Tag: property management

Property managers and landlords nationwide aim to attract reliable, long-term tenants. Gaining insight into modern renters—their tenant data, financial situations, lifestyle choices, and key priorities—gives proactive property owners and managers a competitive edge in appealing to the ideal tenant. While certain elements of the rental landscape are not within the control of market professionals, knowledge is power, and understanding the preferences, spending habits, and profiles of today’s renters can inform their business approach and success. To understand today’s renter, Experian® took a deep dive into the tenant data of the rental market landscape in its 2024 report on the U.S. rental market. Among the principal findings, Generation Z and younger millennials' dominance in this sector is rising. Today’s Renter Profile Experian research reveals movements in the demographics of the average U.S. renter, now dominated by younger individuals and lower average-income consumers. These renters face challenges as they navigate the rising costs of securing housing. The 2024 rental report delves into these changes, highlighting age and income level shifts in tenant data. Critical to property managers and landlords, this information offers an understanding of their customer base and provides insight into the rental market landscape. Gen Z on the Rise: Gen Z alone accounts for 30.5% of all renters, and their numbers are increasing, up 3.5% over a year. Gen Z and younger millennials (adults under 35) represent over 50% of the rental population. Income Declines: From January 2023 to January 2024, the tenant data showed the average income of RentBureau® renters fell from $53,100 to $52,600[1]. Higher Rent Costs: In 2024, over 50% of renters paid $1,500+ per month, with the average U.S. renter's monthly payment of $1,713. Gen Z,the youngest renter population, spends an average of $1,600 monthly on rent. This context plays an important role in examining the state of the 2024 rental market. Propensity to Move In addition to age and economic well-being, landlords should take a keen interest in tenant data related to renters’ moving habits, as these provide valuable insights into behavior and market trends. Landlords generally prefer longer-term leaseholders, and renters who stay longer provide more stability to property management efforts. Not surprisingly, generational trends appear here as well. While over 90% of all renters retained one lease over a 2-year period, tenant data indicates that Gen Z and younger millennial renters tend to move more than other age groups. This tendency stems from various factors, including a willingness to relocate to more affordable regions or areas that better suit their lifestyle preferences. With today’s evolving work environment, remote work has opened new possibilities. Again, the overarching trend is that renters stay in one place for two years. In fact, this represents 92.5% of all renters. Signs of Overall Renter Financial Health Housing is a significant monthly cost of living expense, especially for many younger adults just starting out and lower-income individuals and families. The percentage of a renter’s monthly income allocated to rental costs clearly indicates housing affordability. This tenant data reflects that higher rent-to-income ratios (RTIs) signify that renters have less financial flexibility, as a larger portion of their monthly income is allocated to rent, leaving less available for essentials, savings, and discretionary spending. On average, renters spend over 44% of their monthly income on rent, and low-to-moderate-income renters dedicate over 50% to rent. General guidelines suggest that the percentage should be no more than 30%. Higher rental costs and declining annual incomes disproportionately impact those with fewer financial means. Credit and Other Signs Landlords and property managers value tenant data, such as renter applicants' stability. Indicators such as overall credit quality and negative payment history provide valuable insights into economic well-being. While negative payment history has improved slightly, the market shows a rise in delinquencies. Experian’s research highlights that while credit scores for the general U.S. population are on the rise, the trends for renters tell a slightly different story. Between May 2023 and May 2024, tenant data revealed a 2% increase in renters fell into the near-prime and subprime credit categories. Although the implications for the future remain uncertain, this data, combined with other analytics, may offer clues about market trends and opportunities. The Future The demand for rentals remains high, particularly among young adults and lower-income households. As the economy and market forces fluctuate, so do the financial pressures on renters and rental housing availability and costs. The role of young adults and lower-income households in the rental market will continue. Landlords and property managers must tune in to demographic realities in their efforts to develop risk management and success strategies. To learn more about the state of the U.S. rental market, download Experian’s 2024 rental report. [1] RentBureau income is based on modeled income, which is estimated using credit data and other predictive factors.

