Tampa Property Management Tip #4: Tips for Leasing Houses in a Competitive Market
When competing for tenants in your rental market, your Tampa property management company should aggressively pursue different marketing strategies. An excellent strategy is offering a no application fee for all applicants.
Most Tampa property management companies get really uncomfortable with this idea. Applications fees collected from tenants is often a profit center. If you charge a client $50 for a rental application, you usually spend $15 in fees to pull credit, criminal, and evictions reports. It is only $35 in profit per application but that number ads up if you are doing 30-50 applications a month. Obviously, there are costs related to checking the rental and job history for the tenant. This usually takes only a few minutes.
The issue is getting a house or condo rented quickly in a competitive market. Stress Free Property tells its tenant prospects that, if they look at the rental property today and fill out the application, the application fee will be waived. You need to consider the reality of the tenant searching for a rental home. The tenants usually have a list of 5 to 8 properties to see. Your property is somewhere on that list but usually not at the top. Prospective tenants fear paying $30-$50 on an application only to be denied. If you are offering to waive the application fee, your rental property often jumps to the top of the list.
You may be thinking that you will have a ton of unqualified people putting in applications. Part of the reason for charging an application fee is to qualify people and make sure there serious about renting. You would be partially correct in this remark; however, you simply need to do a better job of pre-qualifying people before allowing them to view the property. At Stress Free Property Management in Tampa, we say the following, “The owner is looking for someone with good rental history without any evictions or money owned to another landlord. You must have a job or some sort of income we can verify. And we pull criminal background. Would this be okay in your situation?”
The prospect should say “yes.” If you hear a story, the person is unqualified most of the time. By getting good at pre-qualifying tenants before they fill out an application, you typically only have to run 1 or 2 applications to find a good tenant. At worst, we run 4 rental applications to find a good tenant. This is an excellent tradeoff to rent the house quickly. We have found properties will sit for weeks or even months because there is no incentive for prospective tenants to tour our property quickly or at all. You are basically investing $15-$45 dollars to become a priority in the prospect’s search.
The incentive should be explained in the following way: “If you look at the property and fill out an application by tomorrow at 5:00pm, we will not charge you an application fee, which saves you $50.” This statement gives a “call to action” for the prospect to move our rental property to near or at the top of their search. In our Tampa property management company, we have found that the number of clients touring our rental properties has tripled , using this one technique.
