Whether you’re new to the rental market or an experienced property owner here, you’ll need to know where the market is going and how you can best position yourself and your property investments for success. As professional property management and real estate professionals, we are constantly watching the trends and measuring their outcomes. We like to stay a few steps ahead of what’s coming; it helps our clients and it allows us to prepare for shifts in the market and the demands of our residents.
There’s also the industry. We stay on top of best practices in property management, and we learn from our networks and our partners.
Currently, what we’re looking at in our area of Southern California is higher rental values, a strong demand for rental properties, and the emergence of new technologies that are making it easier to rent out a home to qualified tenants.
Tenants are more educated, too, and willing to be direct about what they want and need from a rental home. They’re looking for good experiences, and if tenant retention is a goal of yours (it should be), creating a welcoming and supportive environment for your residents is absolutely required.
Let’s take a look at the future of real estate through the lens of emerging trends in property management this year.
Understanding the Current California Real Estate Market
We’re going to talk about the future, but in order to do that, we need to understand how to navigate the current market and the existing trends in property management. California has long been a hotbed of real estate activity. Rental prices remain high, yet the nature of the market is evolving. The cost of entry remains high, too.
Here’s how things look right now:
Rental Demand in Playa Vista, Westchester and Playa del Rey
Rental dynamics have been experiencing a noteworthy shift in our market over the past 4 years. Rental rates have increased along with demand. In our markets, we feel this shift is a reflection of the high interest rates. The higher rates are pushing some would be buyers into renting for a period of time while they wait for a change in rates. We continually stay on top of inventory, pricing and demand in our markets to ensure our clients are well informed.
Laws and Regulations
California has always been known for its strict tenant protections.
Those laws are getting stricter. You’ll have to be prepared to understand them and comply with them in order to successfully rent out property now and throughout the near future.
Remote Work's Impact on the Rental Market
Remote work's transformative effect on the workforce is leading tenants towards new housing preferences, and it’s also requiring property owners to create environments that are attractive to this growing tenant pool. The tenants who work from home can live wherever they want. Instead of staying in San Francisco or Seattle for their jobs, they can choose any place to call home and still maintain their salaries and their work stability. This is generally a win for both tenants and landlords.
Embracing Sustainability and Energy Efficiency
Over the last year or two, sustainability has emerged as an important part of what tenants are looking for when they rent a home. California, of course, has always been a leader in environmental protections, and it’s translating into good business. Homebuyers and renters are becoming more conscientious about the environmental impact of their properties, leading to a growing interest in energy-efficient homes. Adopting renewable energy sources and optimizing buildings for energy conservation can increase property value and appeal to eco-conscious tenants.
Property Management Technology Trends
We cannot talk about property management trends without also talking about technology.
There has been a shift in both how we use technology as real estate experts and how we provide technology as property managers and rental owners.
For California property managers, we know that the right tech tools can help us do our jobs and serve our owners and tenants more efficiently. We use technology to:
Communicate. With online portals in place for our owners and our tenants, we can make it easy for residents to pay rent online and request routine repairs. This contributes to fewer late rent payments and better communication. Owners use their portals to see financial statements, check maintenance invoices, and send us messages. We’re available through text and email and always on the portal.
Respond to maintenance. We use technology to track the performance of the systems and functions of your home. We know when the last roof issue occurred and we know how old your appliances are and whether there’s anything left on their warranties. This helps us to schedule preventative maintenance services and it also allows us to advise you on what should be budgeted for future repairs and replacements.
Provide accurate and detailed accounting. We’re able to be more transparent with your money thanks to our accounting technology. You can get income and expense reports in real-time. You can ask for customized reports that our property management software system is able to provide. You’ll always know where you stand financially.
Our platforms, software, and technology resources allow us to manage your home more efficiently and cost-effectively.
That’s the technology we use. There’s also the technology we provide.
Tenants in California are increasingly looking for properties that offer smart home technology. This is an important trend that we tell all of our investor and landlord clients to watch for: tenants wanting and needing extra tech in the homes that they rent. When you want to make your property more competitive on the market, make sure you’re providing the right smart home upgrades. These are the things that attract those well-qualified, highly sought-after residents.
Residents we talk to are currently using and enjoying video doorbells, smart thermostats, and apps that allow them to turn on lights and lock doors remotely.
Those high-quality tenants will continue to look for homes that provide smart home technology, and the property owners and managers who can provide it will have an easier time attracting and retaining their perfect tenants.
There are additional benefits to installing smart home technology in your investment properties.
Saving money. By remotely managing various systems within properties, such as HVAC, lighting, and security, energy costs can be reduced for property owners and tenants, even while efficiency and productivity are increased. When you have to pay for energy and electric bills during turnover periods and vacancies, you’ll be glad that your technology is keeping those costs down.
Convenience. Tenants will appreciate having greater control and convenience. They’ll respond favorably to rental homes offering smart home technology. This creates a great relationship with your residents right out of the gate.
Security. Smart locks allow remote access, which is both secure and convenient. The smart locks or digital keypads allow for easy property showings, and they also allow maintenance workers to get inside the property without someone running over there to meet them or make another key.
When you’re willing to invest in these technologies for your California rental property, you’ll find you have access to a variety of advantages, all of which will increase your rental values, protect the condition and value of your investment, and ensure your property remains occupied with excellent tenants.
Trends in Tenant Satisfaction and Retention
It’s a trend that’s been picking up a lot of momentum over the last few years: customer service. This is not a new trend when we’re talking about property management in California, but it’s something that we’re going to be talking about more and more. The technology we discussed? That automation and data collection means that we can spend more time focusing on relationships.
Providing an exceptional tenant experience in your rental home is an excellent way to grow a business and it’s a trend that will continue to develop into more meaningful outcomes.
Landlords and property managers need to invest in their tenants. These are your paying customers. When you’re focused on advertising and marketing more strategically, investing in objective tenant screening, and committing to great customer service for your tenants, you’ll be satisfied with the results that you achieve.
Property management is your best resource when it comes to tenant satisfaction. We can focus on the relationship and make sure they’re getting everything they need during the tenancy.
The real estate market is always changing. The property management industry is always growing. While we don’t have a crystal ball that can tell us the future, we have a sense of what’s coming and how to best prepare for it.
If you’d like some help, please contact us at Fostr Property Management. We serve owners and their properties in communities such as Playa Vista, Westchester, Playa Del Rey, and surrounding areas.
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