Vacancy rate near 4th and Candelaria

[John Strong]

14 unit complex in Albuquerque near 4th and Candelaria For the past two years we have had only one full month of occupancy. Anywhere from 1 to 4 vacant  consistently. Management company says the pool of renters in the area is very poor. PM would like to lower our rent from 575 2bdr to 550. Not sure that is the answer. Asking if that area of Albuquerque is a problem or is my rent "TO D@#* HIGH"? 

[Guy Gemmer]

Oooh! I love multi-family apartment questions. :) Except that my answer on this one will be pretty universal since the principles apply across the board. As a matter of establishing rapport I will give you a little background on my ownership and management experience. I own 37 MF Apts and 6 SF. I manage 100 MF and 300 SF. - Licensed since 2004 and managing property for others since 2008 -
Everyone has an opinion but the proof is in the pudding. If you have a desirable property in a desirable area, you won't have high vacancies. There are 3 working pieces in all types of real estate and they work inversely.
PRICE | CONDITION | LOCATION
Your price must reflect the condition and location in order to compete with any active competition.
Examples:
Great Location + Poor Condition = Moderate Price
Poor Location + Great Condition = Moderate Price
Great Condition + Great Location = Great Price

If you already own the property, the location is fixed. (You can't control it) If you figure out a way to move it... Let me know. ;)
The price is based on what the market place yields. It's all about what someone else is willing to pay. (You can't control it)
The condition is the only thing you can control.

There's no secret to supply and demand when it applies to multifamily vacancy rates. Your property manager should be familiar with the competition and give you a quick break down of how your property compares. Have you been doing preventative maintenance and maintaining curb appeal or have you been so focused on cashflow that you've forsaken first impressions and have unintentionally moved your property from a b+ to a c- ? Your property manager was hired to manage the rental portion of your property, not your asset. That's like sending your kids to school and expecting the teacher to instill good morals and values. That's not in their job description. In both cases, the really good ones try but ultimately they're your babies.

Everyone has an opinion, mine are free! Feel free to ask for it any time :)