It’s time to capitalize on these 3 rent payment trends
The pandemic has accelerated the adoption of technology that makes rent payments more convenient, efficient and flexible for property operators and tenants alike.
Instead of collecting and depositing rent manually every month, property owners can automate the process and free up time to focus on what they do best: manage properties, grow their businesses and build positive relationships with tenants.
Three major trends are shaping the future of rent payment technology. Capitalizing on them today can help you optimize and modernize your operations for tomorrow.
1. Tenants don’t just appreciate convenience - they expect it
Domenick Ferrera is VP of Commercial Real Estate Digital Revenue at JPMorgan Chase, as well as a self-taught investor who owns and operates eight units across three multifamily properties in Westchester, New York.
Ferrera explains the technology consumers use every day for shopping, entertainment, transportation and more has shaped their expectations for service and speed in all aspects of their lives — including paying rent. “The Amazons, Netflixes and Ubers of the world are providing a solution that's very efficient and very easy,” he says.
Benefits of digital rent payment
|For property owners||For tenants|
|Integrate payments with accounting software and other operations tech||More payment options, including ACH electronic transfer, debit and credit card|
|Socially distanced rent collection||Safe and secure digital payments|
|Receive payments quicker||Send payments anytime, anywhere|
|No mail delays or trips to the drop box and bank||No physical checks and stamps|
|Send recurring reminders||Set up automatic payments|
|Track payment histories||Easy access to digital rent receipts|
|Eliminate human error||Avoid late penalties|
The ability to pay digitally is especially important to millennials and Generation Z renters who are accustomed to carrying out transactions online with the touch of a button.
“It's going to become more and more like table stakes for landlords to provide these easy-to-use solutions to collect rent,” Ferrera says.
And it’s not just tenants who benefit.
“You make your life a little bit easier, and you serve your tenants’ needs by giving them an option to pay in a more streamlined and efficient way.”
Top reasons owners/operators adopt rent collection software
Top – rated rent collection software features among owners/operator
Source: Rent collection trends in commercial real estate, JPMorgan Chase, Dec. 2, 2020
2. Beyond efficiency: Use rent collection to inform business decisions
“Any time that I spend on maintenance requests or doing rent collection manually is time that I’m not spending finding new leads and growing my portfolio,” Ferrera says.
As the rental industry grows more complex, emerging innovations can help property owners maximize efficiencies and gain valuable insights to make strategic decisions backed by data.
These all-in-one solutions provide a holistic view of the business by syncing rent collection with other aspects of managing investment properties, such as:
- Tracking property information, upcoming tasks and maintenance history
- Managing and forecasting repairs and maintenance costs
- Gathering and analyzing local supply and demand data, occupancy rates, rent prices and demographic trends
- Identifying and capitalizing on new investment opportunities
To find the best system for your property, Ferrera recommends asking key questions to vet your options.
- Is the platform designed for the number of units I manage and type of property I own?
- Is the platform intuitive and easy to use for both me and my tenants?
- Is my data stored safely?
- What are the subscription costs and are there add-on fees?
- Beyond rent collection, what other tools or features does the platform offer?
- Have I ever heard of the company behind the platform? Does it have a good reputation?
- Does the platform offer customer service?
- Is the platform compliant with local laws and other legislation that affect my properties?
3. Payment flexibility is the X factor for attracting and retaining tenants
In addition to digital rent payment options, flexible payment policies have become a deciding factor for many renters. Capitalizing on this shift in tenants’ priorities can help property owners stand out in a competitive rental marketplace.
Owners can meet this demand for flexibility by:
- Adjusting rent due dates to better align with tenants’ paydays
- Using platforms that allow tenants to pay via credit card
- Offering payment plans for security deposits
- Allowing tenants to choose between short - and long-term lease agreements
“Once a month, tenants go through this process of paying rent,” Ferrera says. “So as a landlord if you offer optionality it shows you are putting your tenants as a focus of your business and hopefully making their lives easier – which can help you create a more enjoyable renting experience.”
With rent payment technology that has adapted to these trends of convenience, efficiency and flexibility, you can save time, improve your relationships with tenants and make better decisions for your business.