities charge higher rates for shorter terms.
There’s B2B, B2C and Apartment Home Leasing
Selling apartments is in a class of its own when it comes to putting a label on sales strategy development. There are a few metrics that property managers use to measure sales team performance, like closing ratios and conversion rates. But, some metrics don’t work the same as they do in other sectors. For example, high closing ratios can signal rate tiers are too low and your revenue stream may be suffering.
Another unique component that multifamily management teams face is internal competition within the tenant pool. Essentially, applicants actively compete with current and potential property residents for available units. That’s rare in most B2C environments, although clearly tenants are more closely aligned with consumer labels and business labels.
Sales Team Management Strategies
Designing a strong training program for the property leasing team is critical. Team members need a clear set of goals and objectives to work toward, within a well-defined framework. Without establishing a set of metrics to help you monitor team performance, you probably won’t notice patterns that are keeping you from reaching occupancy and financial goals.
While the overall management plan for multifamily properties is vastly different from almost every other sales related industry, there are some common characteristics every sales agent needs, such as:
- The ability to work with people from diverse backgrounds and educational experiences
- A genuine desire to help all stakeholders
- Authenticity and integrity to bolster consumer confidence
- The gift of gab (rapport building is essential in multifamily sales)
- A level headed approach that is empathetic, but not driven by emotion
How Can You Help Your Team Succeed in a Unique Sales Environment?
- Recognizing the unique structural differences in apartment home leasing and almost every other sales environment is the first step.
- Establishing sound measurement protocol that captures a realistic view and unique relationships of the revenue stream, occupancy rates, conversions and closing rates is equally important.
- Onboarding leasing agents who have industry experience/education or are willing to attend on-going professional development to man your sales desks generally improves outcomes.
There are many other things that differentiate apartment leasing from other retail sectors. Comment below to let us know if you want to hear more about the similarities and differences.