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Let’s talk cash. The pandemic made it more difficult for many property managers and owners to predict future vacancies, market-rate rent and other factors that can help increase NOI. Even now, when we can see plenty of light at the end of the tunnel, the long-term picture isn’t clear. On the other hand, this could be an opportunity to improve your assets, save money and attract renters at the same time. Here are some ideas to get you thinking.
We’ll look at:
- Utility incentives that save you money
- Cost-effective equipment upgrades
- Maintenance investments
- Utility billing
- Automated invoice processing
- Modern websites
- Bonus: integrating everything in one solution
1. Take advantage of utility company incentives
According to NAA, properties built after 2000 tend to save owners a lot of money. That’s because newer buildings tend to have better insulation, cooling, pipes and lighting than older buildings. Properties built in the 1940s and 1950s use 50% more energy than 21st century architecture.
So, what can you do with an older building?
Energy-efficient property upgrades reduce the number of new power plants they need to build, so utility companies have good reasons for helping property managers and owners find ways to cut energy use. In fact, many owners use utility-sponsored energy efficiency companies whose sole purpose is to reduce energy consumption and reduce your energy costs.
That means you should contact them before doing work that is already covered with incentives. You never know until you ask.
If owners pay the energy bills
If you’re footing the bill for your residents’ energy use, you have every reason to find incentives for upgrades. When the person consuming the energy isn’t paying the bill, they are by nature likely to be less conservative with their use. Work with your electric or gas company to find incentives for energy-efficient upgrades. They might have written policies or even be willing to come up with a unique plan for your situation. The truth is that many property managers can lower costs and increase NOI this way.
If residents pay the energy bills
Some owners hesitate to upgrade their properties because residents pay the energy bills anyway. But even if residents pay their own energy expenses, you’ll benefit from energy updates when you market savings as special features. Even if the savings are small, for some groups, every cent counts. This includes millennials with high college debt, older individuals on fixed incomes, families living paycheck to paycheck and people who lost their jobs.
2. Replace older equipment with cost-efficient alternatives
Looking for easy, inexpensive ways to increase NOI? Here are two ideas that would benefit many property managers right away.
Get led lighting
Replace incandescent bulbs with LED lights. ENERGY STAR® rated LEDs use 75% less energy and last 25 times longer than incandescent lights.
Switch to tankless boilers
It can be difficult to find the right boiler, especially if you’re on a budget. Older boilers can be long-lasting but inefficient. New ones can be more efficient but easier to damage. Tankless options are both efficient and long-lasting, but they tend to be more expensive. However, the long-term savings are likely to pay off.
Here are some other property upgrades (that utility companies may even subsidize):
- Window film treatments
- Insulation (wall and attic)
- Smart thermostats
- Solar panels
- Heat pumps
- Duct/air sealing
- Automated/Wi-Fi sprinkler systems
Ready to dig deeper? Here are 51 ways to save water and energy at your properties.
3. Invest in maintenance: basic needs & amenities
Preventative maintenance is key to keeping residents happy. And as you know, that makes you more likely to retain residents and increase NOI overall. There are two areas to look at when performing maintenance: basic needs and amenities.
Let’s look at a few examples of basic needs that should be maintained, helping you save money while increasing the comfort of your residents.
- Below par insulation results in higher energy bills over time. A properly insulated living space is a basic need that residents will appreciate.
- Proper lighting along pathways, carports, etc. makes traveling around your property safer and easier. Some lights feature solar panels, so they pay for themselves in energy savings.
- Perform seasonal maintenance (e.g., clear gutters in the fall, winterize manufactured homes, clear brush prior to wildfire season).
- Fix leaks, repair or upgrade roofing, spray for pests and other essential tasks.
Features and amenities such as fitness centers and tennis courts should all be up-to-date, functional and enjoyable to use. Of course, if no one is using your old tennis court, it could be a waste of space. Survey your residents to see what they want. Have a lot of dog owners at your property? Convert the area into a pet playground.
Or, maybe you’re not a pet-friendly property but have lots of families. Make it a kid-friendly play area instead!
4. Get utility billing & utility processing
Yardi Breeze Premier offers two optional add-on solutions that help you monitor your property’s energy consumption, track changes over time and spend less time processing utility invoices.
Yardi Utility Billing monitors consumption, identifies leaks, notifies responsible parties, detects invoice errors and recovers overage charges. This is a great way to increase NOI and make work refreshingly simple.
Utility invoice processing
Take control of utility expenses so they don’t take control of you! Yardi Utility Invoice Processing instantly reduces costs with invoice tracking, exception auditing and lightning-fast processing. Plus, gain access to data for reporting and benchmarking. Yardi’s utility experts will even help you analyze and resolve issues as necessary.
5. Automate invoice processing
Yardi Breeze and Yardi Breeze Premier make it easy to run tenant invoices. What’s more, a built-in tenant chargeback feature lets you assess fees when the renter is responsible for a given cost (e.g., a broken window). Still, at a certain point, it can be time-consuming to manage vendor and tenant invoices along with everything else you have to do. You may have to outsource a few services to focus on higher-level tasks.
Services Yardi offers
With Yardi PayScan Full Service, Yardi can take on invoice scanning so you don’t have to. We can also bulk process rent checks and money orders with our Yardi CHECKscan Full Service offering. And if you really want to streamline every aspect of your AP processing, from automatic distributions to robust tracking and reporting, Yardi Bill Pay is the right tool for the job. By freeing up hours of your time, you’ll be able to work more efficiently on work that increases NOI.
6. Offer a resident app
A resident app is likely the answer to many, if not all, of your resident communication woes. For example, take the RentCafe Resident app. This is where renters can go to easily sign lease renewals, pay rent, submit maintenance requests, communicate with your office and more. You’re going to save a lot of time previously spent chasing down late payers, organizing maintenance fixes, responding to text and email, etc.
Here’s more good news. Before they even make it to the app, prospects will be able to find your properties on RentCafe.com, among other ILS sites. They can create a RentCafe account to apply, and their login credentials can be used once they download the RentCafe Resident app. This helps make it a seamless transition from prospect to resident.
7. Modernize your websites
A modern website may look great, but it also gets your business recognized by search engines like Google. A well-designed site increases your chance of getting seen online, increasing the number of eyes on your property. Since most apartment seekers start their search online for their next residence, it just makes sense that your business should be easy to find there.
And remember, even if you think you’re doing fine without a site (or with an older site), consider that a wave of Gen Z renters is coming. And with 55 million of them expected to become renters by 2030, this wave is looking more like a tsunami. To find young and first-time renters, who are internet-savvy by default, you’ll need a robust online presence. Attracting them to your properties first will be an important part of increasing NOI in the long term.
Here to help
If getting a website together seems to complicated, Yardi can build one for you. A well-made website demonstrates your professionalism as well, and with Breeze Premier, you can get branded websites for each property you manage. If you’d like to learn more, check out exactly how we build your marketing website.
Everything in one place
We showed you ways to increase your NOI by saving energy, installing smart tech, managing preventative maintenance, automating invoice processing and improving resident services. It would not be realistic to do all that in separate platforms. That’s why it’s so important to get property management software that acts as a single solution for marketing, leasing, screening, operations, billing and everything else you need to run your business.
Yardi has been offering trusted, one-stop-shop software for decades, and our latest cloud-based offerings have expanded our capabilities even further. Keep that in mind if you’re looking for a long-term tech partner to help increase NOI at your properties.