Closing Ratio @#*!??

At a recent networking event I attended a woman from another company asked me what was my closing ratio. My reply? I DON'T KNOW! :unsure: I'm a Leasing Consultant and it's something I've never heard brought up in the 2 years I've been with my company. I don't even want to ask my manager. What is it and how do I find out what mine is?

Wow - I haven't heard of that before, Danielle! Usually the closing ratio is the top thing on the list for evaluating leasing consultants. There will be a report in your property management software, if you can pull it.

(As a side note, if you sign up at the top right of the page, your discussion posts won't be moderated - they will immediately show up!)

I actually had an account before but asked to have it removed because I was considering another career path. However, I have decided to stick it out just not with my company. I have very little positive things to say about my current company and didn't want anyone finding out. This is my first property management position but even as an outsider I could tell that some things were terribly wrong. I'm sure companies are aware of the reputations of other companies and I fear that when they see my companies name on my resume I get over looked! I feel so stuck and that's my every day or two I'm posting a question on here

I'm sorry to hear that! But you are always welcome here - just keep posting questions, and we'll be your support group!

Hi Danielle,

It isn't hard to figure out your closing ratio. It just means how many leases did you get from all of the tours you had during a specific period of time. I have seen several leasing consultants lately who had no idea what their closing ratios were, so you are not alone. Some property management companies do not set up their software reports to allow access to all site personnel, so you may not be able to run a report. Here is an easy example: you had 10 tours this week and two leases. Your closing ratio would be 20%. That means 1 person out of every 5 people who toured with you filled out an application/paid a deposit (for some companies, they have to pay the deposit. For me they just have to apply.) The kicker could be any of those who agreed to lease who may eventually cancel. Some companies deduct this from your totals. Your goal of course is to get everyone who tours with you to fill out an application, pay the deposit, get approved AND move in.

Hope that helps!

Danielle,

Also keep in mind that one particular number does not indicate your "worth." A closing ratio should show how many sales "closed" based on the number of prospects...in a normal situation. One time as a leasing agent I showed a model for a building to be constructed in 9 months. My closing ratio was zero! In another situation of a friend of mine, the rents were overpriced for a run-down property. Not much you can do to have a high closing ratio on that.

Typically people inflate it too! Another manager once told me she'd always had a closing ratio of 80 percent her multi-year entire leasing career. No human alive has ever done that. I would say my average was 25 percent overall in my leasing career. It's easier to figure in a single job while you have software to assist.

One reason a company might not measure it is not because they're stupid, though, but because they give leasing agents such a customer service emphasis and good training that they want to focus on relationship selling, not hitting a number.

There are a lot of factors that can also affect closing ratios as well and unless I missed it no one has mentioned you can have the best leasing person in the world, but the product may be a hard sell. So, I like to not always to place the monkey on the leasing person's back. I like to look at other things which may have an impact. What are the first impressions when walking onto the property? How are other staff members acting when a perspective customer is on property?

First impressions are everything and if you have had personnel working at a property for a long time, they may develop what I call dead eyes. There are cosmetic problems which they no longer see and outside eyes are often good. Customer’s first impressions are everything and can be indicators of what they are moving into.

So, when I am hit with the closing ratio of a leasing person, I look at all other outside things that may have an impact first and if all is well, and then they have 100% of my attention and focus.

If the theme is what is the closing ratio and how do I get it raised, and then let’s look at the product first is my approach. I think it is important that leasing personnel should know their closing ratio as it gives them a yard stick to measure by and to look if it is them or the product, or maybe a combination of both!

My owner doesn't pay much attention to my closing ratio, because I rent off of a long waiting list. Our rental market here is so strong that all of my new move ins have been waiting over a year.

Really? Where are you? Sounds like utopia! Lol

It's utopia if you like lot's of rain.

Oh, BTW, the ground is frozen, so when it rains again the streets will be a shiny, pretty, sheet of ice.

Rose, I have to point out that if you have a waiting list, then it came to be because of - what? You don't run a section 8 property so the wait list has to be the result of someone's ability to relate to those who visit your property and like what they see and how they are treated, enough so that they are willing to be added to a list where they may not get called for a year. And I bet that your owners pay no attention to your closing ratio because they don't need to.

I can also tell you that most companies pay very close attention to closing ratios when there is an occupancy problem. Obviously, most companies look at staffing and closing ratios before most will consider the problem with the product or the price. From a personal level, I want to know that when someone walks through the door, I can personally get a lease! Maybe that is my internal competitive spirit, but I have had closing ratios pretty high up there. If my closing ratio were consistently only 25% I would get myself more training!

