What Tenants Want in Today’s Market

While Lingsch Realty’s vacancy levels are back to pre-COVID levels, that doesn’t mean we are out of the woods yet.

While rents are creeping up, gone are the days when tenants are lining up to submit their applications and are desperate just to find a home within their budget.

With the COVID-19 Delta variant keeping many city activities off the table and employers constantly shifting return-to-office policies, many tenants are still identifying their apartments as a live-work oasis, as opposed the crash pad it once was.  In addition, with the complete shut down in the near recent past, tenants aren’t soon going to forget how much time they were forced to spend at home, and therefore continue to be picky about their abodes.

Just a couple years ago, tenants were willing to pay less for a clean, yet outdated kitchen and bathroom. Those units are now sitting unrented. With so many new residences coming available in the last couple years and the current renter’s market, tenants will no longer settle for subpar finishes, fixtures and appliances. Inside their apartments, tenants are looking for clean, spacious and updated apartments with tons of natural light and enticing views.

Any apartments that are currently vacant should be upgraded to include the following:

  • Updated kitchens including white or grey cabinets, quartz countertops, hardwood, luxury vinyl or tile floors, stainless steel appliances and dishwashers
  • Updated bathrooms, as tenants are more aware of germs and scorn living in previous tenants’ used spaces

With tenants still looking to social distance and spending the majority of their time at home:Tenants prefer in-unit laundry so they can avoid interacting with other residents.  At the very least, you must have laundry on-site in order to get an apartment rented in this market.

  1. Tenants are looking for well-maintained common areas. Landlords should update flooring in lobbies and halls and add fresh, light-colored paint and bright light bulbs.
  2. Tenants are still craving outdoor spaces. The space doesn’t have to be fancy. Just a clean spot with a sitting area and some plants will work.
  3. Package security is paramount. With package theft an unresolved issue in San Francisco, tenants crave a safe place to store packages. At one building I manage, we installed a code lock on a closet and made it a communal effort to keep packages safe. If a tenant sees any packages in the lobby, we ask that they put the package in the closet to keep the package safe until its intended recipient can retrieve it. The building has been impressively cooperative resulting in less package thefts for our current tenants and prospective tenants are impressed by our proactiveness.
  4. Tenants are paying more attention to building Internet options. While tenants could be patient when downloading a movie, they are less tolerant of data speeds while they are working from home and having to bear multiple Zoom calls a day. If a wired option such as Comcast or AT&T Fiber is not available at your building, consider installing an antenna through Monkeybrains, which sometimes provides higher speeds.

To put your apartment over the top, tenants are looking for the “wow” factor.  To attract the city’s more tech-savvy tenants, smart devices are becoming more impressive to prospective tenants and may push your apartment offerings above others.  While Smart features can easily be overdone, a number of Bluetooth-enabled smart home devices are actually worth their price for adding security to your building and comfort to individual apartments.

Some devices you can install are:

  1. Programmable thermostats. They not only look cleaner than their 1970’s counterparts, which are still commonplace, they also save energy and therefore, save tenants money. A lot of tenants are being more frugal these days because they have been sheltering with family and therefore, had the luxury of not paying rent and are now more aware of where they can cut costs and save.  
  2. Smart blinds. Going along with the trend of tenants spending more time indoors and working from home, the option to adjust your blinds remotely while on a video conference call is more appealing than ever.
  3. Smart locks. Tenants are used to everything being on their phones. Their physical wallets have been replaced by Apple or Google Pay, so why not let them leave their physical keys behind as well. Smart locks allow tenants to unlock their doors from their phones making physical keys redundant. Many smart locks also offer the option to give guests temporary access, which is a convenience many tenants appreciate, especially those that may need to let in dog walkers or cleaners while they are at work. This will also cut down on after-hour lockout calls, and rekeying expenses in between tenants. Tenants can unlock from their smart phones and you can reprogram the door yourself. With tenants getting used to having everything at their fingertips, it is natural that keys will be the next victim of the smart technology revolution now that the technology is readily available and affordable.
  4. Intercoms with video and smart phone capability. Along with smart locks, tenants would love to not need keys to access the building. New technology allows this reality. Also, tenants will be going back to work soon, so having a way to remotely buzz in delivery people so the tenants can receive packages even when they aren’t home is desirable. In addition, 5G cell phone technology ubiquity is rendering some analog intercoms obsolete. Don’t settle for an inexpensive stopgap solution.  Make a technology leap in this area to impress prospective tenants with your attention to details and put your apartment offering above all others. Tenants get so many deliveries these days that buzzing open the gate from their intercom or cell phone is almost involuntary. However, this means that some undesirable people make it into the building. And no matter how often you warn tenants not to buzz in everyone, they continue to do it. Giving tenants the option of a video confirmation of who is coming in the building may make them think twice about buzzing someone in. You can resolve this issue by installing intercoms with video capability that allow tenants to visually verify a delivery person or visitor prior to granting them building access.
  5. Outlets with USB ports. No one likes searching for a charger box. Make tenants’ lives easier by installing USB outlets in areas that are convenient for charging such as kitchen counters and the probable placement of a tenant’s bed.  The outlets are not expensive and you only need one or two per apartment.

As one of my tenants put it “why should I pay San Francisco rent prices during the pandemic, while all the great things neighborhoods have to offer are gone, and all the bad things (i.e., homelessness, crime and vandalism) are prevalent.”  While previously tenants enjoyed being in the hustle and bustle of the city, during the pandemic with everything closed, that bustle was coming from homeless encampments that have parked inside most neighborhoods. Thankfully San Francisco’s leadership is finally addressing the homeless issue. However, tenants are still looking to less congested areas such as the Richmond or Sunset Districts as they look to escape the disheartening parts of the city and are looking to get closer to parks and beaches.

While I realize having rents lower than you once received is frustrating and stressful, we need to remember that real estate investments are long-term. Landlords have seen rapid gains in the years preceeding 2020. We will get to those prices again and will even see increases. By setting the your building’s best foot forward now, you will be setting yourself up for many happy returns for years to come.