Property managers, here are the 6 top leasing trends of 2024

Despite shifting market conditions, the property management industry continues to grow at a stellar rate. According to Buildium’s 2024 Property Management Industry Report, 85% of the management companies we surveyed experienced portfolio growth within the last two years. And 92% of property managers told us they plan to expand their portfolios in the next two years.

Here are the top six trends we’ve identified for this year. From renters wanting to embrace technology throughout their property search and leasing process to property managers finding ways to increase tenant retention in light of renters’ dwindling financial health, this post will provide key insights on what you can do to keep growing.

1. Most Renters Prefer a Digital-First Process

The 2024 Industry Report found that 90% of renters want to complete at least some of the leasing process online. Renters showed this preference regardless of generation, with 96% of Generation Z, 94% of Millennials, 89% of Generation X, and 72% of the Silent Generation saying they would prefer a digital process.

As for the technologies renters want most, ease of communication and payment are at the top priorities. 70% of renters say they would like an online portal for tasks like making payments and submitting maintenance requests, while 61% say they would accept any method that enables them to make payments online. An additional 59% say that they would prefer to receive communications from property management via text message.

With that in mind, property managers can take the following steps to weave technology into their leasing efforts:

• Post listings online that include 3D images and virtual tours.
• Allow prospective tenants to apply online directly from listings.
• Set up a tenant portal.
• Enable online rent and deposit payments.
• Send communications via text message and email.
•  Allow for online document signing and distribution.

For more tech-specific stats and industry-specific insights, check our Leasing Technology Trends Report and Leasing Technology Playbook.

2. Renters Want to Find Properties Faster

Finally, renters seem to want a more streamlined property search process. In particular, they’d like their decision-making stage to be made easier by having property managers provide more detailed information about available units, alongside having multiple viewing options.

A recent Apartments.com survey found that 99% of renters wanted to see unit-specific information in listings. While you may think that this extends only to apartment descriptions and current photos, this ask goes deeper. Renters want to see fee information, as well. Beyond just seeing the current rental amount, they want to see utility information and information on any supplemental fees, such as pet fees.

It’s extremely important that your listing information is presented in both an eye-catching and fully transparent manner. Buildium’s Marketplace partners, Goodjuju and Upkeep Media, can help you build cutting-edge, SEO-driven websites that will help your listings stand out from the crowd. Meanwhile, tools such as ShowingHero can provide services like secure self-tours to cut down on the time your renters spend searching for properties.

3. Leasing Renewals Win Out over Finding a New Rental

Next, after a few years of drastic fluctuations in renter retention, we are finally starting to see more stabilization in lease renewals. When Buildium asked renters whether they planned to move from their current rental or stay put, 41% said they planned to remain at their current place of residence, a 6 percentage point increase over last year.

Among the factors that influenced their decision, their perception of the value of their current rental ranked high on the list. For many, judging that value came down to three major factors:

1. The quality of service they receive from their property manager or landlord
2. The condition of the property and quality of the response to maintenance issues
3. The amenities and services available to them

Ultimately, if the renters were satisfied with their rental in these three areas, they were more likely to stay in their current living situation. If they weren’t, they were likely to move elsewhere, despite the fact rental prices tend to be higher when signing a new lease.

For their part, property managers should consider reaching out to tenants regularly to collect feedback on these three areas and asking what they can do to improve the resident experience. Doing so may go a long way toward increasing lease renewal rates.

4. Property Managers Are Prioritizing Tenant Screening

Unfortunately, renter financial health is on the decline. Our industry report found that despite rents rising across nearly all sectors due to increasing costs, renters’ incomes have largely stayed the same. This has led many renters to struggle to pay their bills on time. While 55% of survey respondents feel that, typically, they’re able to keep up with their financial obligations, 17% say they usually struggle to stay on top of them, 6 percentage points higher than last year.

As a result, property managers have begun to put a higher priority on the tenant screening process. This added attention allows them to sign tenants who have the financial capacity to stay in place long term, even in the event of further economic downturn.

Taking steps such as setting minimum applicant requirements, requiring a complete rental application, and running a thorough background and credit check can go a long way toward helping you find tenants who will stand the test of time. Going the extra mile and getting references from an employer or landlord, as well as interviewing all prospective tenants can help you feel even more secure in your decisions.

5. Rent Collection Rates Are High, But Concerns Remain

Similar financial metrics have some property managers concerned about rent collection rates. Namely, the fact that only 22% of renters currently report being able to set aside a portion of their paycheck in savings, a decrease of four points from 2022. Additionally, a staggering 79% of renters report having some form of debt, whether it be revolving credit card balances, student loans, or medical debt.

However, rental collection rates remain high in spite of these statistics. According to RealPage Analytics, rental collection rates have hit their peak since the beginning of the pandemic, measuring at just over 96%. This figure, from February 2023, represents nearly a 1% increase year-over-year.

In addition to performing through tenant screenings, property managers should also consider other avenues to attract prospective tenants. For instance, they could bring on Buildium’s Marketplace partner, Gravy, which rewards tenants financially for engaging in behaviors that drive NOI, like making on-time payments.

6. Property Managers Are Devoting More Resources to Tenant Retention

At the same time, property managers are also having to contend with the rental market cooling down. While rising rents is one notable factor causing the slowdown, the overall supply of available apartments is also growing nationwide. According to the Joint Center for Housing Studies, an estimated 960,000 new multifamily buildings are currently under construction in the United States. With those numbers, competition for tenants is fierce.

To put themselves ahead of the curve, many property managers are taking several steps to  double down on their retention efforts, including:

• Completing renovations or property improvements: Some have even managed to create new revenue streams by managing projects and completing them with in-house staff whenever possible.
• Providing high-quality services: Offering tenant incentives—like Buildium’s Marketplace partner, Obligo, which allows you to promote deposit-free living—among other services can help reduce the chances of unit turnover.
• Limiting rent increases: According to the Department of Housing and Urban Development (HUD), the average fair market rent increase in 2024 will be a staggering 12.2%. However, property managers are finding that limiting increases as much as is feasible helps to boost retention rates.

How to Make the Most of 2024’s Leasing Trends

The bottom line on 2024’s leasing trends is that, despite some indicators that the rental market is cooling, there is still plenty that property managers can do to retain their existing tenant base and draw new leases in the door. When done in concert, both of those things can go a long way toward driving overall portfolio growth.

At base, it has a lot to do with providing quality service, keeping the property in good condition, and offering top-notch amenities. However, you can take your offerings to the next level by relying on technology to lend added convenience to the leasing process on both sides.

Whether you decide that you want to invest in a resident portal, use tenant incentives to assist with rent collection, or invest in tools such as Goodjuju to ensure that your property’s website converts, Buildium’s property management software can help you do it seamlessly with the touch of a few buttons.

Get started with your 14-day free trial of Buildium today.