2023 Renters in San Diego, will be very unique in comparison to the last few years. As we enter this uncertain economy we must really consider if they way we’ve been operating can continue. If you ask me the answer is no. Time for change is now.
Rental Rates
In 2022 we saw leasing halt almost over night in October. We thought maybe election related but it continued through the holidays. We as property managers need to be more conservative with rental rate. It is back to basics here. Competitively priced and well-maintained products will be rented. The leasing summer of 2020-2022 is long gone. It is going to take work, and professional skill to navigate the 2023 leasing.
According to Zillow, 64% of renters are considering a move in the next three years. 47% are considering in 12 months or less.
Many renters are avoiding signing long term leases as well. Our own portfolio has seen more month-to-month requests than ever. This vulnerability is scary for owners and managers. At one-point residents too, but they now seem to appreciate the fluidity of choice when renting.
What do they want?
No, this is not the scene in the notebook where Noah asks Allie what she wants. Although now that’s all you can think about. But, back to what renters are going to want in 2023
- Budget- if its not in their budget they don’t care.
- Size- Beds/Baths-The 1/1 units are going to struggle. With more work from home demands people want space.
Less than 16% could care about amenities that were once the main focal point. Pet areas, business centers, gyms, roof top deck or garden are barely even asked about.
Pets
We have been saying it for a long time, but the numbers are in. Accepting pets will make or break your rental. According to Zillow, in 2018 46% of the renting population has a pet. In 2022 it rose to almost 60%. So, if you aren’t reconsidering your pet policy you are really making leasing difficult.
Major Takeaways
In 2023 our goals will be to retain good, long-term renters. Our analysis of rental value and negotiation will be imperative. Avoiding turnover will be number one. For our multi family properties investing in amenities will be obsolete. The individual unit condition will be more important.
