Benefits Packages Tenants Love
Property managers and landlords are looking for better ways to operate their businesses That will lead them to a reassessment of their business model.
New property management startups especially need a model to capture new landlord clients, scale up, and build a strong revenue stream. How you price services and package will determine your profitability.
A simple solution might be available — leveraging benefits packages for tenants.
A benefit package can help you retain tenants, raise rents and provide new streams of revenue. And it’s an exciting way to increase the attractiveness of your management services to landlords. Benefit packages may create a nice boost to your property management marketing campaigns, due to the unique value being offered.
Packaged right, with real value and promoted smartly, packaged services can give a lift to the unappreciated and poorly monetized services you deliver now. Turn that negative into a positive.
Encourage Tenants to Choose a Better Level of Service
The point of extra tenant services is to encourage them to subscribe to a premium level of service, one that is more profitable to your firm. Relying solely on percentage rent commissions may not be a desirable path in the next few years. Rent is resistant to price rises, and costs eat up your NOI, which creates pressure for you to provide extra services as budgets get squeezed harder.
Packaged intelligently, they can represent a significant value, which individual landlords can’t offer. Scale is the key. Packaged poorly with low value, and tenants may feel you’re gouging them.
More Than Adding Digital Amenities
More frequently, managers are looking to add new amenities and digital services to grow their income and bring new benefits for landlords who would otherwise go bare bones with their own landlord services.
Extra services add value to the owner’s value proposition and can improve leasing results and reduce tenant churn. Growing revenues is the trend in property management today, but it requires some imagination and marketing creativity.
Extend Services and Incorporate Essentials
There are two ways to view tenant benefit packages. One is the service extension that improves the value of services to tenants. And two, is the streaming revenue you can generate. The key issue is to incorporate benefits that make it tough for tenants to pass up on, even if you only break even on some items.
Some management firms are making these mandatory, which is okay if you’re delivering wanted value.
To get this right, consider the renter’s wish list and what they really need. Esoteric features can be included, but they won’t drive subscriptions. The more of the essential services you can include, the higher the subscription price can be, and the more of the esoteric items will be re-interpreted as good value.
A well designed package makes everything contained in it look good.
Typical benefits packages offered by property management companies are simple. Many fail to push the envelope to create value and use the package to differentiate themselves in the market. They may charge $25 to $50 a month for a basic set of services. That’s earning it the hard way.
Examples of Tenant Benefit Packages
Block and Associates Realty provides their benefits packages to their tenants. Credit reporting is one benefit renters love, and gift cards are a simple way to provide consistent monthly payback. Offering tenant portals (software) is another feature millennial and Gen Z renters appreciate too. The message: value, service, convenience gets across to them.
Premier Properties describes their tenant benefits package:
Focus on Big Picture Value then Make it Compelling
If you include several essentials in the package, then tenant’s will see the value better. It may take some planning, strategy and skill in marketing these benefit packages. Services never sell themselves. You must do marketing and promotion to get the value across to tenants.
Tenants normally must buy cable, internet, renter’s insurance, so these will make the package look like a must have subscription. To be significant enough for them, a broad mix of services that make life easier for them, including forgiveness clauses for issues they may experience (such as late rent payment) makes it irresistible.
It may be important not to provide some services for free, and only make your main rent price include the bare necessities. It’s not uncommon for renters who like the reasonable rent price to upgrade so they can feel special and comfortable and get maximum value.
There is definitely some psychology in packaging benefits. You may want to interview several of your tenants to gauge what they feel most strongly about.
20 Tenant Benefit Features you might include are:
- renter’s insurance benefits
- pay anywhere rent payment
- credit reporting benefit
- tenant portal usage
- free air filters
- smart home features
- free 5G wifi unlimited bandwidth
- free gift card giveaway every month
- high speed internet plus television subscription
- lawn, snow removal and landscaping
- carpet cleaning and home cleaners
- TV wall mounting
- dog walking
- one time late fee forgiveness
- missed maintenance appointment fee waiver
- online tenant portal (via property management platform)
- maintenance hotline, concierge service
- reduced security deposit amount
- swimming pool cleaning
- exercise room and party room access
The Keys to Successful Tenant Service Packages
The key to success with the package subscription is to make it desirable, meaning they are saving money and receiving essential services, thus making it undesirable to turn your offer down.
Renters may prefer to go it alone to save money, and buy their own tenants insurance, services etc. So the value proposition has to be clear, convincing, and easily seen to be the smartest choice. They assess value based on big, painful expenses they have. You’ll need to create a well written service features page on your website, along with blog posts, and perhaps include a customer testimonial when you can get one.
At an extra $99 to $199 per month, the benefit packages can drive significant additional revenues. In compiling a benefit package to grow your revenue streams, it must be worth the effort and be well conceived.
Manage it All on the ManageCasa Platform
You will be able to manage the subscription via ManageCasa’s software solution. It’s a key point of value in next generation, cloud-powered software that they give access to revenue generating services. And they’re easily administered digitally, which is what today’s renters want. You’ll be validating their preference. This is the future of property management.
Fees will be automatically paid each month, driven by your lease agreement. This automates the process so you won’t have to do manual adjustments and make errors.
Find out more about how to use ManageCasa to increase efficiency, performance and profit.
See also: Evaluate Property Management Software | Growing Revenues | Property Management Automation | Workflow Automation | Choosing Property Management Company | Find Property Management Services Firm | Virtual Rental Leasing | Business Efficiency | Property Management Conferences | NARPM Conference 2022