Technology Changes That Are Here To Stay Post COVID-19
Over the last year, both tenants and landlords have felt the pressure of the pandemic. Although the pandemic has resulted in late or partial payments and forced many landlords to sell a property, it has also demanded a series of adaptations from both sides. These practices—including virtual tours, tenant screening, and online document signing—were solid ways of doing business even during a typical year. Now, to the benefit of all involved, they are becoming the norm, even as rent prices stabilize and market demand recovers.
There was a 74% increase in virtual showings over the past year, according to Entrata. This spike was largely due to necessity—it was illegal or unwise to meet in person. Now, even though the disease is loosening its grip, scheduling an in-person showing remains a hassle, whether the prospective renter lives in your town or three states over. Your schedules may not align, so one of you might have to move other commitments around. Then, there’s the time it takes to get there and back, for both of you. And finally, the (probably, but hopefully not) paper application, which the tenant may not be able to answer as well as they could online from the comfort of their desk (and which you have to carefully file away and keep track of.)
Now, all you need is a computer or a phone with a camera in order to give a virtual tour to anybody. The easiest way is to walk the tenant through your place with a video, or else do so live on a conferencing application. But with a little savvy, you can also snap a suite of 3D photographs and allow the renter to explore the space at their leisure. Whatever method of virtual touring you choose, finding a time to talk online is quicker and easier than meeting in person, and transitions well into an online screening process too.
We can’t say enough about the benefits of tenant screening. Even in a typical year, knowing your renters’ employment situation, payment tendencies, criminal/eviction background, and credit history ensures that you choose the people most likely to take care of your property and pay on time. But COVID-19 has ratcheted up the stakes of skipping out on tenant screening. For one, vacancies take longer to fill. By our numbers, before the pandemic, 75% of landlords could fill a vacancy within a month. Now, that number is down to 50%. That means more idle time for your property. Now, imagine that the people moving in turn out to have trouble paying rent. It should come as no surprise that 34.1% of the landlords we asked reported becoming more rigorous with screening over the course of the pandemic, and we have also seen 33% more screenings per tenant. With evictions for failure to pay impossible until June 30 at the earliest, making sure your new tenants can pay rent has become all the more important.
Online screening platforms like the one Innago offers are tied in with the rental application itself. After your virtual tour, you can simply send a link to your prospective tenant, who can fill out information about past residences, evictions, employment history, income, and credit history. Then, you can bill the applicant for the checks, which include credit, eviction, and criminal checks, and provide you with a comprehensive summary afterward, so you can make an informed decision. And don’t worry—since the applicant is requesting the checks of their own accord, the checks won’t affect their credit score.
Whether this increased screening rigor includes more attention to pre-screening (like mentioning the required checks in the listing itself to scare off people who won’t pass) or else making these checks a part of the strategy for screening every tenant, these measures have proven effective. According to TransUnion, the average debt load of new tenants has decreased 10%, and the overall renter score has increased 1.7%. Even after the moratorium is lifted, eviction will remain a costly, lengthy court process. Continued attention to tenant screening practices will help avoid that course of action by ensuring that you fill your vacancies with solid renters.
Online Document Signing
Before the pandemic, many people worried that a lease signed online would be more vulnerable to challenges in court than a lease signed in person. Really, the opposite is the case, for a number of reasons. For one, hard copies of leases can be lost or forged, whereas online leases are stored in the cloud and tied to the verified accounts that you and your tenants set up through rental management software. Next, for whatever reason, tenants rarely read their lease with as much attention as we wish they would. If they store their lease in a desk that they open only during very important times, that exacerbates this problem. Having an online copy of the lease allows the tenant to access the lease whenever they want, which can help avoid confusion when it comes to policies such as late fees. Finally, online leases make renewals seamless.
But it’s not just leases that have come to be signed online. Our internal data shows a 360% increase in overall online document signings per landlord. MRI reports a similar online movement, with double the amount of online applications and an over 180% increase in online residential portal usage this April, even when compared to the pre-pandemic baseline. Our numbers indicate that 77% of tenants prefer to pay online, and it makes sense. It’s easier, it takes less time, there’s less risk of the money going to the wrong place, and less risk of a late payment.
Rental management software allows you to deliver these features easily and accessibly to your tenants. You can sign or renew online leases. Even make them month-to-month if that’s what your tenant wants. You can automate maintenance requests, sending them to the appropriate contractor according to the type of request. You can accept payments by card or ACH, as your tenants prefer. And all of these interactions are stored in the cloud, making record keeping completely stress-free.
Virtual tours, tenant screening, online rent payment, and document signing have emerged as fast, eco-friendly strategies to manage the challenges of the pandemic. Even as the rental property market recovers, the technology changes brought on by the pandemic remain easy, transparent tools for growing and managing your business going forward.
About the Author
Innago is a free, easy-to-use property management software solution, designed to save you time & money. Innago allows you to easily: collect rent, screen tenants, list properties, manage work orders, create applications, sign leases, organize financials, communicate with tenants, & much more! Learn more here