LWS Rental Market Update No. 2 (COVID-19): Apartments Show Resilience Amid Crisis
Since our last update a lot has happened, including news that property management firms were officially deemed an essential industry by the Ontario government. This means they can remain open for business throughout the COVID-19 crisis.
In most cases, our data and research indicates that apartment demand hasn't disappeared; it now could just be a question of what multifamily asset class will perform the best and how to fulfill the demand – safely, given the situation.
On the supply side, our initial research indicates a possible shift within the short-term rental inventory, including Airbnbs joining the long-term rental market, which could flood and unbalance the market in favour of renters.
What our data shows
During a typical March, we would expect to see steady growth in total leads generated across our network of rental listing sites on Rentsync.
As expected, in the first week of March 2020, we saw a 19% gain in total leads versus the last week of February. Overall, lead volume in March is up 2.4% vs the same period in February.
So, despite COVID-19, there seems to be a stable number of incoming leads being generated. The bottom line: people still appear to be searching for their next place to rent during this time.
Why people might be searching during COVID-19
There are a few reasons why renters still might be actively looking online for apartments. Here are some possibilities to consider:
- Their lease has expired and they have to move (or they have already given notice)
- They're looking for more affordable housing alternatives (Class B or C properties)
- Quarantine and self-isolation provides them with unlimited time to search
For prospective tenants who are serious about renting, the current social distancing and self-isolation measures allow them a considerable amount of time to research potential properties (maybe yours). This is an important detail for property owners and marketers to understand;
This cohort of prospects have potentially had more time than any other cohort before, to perform due diligence on their next move.
As a result of this situation, we've put together some recommendations for optimizing advertising and leasing agreements as tenants and prospects continue to look for places to live, in albeit, an increasingly digital environment.
Now is the time to ramp up and improve your marketing
Nurture leads because competition is fierce:
- Emails: During this time digital communications are of great importance. Use email to connect with leads and keep them updated on policies and promotions.
- Retargeting ads: Don't let your leads forget about you. Use retargeting ads as an inexpensive way to keep your property top of mind as prospects continue to search for rentals online.
- Lease-up campaigns: Use this time to fill units faster with incentives as rates decline.
Improve your digital experience:
- Add virtual touring options: Think outside the box, and consider using Live Video Sharing via Facebook or WhatsApp rather than having prospects visit your location, or add virtual touring capabilities to your website.
- Improve your website: If you've been considering making updates to your website, this is a great time to do so. For example, adding online booking capabilities and digital wait-lists (Psst! We can help you with this).
- Digitize your rental application process: Signing leasing agreements are a little more complicated right now. Rather than having renters come in to sign, offer them a digital solution. For example, Payquad and Yuhu.io, among many others can help you expedite this process.
The bottom line
As the popular adage says, "When times are good you should advertise. When times are bad you must advertise." The multifamily sector appears to be in a position to bounce back from the downturn caused by COVID-19, meaning owners and operators should use this time to strengthen their marketing in order to be a viable option for the serious renter who is in need of a place to live in the upcoming months.