Occupancy rate is quite simply the most crucial metric for student accommodation companies as it measures the proportion of available units that are currently rented. A high occupancy rate indicates a high level of demand for a property – an ideal position that managers and owners constantly desire. Additionally, occupancy rates directly affect the property’s financial performance and help businesses understand the needs and preferences of students to optimize the services.
The importance of high occupancy rates in the Purpose-Built Student Accommodation (PBSA) industry has become even more pronounced in the post-COVID-19 era. With the sensitive geopolitical environment and the threat of a global recession looming large, a high occupancy rate can not only ensure a steady income stream but also be seen as more attractive to potential investors or renters.
There are several strategies that property managers and owners can follow to consistently ensure high occupancy rates for their properties. Let us explore a few of them.
Location is one of the most important factors in determining the occupancy rate of a property. Properties located in prime locations, or that are in close proximity to universities and colleges, are more likely to have high occupancy rates than those located in less desirable areas. Additionally, the location itself can play a critical role in the safety and security of students, which can further contribute to the overall appeal of the property to potential renters.
Furthermore, a property located in a desirable area can also be more attractive to potential renters, who may be willing to pay a premium for the convenience and lifestyle associated with the area.
One of the biggest changes brought about by the pandemic in the PBSA industry has been around the shift in expectations that renters have from properties. Properties that offer modern amenities are more likely to have a higher overall appeal as opposed to ones that don’t.
Investing in amenities like fitness centers, recreation centers, study lounges, and on-site laundry is an effective way to attract student renters that can have an immediate impact on occupancy rates. In addition, technology-enabled amenities such as high-speed internet, smart home features, and keyless entry can also make student living more comfortable, convenient, and secure.
PBSA owners often invest heavily in their properties while completely undermining the importance of marketing their assets. By effectively promoting your properties to potential renters and leveraging the power of different marketing channels, you can increase visibility and attract more potential renters.
Creating a strong and professional website, providing detailed property information and creating virtual tours should be a no-brainer for all owners & managers. Since most students look for housing online, utilizing social media platforms can greatly increase visibility.
Furthermore, it is essential to stay on top of your marketing efforts 24/7 by tracking & analyzing performance, identifying the most effective channels and adjust your strategy accordingly.
Be responsive to tenants’ needs and concerns, and be willing to work with them to find solutions. This kind of consideration will be appreciated by students and can help to build loyalty to your properties. For example, you can create a tenant feedback form on your website and respond promptly to complaints or suggestions. Additionally, you can also be flexible with lease terms, such as allowing tenants to sublet or renew their lease early to accommodate their changing needs.
Offering flexible lease options, such as short-term leases or month-to-month rentals, can significantly impact any property’s occupancy rate. One of the main benefits of flexible leasing is that it can appeal to a wider range of renters, including students who are only in need of housing for a single semester or who are unsure of their plans for the next academic year. Additionally, flexible leasing can help property managers to fill vacancies more quickly, reducing turnover and increasing the overall occupancy rate of the property.
Research the prices of similar properties in the area and ensure your prices align with the market. Consider offering discounts or incentives for tenants who sign long-term leases or refer friends. For example, you can offer a 10% discount for tenants who sign a 12-month lease, or give a $200 referral bonus for every friend a tenant refers who signs a lease. Additionally, you can offer all-inclusive packages, where the rent includes utilities, internet, and other amenities.
Maintenance is yet another vital aspect that determines rates in student accommodation. Properties that are well-maintained are more likely to attract tenants and have lower turnover rates than properties that are in poor condition. By ensuring that the property is kept in good repair and that any issues are addressed promptly, property managers can help to create a positive impression with potential renters and maintain high occupancy rates. Regular maintenance tasks, such as cleaning common areas, fixing leaks, repairing appliances, and maintaining the landscaping, are essential to keep the property in good condition and attract tenants.
Properties that demonstrate a commitment to safety, health, and student well-being can be more attractive to potential renters.
Measures such as security cameras, keyless entry systems, and secure storage areas can create a safe and secure living environment. On the other hand, health considerations have become particularly important in the post-COVID era, with tenants being more cautious about their surroundings. Proper sanitation and regular cleaning & disinfection of properties can also boost occupancy rates. Furthermore, promoting a sense of community and providing support services that help students with their academic, social and emotional needs contributes to attracting more renters.
By keeping open lines of communication with renters, responding quickly to questions and concerns, and being transparent about any changes or disruptions that may impact their living experience, property managers can create a positive relationship with tenants and increase satisfaction & loyalty.
Regular communication with renters can also help identify and resolve issues before they become major problems, which in turn, reduces turnover and increases occupancy rates. In fact, building a two-way communication channel and taking regular feedback allows PBSA providers identify improvement areas and tailor their services and amenities accordingly.
By now, we know that properties that can maintain a high occupancy rate may be considered a more stable and reliable investment in difficult economic times and are more likely to generate a steady income stream. However, the complex and demanding nature of many day-to-day functions like finance, HR & IT can drain in-house teams, taking the focus away from core strategies that contribute to occupancy rates.
RELATED CASE STUDY: A rapidly growing PBSA giant was looking to consolidate operations and standardize its accounting processes. Read the case study to know how QX helped the client leverage automation to optimize processes and deliver 50% cost savings.
QX Global Group is a global Business Process Management (BPM), Technology and Consulting company specializing in setting up Shared Services and GBS centers for student accommodation companies. Leveraging our end-to-end business solutions, PBSA providers are able to set up highly efficient offshore teams for critical back-office functions like accounting, IT & HR. Our solutions are highly scalable in nature and can be tailored to meet your specific organizational needs. Get in touch to enable back-office transformation for your business today!
Originally published Jan 24, 2023 11:01:29, updated Jan 24 2023