The Good, Bad, and Ugly about Smart Lock Boxes.

MAY 17, 2019LEAVE A COMMENT(EDIT)

The Good, Bad, and Ugly about Smart Lock Boxes. If you have been keeping up on the property management industry at all, you have probably heard about self showings. Technology has allowed property management companies to really scale into large companies without a lot of overhead. One of the most time-consuming tasks as a property manager is setting up showings and actually doing them. Insert smart lockboxes. Companies such as Rently and Tenant Turner offer property management companies like myself a package to handle all the showings with smart lockboxes. Assuming you are reading this article because you are an investor and maybe you are deciding on a property manager. I am going to breakdown a few myths and some reasons why face to face is a better and safer option. Please keep in mind that while some markets may be vastly different than the one we work in these opinions are based on the first-hand experience in our local market.

1. More people have access to look at your property. Anyone can see it at almost any time, that way you never lose out on a possible qualified tenant. Because the property manager you hired has to meet all these people face to face, they will certainly miss out on opportunities. I am honestly not sure how much of a pro this really is because the volume of tenants is not what rents a home, it’s need and fit, and in some cases the last resort when tenants face a time crunch. None of these prospective tenants, typically, are pre-screened. They are simply calling into a call center and scheduling an appointment to view the property. Do you really need 30-40 people going into this property to find the right one? A large majority of tenants know exactly what they need in a rental so if they see something that they are interested in, they will find a way to look at it. We pre-screen every person that goes into one of our properties personally. We know who we are meeting and what their credentials area before they even get to look at the property. This ensures us to find only the best tenants for the property.
2. The property will rent faster. We don’t use smart boxes and honestly, I don’t see us changing anytime in the near future unless owners would want us to. If a property is priced right and in good condition, there is no reason, in our market, that units should sit for more than 14 days. Each property depending on variables has its own set of issues but a standard well kept, well priced rental just shouldn’t sit. We don’t use lockboxes but we do group showings. This has been the most effective way, in my opinion, to create competition and find the best tenant. We will gather about 4-5 prospects and let them know that for an hour at a given time we will open the house. Typically, this is on a weekend, but sometimes I do things on a weekday depending on the demand. Walking 12 people through a rental property and explaining to all of them that we will select the highest qualified tenant based on credit and ability to pay and criminal background generally ensures only the best ones apply. If I show the property to 5 couples, typically only two of the five actually apply and that is the two with highest credit profiles.
3. Is meeting the tenants moving into a property important? Believe it or not, most large property management companies that actually use self showing smart boxes to rent homes don’t even meet the tenants until the actual move in. Everything is based on a credit report, background check, etc. The tenants see the house they like, they fill out their information on a website, and once they are approved, they generally coordinate with someone who is a move-in specialist. This is Code word for someone making 12 bucks an hour taking iPhone pictures of a home and bringing keys to the property. While credit scores are indicative of who we should rent to as property managers, this isn’t always the case for people. I have rented to many people who on paper-qualified and were terrible tenants and many who weren’t really qualified who were great tenants. Qualification in our market on a credit score is around 600. The only reason while I was able to do that was because of meeting each person face to face and having conversations with real live people. It is a lot of work to do this, but a good and true property manager can do this. We have to weed out some of the junk that comes along with tenants. In my opinion, the only way to do that is to have real conversations with people. If they are older and went through a divorce and this is why their credit is shot, then maybe we can work it out. If they are young and don’t really have any credit because they have only used cash, maybe we can work it out. The complexity that goes into finding a good renter can be exhausting, but smart boxes and not meeting the people that live in your property is downright lazy in my opinion. Many property owners manage their own property because property management companies “don’t care about the property” and this practice is one of laziness and can be a detriment to your rental. Find a property manager who vets people face to face and I can see a much higher retention rate of that property manager for you.
4. Scams, scams, and more scams.

   Jacksonville family fall victim to housing rental scam, losing hundreds of dollars

   Jacksonville family gives entire paycheck to man pretending to rent out home he didn’t own

   ‘We have nowhere to go’: St. Augustine family loses thousands to Craigslist rental scam

   These three articles have all come in the last six months. While I can’t really control what goes on with craigslist I can help your property never get scammed. In the last article, the company was using a smartbox in which the scammer signed up to see the property. The scammer also had a craigslist ad out for this property. The scammer booked the showing via the smartbox software and showed the property to the “victim” in this case. The victim liked the home and a few days later the victim came back to the scammer, who had a lease and the keys (out of the smartbox, because he booked another showing) ready to give the victim. In the victim’s mind, he met the scammer at the property and he was the owner, everything was great until a representative of the company that actually owned the home showed up. He had a fake online lease, he was out almost 5 grand and had nowhere to go. To make matters worse he was now facing eviction on his record. Without a smart box, which got out outsmarted, this never would have happened. As smart as we make technology in 2019, remember that people are still the ones creating it. People will always find loopholes and ways to manipulate the technology that was created by another human. Imagine if you hired a Property Management company and they put a smart box on your house. Then this happened to you. You are dealing with some serious vacancy and more importantly probably looking for a new Property Manager.

This short list of scenarios is only a few reasons why we at ERA Heavener Realty do not use smart boxes on rental. Maybe we are old school, maybe we are behind the times, maybe technology will replace us all one day, but for the time being, we have to protect our clients the best we can and we cannot be dealing with scammers moving tenants into one of our client’s homes. We need to get out and go talk to the actual people who will be living in these homes. We have long since forgotten that having face to face conversations while bringing out the most truth in all people. Do you think the FBI wants to do questioning via text message? Of course not, because asking questions in person will generate the most truth and the most genuine answer almost all of the time.

If you have any questions please feel free to reach out to me at [email protected]