Do landlords really know what their tenants want? And are tenants willing to pay more to get specific features in a rental property? Millionacres surveyed 1,500 renters and 136 landlords to find out.
Some of the features landlords typically think add the most value aren’t as much of a priority for tenants as you might expect. On the other hand, certain features, some of which don’t cost much at all, could increase the income-producing potential of an investment property.
Here’s a rundown of what we found out — if you’re a landlord, you might be surprised.
- 76% of renters think that landlords know what renters want in a rental property “pretty” or “very” well.
- 86% of landlords think they know what renters want in a rental property at least pretty well.
- For the most part, landlords know what renters are willing to pay more for in a rental property.
- Renters were willing to pay more than landlords thought they would for three things: convenient payment options, guest parking, and flexible lease terms.
- Renters weren’t willing to pay as much as landlords thought they would for two things: pet-friendliness and high-quality nearby schools.
- Almost half of renters say that getting the specific features they want is more important than affordability.
- Only 18% of landlords thought that features trumped affordability in a rental property.
Do landlords understand what renters want in a rental property?
First, we asked renters how well they think landlords understand what they want in a rental property. We also asked landlords how well they thought they understand what renters want.
Here’s what they said:
More than three-fourths of renters say their landlords understand their desires at least pretty well, and about 86% of landlords say they understand their renters.
While that’s pretty good, it’s clear that landlords think they know more than they actually do about what renters want.
Where landlords got it wrong
Let’s dig into some specifics. We asked renters and landlords about 16 specific features that might increase the value of a rental property.
There were five areas where landlords might not know their renters as well as they think:
Renters want convenient payment options
This was the biggest discrepancy in the survey. Less than one-fourth of landlords think their renters would pay more to have convenient rent payment options, but more than half of renters say they would do so.
Renters want guest parking
Landlords dramatically underestimated how much renters want places for their guests to park. 48% of renters said they’d probably or definitely pay more for this. However, only 25% of landlords thought renters would pay more.
Renters want flexible lease terms
37% of landlords say that renters would probably or definitely pay more for flexible lease terms, such as easy lease termination policies or lease lengths other than the standard one-year term. However, 65% of renters say they would probably or definitely pay more — flexible lease terms could be more valuable than landlords think.
Landlords overestimate what renters will pay for pet-friendly rental properties
65% of renters said they would pay more for pet-friendliness in a rental property. But landlords overestimated how likely they were to get more money for a pet-friendly property; 82% thought renters would pay more.
Landlords overestimate what renters will pay for high-quality nearby schools
This one surprised us at first. More than 72% of landlords said that tenants would probably or definitely pay more to be near high-quality schools, but just 55% of renters feel the same way.
One possible reason is that the renter population skews in favor of people without kids, meaning families are more likely to buy than rent.
Where landlords got it right
In many areas, renters and landlords are on the same page. Here are the things we asked about where landlords and renters were largely in agreement:
- Convenient location
- Modern building
- Nice neighborhood
- Reserved parking or parking lot for residents
- On-site pool and/or gym
- Accessibility features (elevators, ramps, etc.)
- Modern appliances
- Large size (square footage of unit)
- Central air conditioning
- Utilities included
- Safety and security features
There were some minor differences, but landlords generally knew how likely renters were to pay more for each of these features.
Affordability vs. specific features
Perhaps the biggest surprise of the study is how many renters are willing to pay more to get the features they want. We asked renters how they value features compared to affordable rent, and we asked landlords how they think renters feel about the topic.
Just 18% of landlords think renters value specific features more than affordable rent, while nearly half of renters say that getting the features they want is a higher priority than paying less.
Key takeaways for landlords
If you’re a landlord, it pays to know what renters want. Specifically, renters value convenience and flexibility and also want their homes to be easy for their guests to visit.
More renters are willing to pay up to get these things than you might think, and while guest parking might come with a significant price tag, adding convenience and flexibility come with minimal added costs to the landlord, so they may be worth considering when trying to add value to your rental portfolio.
Millionacres distributed this survey via Pollfish to 1,500 American renters ages 18 and over on December 3, 2020. Data from 136 landlords was collected via SurveyMonkey between December 3 and December 9, 2020. The landlord survey was distributed via Paydirt, the Millionacres newsletter.