As the year draws to a close, many members of the housing industry–developers, brokers, real estate agents–are crafting their budgets for 2008.
Property managers are no exception. And, according to U.S. Census Bureau information, keeping costs down might soon be even more of a pressing concern for residential property managers.
Rent appears to be contributing less to new apartment budgets: The median asking price for all new privately financed, nonsubsidized, unfurnished rental units in buildings with five units or more in the first quarter of the year was roughly $102 lower than the asking price in the previous quarter, the latest Census rental data showed.
There has been speculation that, as foreclosures rise and home mortgages become harder to get because of tighter lending restrictions, renting will be on the rise in the U.S.
However, if oil and energy prices keep increasing and rent falls in 2008, many property managers may find themselves looking to make the most out of every allotted budget dollar–and cut costs wherever possible.
A few suggestions:
- Get the Word Out Wisely. Promoting your property can be challenge when coupled with maintaining and managing it–which is why property managers often find purchasing combined print and Internet ads can save time and reach a solid amount of potential renters.
An August 2007 study by Watertown, Mass.-based marketing firm iProspect found 39 percent of Internet users make a purchase after being driven to Web sites from off-site marketing–print ads and word-of-mouth are the two largest influencers.
Although several national newspapers have recently reported their online and print real estate classifieds aren’t selling well, managers may reap benefits from listing rental properties.
The latest edition includes a region in North Central/Northwest Indiana and Southwest Michigan.
"ForRent.com-The Magazine merges print apartment listings with its Internet listing on ForRent.com," says Anita Williams, ForRent.com-The Magazine regional manager. "Since the magazine’s introduction in eight other markets, property managers in these areas have seen phone leads increase by an average of 315 percent, according to our LEADS Management System."
- Cut Costs. Save the World. Many property managers are finding that reducing energy usage can be good for the environment–and for their building’s budget.
Consider seeking out events like the roundtable that New York-based US Energy Group, which offers a number of products to control, manage and monitor building energy usage, held for property managers in late November.
Participants discussed ways to reduce energy use and–of course–save money. Covering topics like water usage, HVAC savings and government incentives, the two-hour event brought energy experts and property managers together in Great Neck, N.Y.
- Be Smart About Taxes. Global accounting, tax and business advisory organization Grant Thornton International’s Construction, Real Estate and Hospitality Industry Group recently released some tax tips to help property managers prep for 2008.
Among the highlights: Grant Thornton suggests reviewing your deferred compensation plans in light of complex new rules that will affect plans resulting in a compensation deferral. The rules, which should take effect at the end of this year, can speed up taxation to recipients–along with interest and penalties–if violated.
The company also advises property managers to conduct a property tax review to see if any opportunities to lower property tax valuations on real property exist and to make sure all real property is separate from the personal property tax base.
It’s worth the time: Potential tax–and other–savings could last for years.