Closing ratios are an important measure of the property's success, in my opinion, not just the Leasing Consultant's success. For a leasing professional who receives 4 Prospects in a day, and all are qualified and able to pay the rent quoted, I would be horrified to only close on one person. That being said, for the three who left without leasing, you bet I want to figure out why! Is it the product? The price (after all)? The place (location of the community, location of apartment available)? People - me? Did they not like me???? (Impossible, of course. :0)

Now anyone can have an off day! Just like anyone can perform poorly on a shop report. It's that level of consistency that concerns me and it is important to evaluate reasons people do not lease at your property. It is also important to understand if one leasing consultant closes every other person; one closes only occasionally and another just one out of every four - training can help improve overall performance and thus improve the property's performance as well.

My residents think our building is full because of the awesome manager. I typically try not to brag, but the owner keeps me around so I'm sure good management is part of the equation.

So here's the real reasons:
#1 is probably location. We are in a nicer suburb where most residences are owned, not rented. My community sits in the parking lot of the largest shopping mall in the area, and is on six bus lines, which is also very rare for the suburbs. Due to our horrible parking availability, I market heavily to users of public transit.

I do not seek to get a lease from everyone who walks in my door. I do not try to get everyone who inquires to come for a tour. I know this goes against the grain of most in our industry. Sometimes this means I'm my own worst enemy, but it's also job security.

I make it clear to my residents that it is my duty and obligation to make money for the owner of our building, but that I will also do everything within my power to maintain a quality living environment for them.

When you share a house with 130+ other people, you know their "dirt;" whether its financial worries, family matters, romances, etc. I make sure my residents know they do not have to be embarrassed about their dirt. Not to me, because I will never judge them for it. No matter how long they live here, and no matter how long it is since they moved out.

I seek to help everyone who inquires find the right housing for them. Even if it not beneficial to me. I refer business to my comps when someone comes who will not be a happy long term resident at my community. I don't take large dogs. I have 22 stairwells and no ground level units. I have no carports or garages. And I maintain a spreadsheet of over 200 of my closest comps so I can confidently recommend a place to suit anyone's needs. Of course I don't have to do this. But what happens to those people who I refer to my comps? They refer their friends to me.

Today my mail carrier asked me if I remembered a resident named Sarah. Of course I do. And I remember her last name, where she works, her sisters name, her moms name, and I know the color of her eyes. The mail carrier is new and didn't know her from when she lived at my community. He is a friend of hers. It's this word from a friend of a friend that people remember. Unfortunately for Sarah, my community was the first place she lived on her own, and she was in for quite a culture shock when she finished college and moved away to start her career. Her apartment manager will not work around her schedule to get the lease signed. They will not sign for a package so she can collect it as her convenience. They will not make sure the mail carrier gets mail to the right mailbox when the sender forgets the apartment number.

I'll leave all the percentages and numbers games to the higher ups.

Mindy,

It occurs to me that there's another factor with closing ratio, based on your response. In Chicago, where I'm at, 25% would be just fine in a downtown A building. Imagine so many comps that you could walk from one to another and tour 8 of them in 6 hours--and they all have the same basic amenities and are near each other.

When I was in Denver, it was a different story. It seemed like the closing ratio was higher. Also, I'm sure garden/suburban is different than a large downtown.

Another factor: you mentioned closing a certain percentage of qualified lookers. That is the "right" way, but I have heard of companies who calculated two closing ratios: that style, and then one for "all" whether they were qualified for not. Obviously that's not likely to be a number one wants to tout!

Want more on closing ratios? Check out this thread. www.multifamilyinsiders.com/apartment-id...g/5484-closing-ratio

I looked up my closing ratio. For inquiries vs. move ins, it's a measly 5%. If my software had a way to compute closing ratio only when I had a unit available, it would be better I'm sure.

Mark,

I read the other thread and noticed a link to your blog titled "I no longer give a $#!+ about your closing ratio."

However, the link there only goes to your blog stream, and there are many many many blogs there (you're quite prolific!). I used search terms but they didn't work.

Can you provide a link to that specific blog? I'd love to read it.

Hey Chuck - try this link: www.multifamilyinsiders.com/multifamily-...r-closing-ratio.html

Thanks Brent. You need to read the comments on it as well Chuck.