In today’s housing market, a market correction could happen at any time. What is a market correction exactly? In its simplest form, it’s a rapid change in the price of a commodity within a given market. For the real estate market, this means that, at any point, a market correction could happen and the market could experience a downward movement. Investors need to take careful steps to protect their assets should such a correction happen.
Investors should consider upgrading their strategies. By this, it simply means implementing changes that matter most to residents. They can have things added for residents that would increase the resident retention rate such as an on-site laundry facility, free wireless internet throughout the building, or even a new or updated gym facility. Not only does this increase resident retention, it increases property value as well. Potential residents will see these amenities and be attracted to them.
The residents of these buildings should have convenience while they are residents. Utilize the latest technology available so residents are able to make rent payments online, submit a maintenance request, and perform their lease renewals. A large majority of residents or potential residents own a pet or will want to own a pet. Adding services such as pet-washing or pet-walking increases the property’s appeal and will reach out to a higher demographic of residents and potential residents.
A property should feel like a home for the resident, not just a place they’re staying for a year or so. A study was done by the Journal of Environmental Psychology that shows that “place attachment” happens when a cognitive bond occurs when someone feels an emotional connection to a place and those associated with it. Investors, owners, and managers can offer this sense of community by having a community room within their property, an outdoor lounge, tennis courts, basketball courts, and a swimming pool, to name a few. This also increases resident retention rate as these are considered amenities. Each person that a resident comes into contact with that works for the property should be treated as a special relationship and an individual relationship. The residents shouldn’t be made to feel that they are simply a rent check that comes once monthly. This helps with resident retention even if the market correction hits.
These changes should be implemented proactively and not after a market correction occurs. Strategically updating properties, making residents’ lives easier, and putting forth an honest and real sense of community will help improve the chances of a property becoming recession-proof should the market correction occur.