Ensuring the reliability of tenant applications is paramount to running a successful property management business. But with an exponential rise in prospective residents using fake financial documents to inflate income and employment status, how do property managers navigate and detect fake paystubs without stepping on a landmine of liability? The marketplace of deception Paystub generator websites As you embrace the commitment to diligence, be aware that some legitimate websites can be unknowingly used by fraudsters to create counterfeit financial documents. Knowledge is your ally here. At the touch of a button, even the minimally tech inclined can produce pay stubs that appear convincing. There are dozens of sites that offer paystub generator software, including: Design and editing software websites that are accessible to people beyond just creative professionals. Popular e-commerce platform stores that host apps capable of creating paystubs. Mobile app stores that allow users to download apps for use on all major mobile devices. Key indicators of a fake paystub Remember, as a property manager or owner, you are responsible for scrutinizing these documents to protect your business interests. Use your awareness to be vigilant, verifying every piece of information to ensure the credibility of prospective tenants. While some of these falsified paystubs may appear to be legitimate, they are usually not perfect. Here are some quick checks which may help you spot a fake or trigger a deeper review quickly. Watch out for elusive typos Erroneous spelling, particularly in company names and financial terms, is a big red flag. Keep your eyes peeled for these unruly characters. Distorted watermarks A legitimate paystub should carry official watermarks or specific symbols that indicate its authenticity. However, be on the lookout for watermarks that seem off — sometimes, they're too conspicuous or amateurish, which can be a tell-tale sign of forgery. Authentic watermarks should be subtle and consistent with the company's brand. Crunching the numbers Inaccurate calculations can unravel a fake paystub. If the numbers just don't add up or pay dates vary inexplicably, you should investigate further. Inconsistent font Professional payroll systems stick to a consistent font. If you notice various font styles and sizes, it's worth investigating further. Authenticity lies in uniformity. Going logo-less? A missing company logo, or one that looks like it was copied from a low-resolution image on the internet, should trigger suspicion. Unusual tax deductions Abnormal tax deductions could indicate someone's fiddling with the figures. Brush up on your tax knowledge or consult with an expert if something seems off-the-wall. Final food for thought Remember, having the right knowledge and tools empowers you to make informed decisions, safeguarding your property from potential fraudsters. Be diligent, stay informed, and leverage technology to support your processes. Action steps to take today Educate your team: Make sure everyone involved in the application review process knows what to look for. Develop a standard operating procedure: Update your existing (or develop) Standard Operating Procedures: As new ways of gaming the system arise, make sure your particular procedures are keeping up with the times. For example, include steps for the following: Understand tenant screening laws in your area. Create consistent resident screening criteria. Check credit report and background. Verify employment and income. Review rental history and evictions (if any). Check criminal record with multi-state search. Interview residents before signing a lease. Follow a consistent policy when accepting or rejecting applicants. Embrace technology: Income and employment verification solutions can verify income directly from a trusted data source and avoid the paystub predicament altogether. Consider implementing a verification system that leaves no room for guesswork. Our verification solution, Experian VerifyTM, provides accurate, efficient, and compliant income and employment verification services. With Experian Verify, property managers can navigate the complexities of tenant-related income and employment verification with ease, ensuring they are adhering to Fair Housing laws and detecting fraudulent behavior. To learn more about how Experian Verify can benefit your property business, please contact us and visit us online. Learn more

In recent blog posts, we’ve discussed growing in a down market and getting ahead with a proactive outreach and engagement strategy. In this article, we’ll focus on audience segmentation and multichannel marketing. As the market has shifted, effective cost management is a top priority. Lenders who get the most bang for their buck tend to use data to create their audience, segment and message. Best practice #1: audience segmentation It’s hard to beat the combination of credit and property data for mortgage lenders. Obtaining a holistic consumer view and property details (if they’re a homeowner), can help lenders determine the best mortgage product and refine their messaging. Many of our partners have great success leveraging a combination of property and credit insights to identify consumers for a home equity line of credit (HELOC) or new first mortgages. Let’s look at HELOC as an example. From a process perspective, we use property data to identify borrowers with properties that qualify for the lender’s HELOC program – sufficient equity, owner occupied, no tax liens, not listed for sale, a value below their upper lending bound, etc. Once the initial population is identified, we further segment their target population by adding key credit insights, such as current score and outstanding unsecured debt. This allows the lender to identify borrowers who qualify for their HELOC program and do specific outreach for either debt consolidation or remodel. By performing the equity and credit analytics with a single vendor, the lender can increase their speed to market.  The results? Lenders succeed by quickly reaching the right borrowers, with the right offer and message. Additionally, they don’t waste money on or disappoint applicants who don’t meet their program guidelines. Best practice #2: refining the message The next best practice I’d like to focus on is refining the message with relevant demographic and consumer behavior data. Experian studied the differences among consumers who recently purchased a home, those who recently secured a HELOC, and the general consumer population.   Look at these four categories from our Mosaic Group and consider how you would adjust your messaging if you really know your prospect? Might you incorporate different imaging for a Power Elite homeowner in your HELOC campaign than a Flourishing Family to whom you are marketing a first mortgage?   