Top 3 Challenges for the Rental Industry
Operators of all sizes are facing similar issues, according to NAA’s nationwide survey.
Regardless of the type or location of owned or managed property, every apartment industry company is confronting the same primary headwinds.
At the top of the list of challenges is the recruitment and retention of staff. Almost three-quarters of housing providers deem this one of their top three challenges, underscoring the pandemic’s impact on long-term sustainability and growth.
These are among the major findings of a National Apartment Association (NAA) survey conducted in July of 1,000 respondents, of which 30.6 percent were from companies with 500 or fewer units.
“No matter what region and what role you play in your company, recruitment and retention were the biggest challenges,” Paula Munger, associate vice president of industry research and analytics at NAA, told Multi-Housing News.
“The demand for apartments now has resulted in more companies needing to hire,” she continued. “They are having to offer signing bonuses, it’s super competitive. It’s hard to make your offer stand out if you don’t offer competitive pay, a competitive benefits package and flexibility, which is crucially important these days.”
The second most commonly seen challenge by respondents was the need for operational efficiencies, Munger said. Respondents were asked to rank the operational tasks regarded most daunting. Finding high-quality vendors represented the number one challenge. The second was freeing up team members from labor intensive processes and the third reducing costs. NAA learned from other surveys costs rose last year during the pandemic.
After the need for operational efficiencies, the third most commonly-seen challenge was lost rent, more severely impacting smaller companies, she added.
“We did ask them what they were doing to solve for these problems now, and what they needed,” Munger said.
“They are offering sign-on bonuses, increased pay, enhanced benefits and they are using recruiters. What they still need are policies supportive of increasing labor pools, and certainly more industry training in high schools, colleges and trade schools. There are many positions in this industry that don’t require a college education.
“They are also looking to create programs that promote the industry to attract workers. There is a lot of churn in the industry. We need to see the labor pool open up, and one way to do that is to advertise the industry and all the benefits it offers.”
The ultimate takeaway from the survey? “This really underscores how hard the pandemic hit the industry last year,” Munger said. “There remain a lot of operators that continue to be impacted and are still in recovery.”