How I Took Tenants From the Competitors

[Tom Goans]

How I Took Tenants From the Competitors

Recently I initiated a discussion about how I was more competitive without debt. Most replies challenged and dismissed the philosophy.

This is examples of why I was successful. I am not suggesting this is the only method of success. Nor am I suggesting having as little debt as possilbe is a method that will work for you. But it is worth considering.

Upon buying a large number of residential properties, my plan was to market to 1 and 2 bedroom apartment dwellers. This business plan allowed a rent increase of more than double the rent charged by the former owner.

I had a marketing plan that understood the lifestyle and desires of the target market. I also new the most effective way to communicate to the target market.

My business plan was a great success. I offered 3 bedroom 2 bathroom residences with yards for less than the cost of a 1-bedroom apartment. A vacant property would generally be rented in less than a week.

Price was not my only competitive edge. My goals and business plans never include being another “comp”. What they do include is being the best PERCEIVED VALUE to the target market.

I could always outperform the competitors because the properties were debt free. I had the flexibility.

While the competition was trying to find ways to increase revenue to cover the ever increasing holding costs through rent increases and providing fewer services, I was taking their tenants and making deposits. Most of the competition believed in the concept of having as much debt as possible.

I later sold all the properties to a single real estate investor who had few years experience in the business. He offered and paid far too much for the properties - his numbers suggested he could.

I am not suggesting my methods and ideas are correct or the only way to be successful. Nor am I suggesting they will work for everyone. However, an idea may help you to better operate with greater success.

Think outside the box. Are you limiting your success?

Your comments and experiences are always welcomed. This is how we all learn.