Or consider how different decision-making styles would impact the information you highlight in your outreach?  Look at the difference between HELOC borrowers and first mortgage borrowers in terms of their decision-making style. Different messaging will appeal to a consumer who is a brand loyalist versus someone who is a savvy researcher.  Best practice #3: omnichannel marketing strategy Finally, let’s focus on how best to reach the consumer. Not only is it important to meet consumers on their preferred channel, but a best practice is to execute an omnichannel strategy. We increasingly see lenders using emails in prescreen campaigns with invitations to apply, or ITAs, across multiple communication channels.  Look at the overall research for email, text, and direct mail. Increasingly, savvy marketers are asking us for emails in their prescreen campaigns, and it’s no surprise. Based on the research, a tailored email campaign can be very effective. Perhaps most surprising is the level of mortgage borrower engagement in streaming TV! This is just the tip of the iceberg in terms of how data can be sliced and diced to drive your omnichannel engagement strategy. In short, when executing a mortgage marketing campaign, it’s important to leverage available data for audience segmentation. Once your audience is identified, you’ll want to refine your message to resonate with each segment. Lastly, instituting a multichannel marketing strategy is key to ensuring you’re getting in front of your audience in the channel they’re most likely to engage. By adopting these best practices, you’ll reach the right borrower, with the right message, in the right channel, which, in-turn, will help boost the ROI of your marketing program.  To learn about Experian Mortgage solution offerings, click here. Learn more

Driving growth in a down mortgage market can be tricky. It’s a mad scramble to obtain quality mortgage leads that convert into profitable loans. At Experian Mortgage, we have a front row seat into the efficacy of different lead generation strategies, and what we know for certain, is that data matters in both the audience creation and outreach approach. I’ve compiled several best practices for identifying qualified prospects early in the homebuying journey and using analytics to focus your outreach on those most likely to convert. Best practice #1: credit-based triggers First, let’s focus on borrower-behavior triggers, as they’re key for getting ahead of the competition. I occasionally hear skepticism about tried-and-true credit-based prospect triggers, but many find them indispensable. Credit triggers alert you when borrowers apply for credit and when other indicators meet your specific lending criteria, including credit scores, score trends, credit limits, utilization and much more.  They’re effective – and not just for big lenders. Our clients leverage credit-based triggers to quickly pursue “hot leads,” and have reported higher response rates, lower acquisition costs and revenue growth. Best practice #2: property listing triggers Another borrower behavior to watch is listing a property for sale, which can be done using property listing triggers. You can use listing triggers to monitor current customers – and with Experian, you can prospect for new customers outside your portfolio. One of our clients instituted property listing triggers and immediately identified 40,000 homeowners in their footprint who had recently listed a property for sale. Experian research shows that a homeowner lists their property for sale, on average, 35 days before applying for a new mortgage. This means this lender had over a month to reach those consumers with a tailored message. Now that’s getting a jump on the competition! But what about those homeowners who list a property for sale but don’t move? We hear anecdotally about more homeowners putting their homes on the market to see what offers they can get. According to recent data, a higher percentage of listings fail to sell today than last year. While property listing remains one of the most predictive behaviors for purchase, there’s room to optimize. Whether your prospect came to you via a property or credit trigger, there’s an opportunity to improve your ROI by identifying trigger leads most likely to convert. Best practice #3: in-the-market models A key best practice in audience segmentation is to incorporate in-the-market models (ITMM). A good model is based on sophisticated analytics across hundreds of data elements and millions of loan applications. Additionally, a good model is tailored to your product. A consumer in the market to buy their first house will “look” very different than a consumer in the market for a Home Equity Line of Credit (HELOC). Experian clients are doing two impactful things with ITMM. First, they create their audience list by bundling ITMM with credit, income, and property data to identify qualified consumers likely to be in the market soon. Second, they optimize an existing marketing list. However, when it comes to a mortgage lead generation program, you can only optimize what you measure. Experian has been helping clients by analyzing their lost leads and lost loans. Several clients recently asked us to analyze their efficacy with marketing lists originating from digital mortgage lead aggregators (i.e., lists of consumers who sought information online about mortgages). I’ll focus here on the leads who did NOT originate a mortgage with our clients, but DID open a tradeline with someone else. My first observation is that prospects who opened a tradeline were significantly more likely to open a credit card than a mortgage. My second observation is when the prospect opened a mortgage loan with a different institution, 80% of the time that lender was a non-bank. This is higher than the current non-bank share of the market, which indicates non-banks are aggressive with their leads and poised to grow their share. Here’s where ITMM comes into play. By incorporating an ITMM specifically for your product – HELOC, purchase, refinance – you can focus attention on borrowers most likely to open a mortgage. In summary, instituting credit and property triggers is a critical best practice and will open the door to a plethora of prospects. If you want to level up your marketing strategy, incorporating an ITMM is key and will help you segment the trigger leads and home in on those that are most likely to convert. Be sure to check out the final blog post in this series, Lead Conversion Through Tailored Messaging and a Multichannel Mortgage Marketing Strategy. To learn about Experian Mortgage solution offerings, click here. Learn more