The single-family rental (SFR) industry exploded in 2020 in large part due to the impact of the pandemic with more consumers seeking single-family homes suitable for spending greater amounts of time at home in suburban markets. Investors in the property type, as well as developers who are building houses expressly for the purpose of renting them, are betting big on consumers’ renewed interest in suburban housing being sustainable even after the pandemic. With greater competition in the SFR space, it is important for investors to harness the power of property data and technology to analyze properties accurately to make informed and fast acquisition decisions and increase their rental portfolio return on investment.
Utilize Resources to Collect Data to Analyze Investments
SFR investors looking to quickly scale their portfolios nationwide cannot afford to lose time and resources by physically sending or hiring a team to evaluate every property prior to acquisition. By utilizing third-party resources and leveraging technology to collect property data, investors can take a step back and focus on what they do best.
Investors should consider obtaining an electronic property condition report prepared by an experienced third-party company to better understand the state and condition of properties to remotely analyze investments, evaluate repairs, estimate the cost of materials, and track appliances and utilities through the property’s life cycle.
With a property condition report, SFR investors can learn the condition of a property, including its appliances, and scope the level of renovations and repairs to decide if it makes sense for acquisition, without ever stepping foot inside. Reference photos can be provided to assess a property’s current state, including an inspection checklist and appliance inventory complete with item serial numbers.
Leverage Technology to Acquire Properties Faster
The idea that decisions makers must physically visit a property during the acquisition stage is the old way of doing things. There are appraisal companies that now appraise properties remotely from a desktop and they can bifurcate that process, and this can also be done for due diligence by leveraging technology to help inform decisions and scopes for renovations without ever seeing the property in-person.
One of the most powerful digital tools to help streamline the due diligence and acquisition process is the 3D virtual tour. A 3D tour of both the exterior and interior of a property allows investors to immerse themselves in that property in a real-life way with a virtual walk-through of the property to understand its layout and condition. A 3D inspection tour helps SFR investors, owners and operators view the layout and condition of the property virtually and identify key issues from a holistic view. In addition, electronic floor plans that detail room measurements make envisioning a property’s layout even easier for investors.
Virtually Inspect the Renovation Progress
Once an acquisition decision has been made, SFR investors are often faced with some level of renovation to bring the asset to market. By leveraging 3D tour technology during the renovation process, investors can measure individual rooms and spaces for specific material needs. The materials can be more accurately bid out to determine the best vendor for the project, and as a result, this can also reduce the chances of change orders with contractors in the future.
3D tours can also be utilized as a quality control checkpoint during the renovation process to ensure all work has been completed. Investors can quickly immerse themselves in a freshly renovated home and can accurately determine if the asset is ready for pre-leasing and marketing efforts.
Accelerate SFR Property Leasing With 3D Tours
The same 3D tour scan that was used as part of the final renovation quality checkpoint, can also be leveraged for marketing purposes to help accelerate the leasing process. PlanOmatic recently measured the impact of 3D tours on SFR property marketing in partnership with a leading provider of SFR homes nationwide. Our test data found that property leads increased by 25 percent, and days on the market decreased by 23 percent when a 3D tour was used to market a property compared with only using professional photography.
3D tours allow a consumer to visualize a home without having to step foot in it, and the data from our test proves that SFR properties that are marketed with 3D tours online result in increased consumer leads, and fewer days on the market. Consumers are demanding 3D experiences online and prioritizing properties with 3D assets.
Kori Covrigaru is the Co-Founder and CEO of PlanOmatic, the biggest and fastest provider of Property Insights and marketing services for the single-family rental industry nationwide. With a national network of hundreds of contractors and 40 employees, Covrigaru has met the moment with the unique value proposition PlanOmatic offers through technology combined with property insights to support their clients’ goals.
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