Tracking performance is important to any business. Whether it’d be across a social media platform, corporate website, or a Google results page, it’s vital to see where you stand in comparison to your competition. This is exactly why Key Performance Indicators, or KPIs, typically come in handy for many businesses, serving as a source of invaluable information for any ambitious leasing team.
Defined as measurable values that demonstrate how effectively your company achieves business objectives, KPIs offer a comprehensive way to measure the health of your multifamily property. They can better inform your business approach, help your team gain worthwhile leads, and ensure resident satisfaction. In fact, applying and evaluating various KPIs to your business strategy is beneficial across all industries in some way, shape, or form.
Even still, you might wonder how best to establish worthwhile KPIs, so you may receive the proper intel needed to accomplish your end-goals. Too often, companies blindly adopt certain KPIs, and then wonder why they fail to advance their business initiatives. The reality is that every business is different, even in the multifamily sector, and there are no one-size-fits-all to KPIs. To inspire your very own strategy, we’ve compiled a short list of the top KPIs to consider tracking in 2021 and beyond.
Occupancy and Vacancy Rates
Occupancy and Vacancy Rates is arguably the most fundamental KPI for multifamily professionals to track, since it reveals how fully leased your community is at any given time. Of course, it’s important to remember that the current state of the economy has increased apartment vacancies. Recent numbers show that 28 percent of property managers are holding on to empty apartments for longer than usual. Even still, using your PropTech provider’s analytics dashboard to track these figures is a great way to ensure that your team is doing everything to meet their target occupancy rate.
Average Days to Lease
Referring to the number of days your apartments remain vacant until a new resident moves in, Average Days to Lease is an indispensable KPI to track in our industry. It will help you determine how long, on average, your apartments remain empty and how many dollars you spend on these vacancies. No community wants to maintain dozens of vacant apartments, so this measurement will go a long way in helping your team fine-tune your leasing strategy and boost future occupancies. Once you understand your community’s Average Days to Lease, you can work on developing new and creative marketing ideas that will encourage renters to sign or renew their lease, like a look and lease application fee discount or a complimentary gift card upon renewal.
Resident Turnover
No matter how attractive your apartment community is to searching renters, it is far more expensive to pursue and place new residents than it is to retain the ones you already have. Once you factor in all of the expenses associated with marketing and preparing an apartment for leasing, high resident turnover rates can easily cost you thousands of dollars per month – and that is just for a single vacant apartment. That’s why the most seasoned multifamily professionals turn to Resident Turnover KPIs to take note of how many residents are moving out, in addition to how long they were with your community. Is it long-term residents who are vacating? How many short-term renters decide against extending their agreements? Confirming this type of information help you refine your retention strategy, particularly when it comes to resident satisfaction.
One of the best ways to stay on-track with your business goals is to measure Key Performance Indicators, such as these. Doing so will allow you to take an objective look at your business’ overall health and identify the areas in need of improvement. After all, you cannot monitor what you do not measure, and failing to do either is sure to harm your community in the long run. Though the process of managing and tracking KPIs may initially seem burdensome, the work is sure to pay off once you are able to get an all-encompassing view of your community’s performance.
AUTHOR
Kerry W. Kirby is a renowned entrepreneur, technology innovator, and philanthropist. He is the founder and CEO of 365 Connect, the leader in providing the most advanced automated marketing, leasing, and resident engagement platform for multifamily communities across the globe. Executing on a progressive vision of creating leading-edge products and services, Kerry has won more technology awards than any other company in his home state of Louisiana, as well as the industry he serves. Prior to founding 365 Connect, Kerry worked in the multifamily housing industry developing communities across the Southeastern United States. Kerry’s eye for finding buildable sites with incredible locations was his formula to creating an array of successful ventures.
Kerry W. Kirby has earned widespread recognition and numerous prestigious awards throughout his career. His accolades include the Louisiana Governor’s Technology Award and Titan Entrepreneur Award, both highlighting his outstanding contributions to the tech industry. For nine consecutive years, he has been listed on the Silicon Bayou 100 as one of Louisiana's most influential entrepreneurs. Most notably, Kerry became the first in the multifamily housing sector to receive the Bootstrapper Award, underscoring his remarkable journey of turning a scrappy startup into a leading proptech powerhouse without external funding.
Kerry W. Kirby serves on the Board of Advisors of Rainbow, a national nonprofit organization that provides service-enriched housing programs for over 32,000 affordable housing units across the country, and general-partner services to an additional 12,300 units. He is Chair of Technology Initiatives for the Multifamily Innovation Advisory Council, an executive membership level organization with over three million multifamily units represented, focused on assisting owners and operators explore innovative solutions that will drive change across the industry.
Kerry W. Kirby and his wife Melinda M. Kirby are actively involved in supporting communities and causes, with an unwavering dedication to humanitarian, educational, healthcare, and equality programs. Through the Kerry & Melinda Kirby Foundation, they provide resources to nonprofit organizations that accelerate progress by championing causes that give a voice to those that are often not heard. They have been highly recognized for their philanthropic commitment, being honored with a Communitas International Award for their significant impact in making a difference in people’s lives.