I am wondering if you are going to participate in something that it seems most everyone else has chosen to participate in. Before I tell you what most people have decided to participate in lets talk about the herd syndrome.
Most people are guilty of following the herd, or, they see what everyone else is doing and they follow suit. They get an idea of what everyone else is thinking and they follow suit there too. It is this principle that then gets people into trouble. The thinking of “since everyone else is doing it (saying it or thinking it) then it must be the right thing to do” OR the right side of the track.
Apartment property owners cannot afford to act or think in this manner. There is far too much at stake here and I am NOT just talking about money or property—that is a BIG part of it — but I am also talking about the ‘collateral damage’ kind of stuff like frivolous lawsuits, claims by tenants or vendors and the drain of time and energy on you that comes with doing what the herd does. The lesson for us apartment owners is to never follow the herd—if they go one way we go the other.
So now the herd is on the bad economy kick and I wonder…are you participating? It is interesting that even close to home here in The Heartland that many are going into the bad economy trap and following the herd ever deeper into this quagmire of crap.
We as apartment property and commercial investment property owners in The Heartland have recently seen:
- Some of the best occupancy numbers in years.
- The biggest jump in rents in years, again, before the flood.
- The best climate to reduce property taxes on apartments in decades.
- The ability to charge more for other items such as laundry, garages, heat , etc.
- The best list of available tenants that want to rent your apartment property. It was not that long ago that you would have 10 people look at the apartment you had for rent and you did not want a one of them to live there.
I could go on but you get the picture. And it's not only The Heartland but many of the areas are seeing nice returns and a rebound in the apartment market. You see no one wants to talk about these things the doom and gloomers want to talk about the price of gasoline and how that will effect what you can charge for rent…and that brings me to a very important point.
Don’t you fall for this!
Here is where you cannot let this kind of stuff get to you. There will be people that think you owe them or (tenants) a free lunch. There are a lot of people (I call them gomers) that want you to lower your rent because Joe and Sandy have to pay $4.00 a gallon for gas. There are those that want you to not raise rent this year because the price of lettuce has gone up at the grocery store.
When your water bill goes up 20% or your natural gas goes up 30% you should just pay that cause you are an apartment property owner and NOT pass it on to those poor tenants. When this challenge comes up and if it has not yet hit your doorstep I assure you that it will, make sure you remember what it was like with low occupancy, make sure you remember what it was like when you had a 20% increase in your property taxes or when you spent hours fixing those units up that the non rent paying tenant destroyed on his way out.
Clipping coupons and buying “How To Survive On Ramen Noodles and Duct Tape” is not the ticket to success as an apartment owner but that is what the masses want you to believe and if you don’t you should feel sorry for these poor folks and not make a profit yourself you bad investment property owner you. Ignore the masses and go against the grain and with that you will be among the successful minority.