Human resource issues, operational efficiencies, and maximizing revenue are the top three challenges facing rental housing providers, according to an online survey conducted by the National Apartment Association (NAA) and ndp | analytics and sponsored by AppFolio.
“The property management industry has undergone many changes in the past year; however, some of the pain points experienced around staffing and recruiting and operational efficiencies were already in place prior to the pandemic,” according to the survey. “Remote work, emerging market trends, and shifting expectations from both employees and renters have changed the real estate landscape indefinitely.”
The survey, which received 1,048 responses in July and August, found that HR, staffing, and recruitment was the biggest concern for rental housing providers, with 74% of respondents selecting it as one of their top three challenges.
Attracting new team members, training new hires quickly, and reducing turnover were ranked as the most difficult tasks. In addition, according to the survey, it’s a struggle to keep on-site offices staffed because of higher salary demands, low morale, COVID-19 concerns, and labor shortages.
“Employees are exhausted from COVID-19,” noted one survey respondent. “They are demanding higher pay. Hiring is extremely challenging. Recruiting maintenance is very difficult. Salary demands are high. Morale due to short staffing and high expectations from residents is challenging. The phones are ringing off the hook, and we cannot keep up with customer service and the instant gratification of wanting answers immediately.”
Rental housing providers are making efforts to solve the challenge, with some providing sign-on bonuses, increased pay, and enhanced benefits. Respondents also called for policies supportive of increasing the size of hiring pools; more industry education programs in high schools, colleges, and trade schools; and more promotion about the industry to attract new workers.
Almost two-thirds of survey respondents, 63%, ranked operational efficiencies as the second most common challenge. Within that area, rental housing providers drilled down on finding high-quality vendors, reducing labor-intensive processes, and reducing costs as the top issues. According to the survey, changes brought on by the pandemic have led owners and operators to rethink strategies for improving their bottom lines as well as employee productivity.
“Operational efficiencies—we are trying to find the right tool to build out and track tasks that will do three things: Ensure the team is running like a well-oiled machine, the daily operations are being completed, and that teams are being held accountable,” said a survey respondent.
Using better software and engaging in more communication among on-site staff, corporate, and suppliers are a couple of the solutions already being put in place. However, survey respondents said technology and software training, best practices for operational processes, and less paperwork and reports would help them solve operational efficiencies.
The other top challenge cited by 48% of respondents was maximizing revenue, especially as many have seen escalating expenses and rental income losses due to the impact of the pandemic. Rental housing providers ranked increasing net operating income, mitigating bad debt loss, and returning performance to pre-pandemic levels as the most difficult tasks.
“Costs are escalating much faster than rents can be raised, and housing is becoming less affordable for many of our clients,” noted a survey respondent.
Some of the solutions respondents said they are finding include helping residents with the emergency rental assistance process, starting to increase rents, and upgrading units to attract new residents. They also called for faster distribution of the emergency assistance funds as well as less regulation.
