If you read our 2024 Q2 Market Update, this one may sound like a rerun.
We actually had to double-check ourselves to make sure we had the right version of the data.
Unfortunately, it’s all too true.
As in our last update, we will share several charts that tell the story of the continually softening rental market.
If you want to skip the doom and gloom and focus on the next steps, we suggest scrolling to the end, where we’re sharing the best practices you can implement to take this market head-on.
Let’s dive in, check out the numbers, and see what best practices can help you stay one step ahead.
Q3 Sets the Wrong Kinds of Market Time Records
Based on market times, this is the worst May rental market since the start of our records (2017). Compared to 2023 and 2022, this May’s market times were 11% and 36% longer, respectively.
Unfortunately, this is the continuation of a trend of historically high market times, which started in June 2023.
Historically Low Lead Activity
Leads per on-market period are a good proxy for rental market activity. And for Q2, leads per on-market period told a story of inactivity. In fact, it’s the worst May we’ve ever seen.
Compared to ‘23 and ‘22, during May 2024, leads per on-market period were 8% and 18% lower, respectively.
Owners and Managers Still Playing Catch-Up
In March 2024, rent reductions were 1% lower compared to March ‘23. But that glimmer of hope was snuffed out in Q2.
Compared to May ‘22 and ‘23 rent reductions in May ‘24 were 63% and 7% higher, respectively.
On the more hopeful side, it looks like the growth rate of rent reductions is slowing.
Pet-Friendliness on the Rise
From 2023 to 2024 dogs and cats were allowed in 13% more on-market listings.
This continues a trend we saw from 2022 to 2023 when dogs were allowed in 12% more on-market listings and cats were allowed in 8% more listings.
This may indicate that property managers are attempting to work with market conditions.
Similarly, more leasing managers are marketing their listings without screening questions.
While the total change is not massive, we’re looking at a 119% jump in listings that don’t have pre-showing screening questions. This could be another sign that property managers are trying to eliminate as much friction as possible to minimize market times.
Time to Double Down on Leasing Skills and Best Practices
There’s no sugarcoating this — most property managers are swimming against the current. And the fundamentals aren’t hopeful, at least not yet. There’s still a strong cascade of household debt, stubbornly high interest rates, and increased competition from short-term rentals.
The rock you can hold on to in this rushing river of despair is your leasing skills and best practices. This means:
- Syndicating Listings and maintaining them so they 1) make it easy for prospects to self-schedule a showing and 2) show your properties in their best light.
- Optimizing Scheduling to Maximize Showings — whether you’re conducting self-showings, in-person, or a mixture of both.
- Using Targeted Messaging to nurture the leasing prospects that are most likely to convert into renters.
- Responding and Communicating Quickly with prospects on their terms, whether through text, email, or phone calls.
- Streamlining your Prospect Experience by reducing paperwork and automating follow-up to grease the chute for a smoother sales process.
- Tracking and Reporting on Listing Performance to inform strategic shifts when they’re needed.
Eventually, the tide will turn.
But until then, these are the best practices that will get you through these difficult times. And they’re the same best practices that, when this market eventually turns around, will have you perfectly positioned to maximize your rental revenue.
Ready to Find Your Mojo in this Market?
As it turns out, ShowMojo can help you with every one of the best practices listed above (coincidence? I think not).
If you’re not already a customer, sign up today or schedule a demo using the buttons below.
And if you want to hear our next data talk instead of reading it, Sign up for the Next ShowMojo Data Talk.