By Neil Fjellestad & Chris De Marco
The new post-recession realities in major employment and dense population areas such as Southern California means that we are likely to experience a shift during the balance of this decade resulting in dramatically increased rental household formation. Broad shifts create entrepreneurial opportunity.
Let’s take a look:
Renters will become appreciated as the customers that turn real estate holdings into a profitable rental business. Updating business management practices for operating rental property will be welcomed as an ideal opportunity to bring technological integration, investment in human capital, modern marketing and customer relations to an industry badly in need of a paradigm shift
This is an essential industry with a long tradition of being dominated by passé notions including: an attitude of “build it and they will come” devoid of input from intended rental customers, cost-driven development only providing innovations competitive with status quo among other housing providers, and a limited business vision of rental ownership as providing a necessary product instead of a competitive bundle of product and service.
We also envision this post-recession era as a renaissance of the independent rental owner as an essential housing provider and a savvy business owner in the local community. The independent rental owner is an intelligent investor that is building wealth and providing for retirement in a practical way that has rarely been available through other financial alternatives. The tired notion of a “landlord” that takes advantage of captive “tenants” belongs to the twentieth century. It will be replaced with a badge of distinction for the modern rental owner.