A Guide to Innovative Multifamily Management

01 What Is Multifamily Housing—A Look At The Numbers

Multifamily housing refers to almost any type of building that houses more than one family at a single time. It could be anything from a duplex to a condominium to an apartment complex.

Currently, 37% of American renters live in multifamily housing apartments. This represents more than 44.1 million households.

Due to fundamental market changes—namely, the rising costs of house prices across the country, restrictions on supply, and the dwindling supply of low-cost home rentals—people across all walks of life have embraced multifamily housing. Broken down by socioeconomic status, apartment households look as follows:

26%

make less than $20,000 annually

18%

make between $20,000 – $34,999 annually

14%

14% make between $35,000 – $49,999 annually

17 %

make between $50,000 – $74,999 annually

25%

make $75,000 or more annually

Renting a unit in a multifamily housing complex has also become increasingly common across age groups and family types.

According to the Joint Center for Housing Studies of Harvard University:

Between the onset of the homeownership boom in 1994 and the first three quarters of 2019, rentership rates were up 4.5 percentage points among households aged 35–44 and 5.3 percentage points among households aged 45–54. Even among households aged 55–64, the renter share increased 4.2 percentage points over this period.

Experts predict that to keep up with demand, the country will need an additional 4,600,000 units by 2030, with almost 11,7000,000 units requiring renovations. This puts significant pressure on both the apartment housing industry and the people tasked with managing the complexes.

02 Multifamily Management: A Necessary Service

Whether a multifamily unit accommodates four households or hundreds of families, there are countless tasks that must be overseen to ensure that the property is in order and conditions are livable—from power, to internet, to maintenance, to sanitation. Not only that, from a business standpoint, it’s essential that every available space is occupied since each vacancy represents lost revenue.

Because of these factors, multifamily management is an essential aspect of running and maintaining a successful rental investment.

A multifamily property manager has to wear several hats.

They have to play the role of supervisor, salesman, client representative, and accountant, all in one. Any of those jobs can be a challenge in and of themselves, but combined, the difficulty increases. And since they are effectively a middleman, multifamily managers must serve the needs of both tenants and the property owner, which can be a tricky balance.

Responsibilities of a Property Manager at Multifamily Rental

Just consider some of the major tasks a property manager has to perform daily, including:

Collecting rent - Property managers have to ensure that landlords are being paid in full and on time. If not, they must then manage the relationship with the tenant while enforcing the rental agreement.

Maintenance - Inevitably, structures and appliances break down. Property managers must arrange for maintenance and repair, and do so on time to satisfy both legal requirements and keep renters happy. Also, when tenants move out, damages must be assessed and repairs made before new renters can move in.

Marketing - For any property, there’s a steady tide of tenants moving in and out. Vacancies occur all year round, and management must ensure that they fill the unit with qualified renters with as little wasted time as possible.

Showing the property - Along those lines, property managers need to show off vacant units and the property itself in order to win over new tenants. Giving physical and virtual tours may be a daily task. From there, they must also interview and screen potential new residents.

Legal issues - Properties must operate within the boundaries of local, state, and federal rental laws. Should a legal concern occur, it needs to be handled in a way that satisfies the law and upholds the interests of both parties.

Bookkeeping - Property managers need to maintain a ledger and records for every unit and the inhabitants dwelling therein.

Costs of Multifamily Real Estate Management

The tasks listed above have their constraints and costs—be they time, labor, or expertise.

For example, vacancies eat into revenue. Additionally, maintenance may require an entire team of outsourced contractors, a full-time staff member, or a mix of both, depending on demand. Not to mention there are also the costs of supplies. Then, there are property taxes to consider. And you also have to factor in elements that further impact the cost of property management, such as:

Size of rental property

The location of the property

The type of property

The condition of the property

The services rendered

Put simply, there’s a lot to consider. And the bigger and more complex the task, the more you have to think about. This is why increasingly more property owners and investors are turning to a multifamily management company like the team at Common.

03 What Services Are Offered By Multifamily Management?

Multifamily management frees the property owner from the burden of either managing a multifamily housing unit or from hiring a property manager to handle the job.

By working with the right group, you can maximize returns on the property investment—both in the immediate term and over the long haul. Additionally, they can provide a wealth of experience and technologies that help drive further value. That could be anything from identifying areas to make improvements to increase the rent prices, or optimally servicing the needs of existing tenants.

There are dozens of tasks and challenges a multifamily management team can handle, including:

Property management - Oversight of both the day-to-day operations as well as the long-term investment strategy plans.

Property maintenance - While this could be considered a subset of management, staying atop property issues is a massive task. Done poorly, it could be the factor that causes vacancies. To prevent this, property management teams must perform regular inspections and preventive maintenance.

Property acquisition - Before a multifamily property is added to an investment portfolio, it must be carefully vetted via rigorous market analysis to ensure ROI.

Finding strategic opportunities for upgrades - One of the best ways to drive investment value is by identifying areas within a property to upgrade in order to increase the overall value of the property and each unit.

Legal - Every area has different rules and regulations. Property management teams ensure that you’re abiding by local ordinances and building codes.

Benefits of Multifamily Management

Investing in a property could be a potentially lucrative opportunity. But, as noted above, it comes with a lot of burdens and responsibilities. By working with a multifamily management company, you enjoy the benefits of all the services above, as well as:

Avoiding the hassle and headaches involved with property management

Increasing return on investment by letting professionals handle the job

Saving money on maintenance and repairs due to long-standing industry relationships

Preventing costly legal issues

Decreasing tenant turnover and vacancies

04 Common: Multifamily Properties & Management Reimagined

As a residential brand and operator that designs, leases, and manages multifamily properties, Common is changing how property management is done. It’s ushering in a new age of renting—one that’s tailored to the modern world and today’s renter.

What are our focuses?

Common provides unparalleled in-house operations and technologies to an array of renters and property owners. We offer four primary value-driving services, including:

Property management - By integrating expert professional service providers with cutting-edge consumer technologies, you can reduce operating expenses, optimize data collection (for smarter long-term management), and drive value.

Marketing & leasing - Common uses a variety of lead generation methods to ensure that every room is filled with a satisfied tenant. More than 24,000 leads come in each month via several marketing channels, including paid ads, social media, and traditional listings.

New housing products - The old ways of multifamily living are just that—dated. There are now bold new opportunities that reimagine what a multifamily complex looks like. We use smart design to maximize the value of rent per square foot, using new typologies like coliving and microunits, and commercial to residential conversions. ROI.

Design advisory - Do you have a property that needs to be designed and built? Looking to renovate an existing complex? We provide both traditional and non-traditional apartment design services to ensure that units look great, are built to last, and are made for comfortable living.

Are you ready to see what the future of multifamily management looks like? Learn more about working with Common and contact us today!

National Multifamily Housing Council. Household Incomes.
https://www.nmhc.org/research-insight/quick-facts-figures/quick-facts-resident-demographics/household-incomes/
Joint Center for Housing Studies of Harvard University. America’s Rental Housing 2020. https://www.jchs.harvard.edu/sites/default/files/Harvard_JCHS_Americas_Rental_Housing_2020.pdf
National Apartment Association. United States Needs 4.6 Million New Apartments By 2030 or It Will Face A Serious Shortage. https://www.naahq.org/news-publications/units/june-2017/article/united-states-needs-46-million-new-apartments-2030