What is a good response to; “I am paying X amount and my neighbor who just moved in is paying less”?

Looking for advice.
What is a good response to;
“I am paying X amount and my neighbor who just moved in is paying less so why is my renewal going up when my neighbor in the same type of unit is paying less than me??”

While I cannot discuss a resident with another resident. I can tell you that market conditions set the rates.. much like gas will be one price one day and another price on another day, the same is true for rental rates.

Actually, its a great question. Its ridiculous that people are paying such vastly different amounts for the same apartments. Corporations have zero interest in retaining residents because they bank on new move ins. The new guys rent is SO much less because the corporations use the hike in renewing residents rent to justify the price breaks for the new guy. People are allowed to be upset, that's a normal reaction to finding out you're paying more for the same product. The rental market needs some limitations and rent stabilization. As the rents increase, so does the homeless population, the two go hand in hand.

I agree soooo much! We have absolutely no caps on renewal rates so I get it to! I just don’t know how to effectively word this

Market rates change, specials, supply and demand, pricing softwares... you must likely didn't lease the same floorplan/ renovation style, on the same floor level, at the same time. It's like going shopping and getting something that was marked down or on sale or "while supplies last" I can't necessarily go in and get that same deal a month later. OR maybe I go a month later and get it even cheaper... it's about the market value.

I have been in the business 32 years from leasing all the way up to Regional and what we were told to say is if you go to the mall and you see something that you like a sweater or a chair or anything and you don't purchase it that day and it was technically on sale or some type of reduce rate but you still didn't buy it and then you go back two or three days later and the sale is off well you're pretty much out of luck you should have bought it when I was on sale it has to be an urgency thing

It cost money to move so they receive a small break to cover security deposits, utility deposits, movers, etc. When they renew next year, the rates will be similar.

that only works when the same deal was offered to the existing resident when they moved in. Why should an existing resident pay more? They are actually saving you money by staying. You don't have the advertising cost, the cost of turning a unit, the extra paperwork, etc. Try retaining the existing residents instead of rotating them like they were just a stock product'

While I cannot discuss any particular resident's file with you, there are a few reasons as to why a homes are priced differently: different layouts, sizes, renovations and lease length. What I can tell you is that everyone's rent is going up this year due to the recent increase in city taxes and vendor pricing.

They moved in on a special
You're getting closer to market rate and when you do no more increases so you're ahead
While they are behind
Resident "oh okay"

Then when they renew I give them some concession which is very minimal like $50 off the second months rent of the new lease or I give them a GC at a grocery store.
Works too

My rent went up over $300 in 2 years so I gave my notice to move. Decided to find out what they were advertising my exact apartment for and found out I was actually paying over $500 more a month than going rates. Told them I would be willing to stay (at $200 more a month than what they were advertising) and was told if I wanted a cheaper rate I would have to move out for a week to 10 days and re-apply. I promised myself I wouldn’t be that guy. Try explaining that to your owners.....
Sometimes it’s about making the best business decision.

I've use the grocery store for an example A gallon of milk cost $4.99 you buy it. Then a couple of days later a sale on that milk is $1.99 your neighbor buys the milk at that price. Which is why most residence pay different amounts of money because every day the rent can change.

With pricing software that can put a rate of say $1200 for a unit one week and then $1400 the next which is more than a 15% increase in a weeks time. This condition is unnatural in long term real estate trends so it can make some odd circumstances in trying to arrive at renewal rates.
These programs were developed off of the hotel industry which operates on a nightly demand structure rather than a long term rental term.
It can create some deep variances that are way out of market values at renewal time if the rate was based strictly on the availability of a particular unit in a small snapshot of time not really based on the natural increase in overall housing markets.

Well if the neighbor moved in before this person, I’m sure the rent was lower back then, right?

some people may have come in when we had a promotion or Yeildstar was on crack so they just got the rate offered in the system etc.

Our pricing is generally based on supply and demand. Floor plan or perhaps 1st/2nd floor - We had a lot of that floor plan thus we reduced the _____ so that we could gain occupancy. We do that sometimes....

"We are unable to discuss the details of anyone else's lease with you, would you want us giving others information about yours?"

agree completely, I work at a property where alllll of my tenants y’all to each other so they know everyone’s business already. Just looking to combat the argument of why did they get this and I didn’t?!!! So hard when they share all their business with each other

Lori Breedlove wrote: Actually, its a great question. Its ridiculous that people are paying such vastly different amounts for the same apartments. Corporations have zero interest in retaining residents because they bank on new move ins. The new guys rent is SO much less because the corporations use the hike in renewing residents rent to justify the price breaks for the new guy. People are allowed to be upset, that's a normal reaction to finding out you're paying more for the same product. The rental market needs some limitations and rent stabilization. As the rents increase, so does the homeless population, the two go hand in hand.

What sort of non-capitalist sentiment is this, just overcome the objection. Prices are different because the market is different on any given week and screening requirements might have changed.

FYI, if rent stabilization makes it to my market, I can remove just about 90% of all leasing agents, just manage everything from my cell phone or laptop and have people follow my robot in the buildings. Be surprised how easy it can be as long as power and communications are working. People are already doing this in my market for home sales.

Lots of people have given you helpful tips and strategies...i would add to be sure to be empathetic. And not it in the fake empathy of, "I'm sorry you feel that way." The big picture is when someone comes in with this question they feel "less than" or that somehow they are not as important or valued as the person with lower rent, especially if that person moved in later.So...before you get into the logic of why rents are different, begin with true empathy and then simply explain why rents do change... that's my 2 cents.

Love this - thank you for sharing

In a previous life (I am version like Steve 5.0 at this point), I was our company's revenue manager, having brought the concept to life and begging to take it over since I was already marketing and training. I made some tools for our managers to use - one was a grid that showed (without names) what every apartment was currently leased for (sort by floorplan type and move-in dates) - just to demonstrate the cycles of supply and demand. Obviously you can run this on your own just by dumping a rent roll to Excel and doing a simple data sort. But it's real-time, real-life tool that allows you to have an honest discussion....demonstrate the ranges and the supply/demand cycles in your market, e.g. rents are not always highest in summer, school does not always dictate traffic, etc.

..if that doesn't work, you point out that, down the road if the person decides to buy, the next door neighbor may have paid $50k less for basically same house.

Real estate is a business transaction.....not always "fair," whatever fair might mean to the person sitting there.

Transparency tends to be right.