How to Increase Your NOI
The ultimate goal for any property manager, or really any business for that matter, is to increase revenue and decrease spending. Simply put, we all want to get the most bang for our buck.
The way that we measure this is through NOI, or Net Operating Income. For those unfamiliar, NOI is a pretty simple equation: revenue – expenses = NOI. For property managers, your revenue will come in the form of things like rent and parking fees, while your expenses come from things like management and marketing. Obviously, the higher your NOI, the healthier your business or investment is.
Though it’s simple in concept, the reality is that many property managers out there aren’t setting intentional goals in order to maximize their NOI. Ultimately, they’re not being as efficient as they can be with their properties, and it’s greatly reducing their potential NOI in the long run.
Fortunately, the apartment marketing experts at LeasingKC have worked with property managers across the Kansas City metro to help them increase their NOI. Read on for our advice on how to get the highest value out of your properties! 🙌
Make the most of your marketing
As an owner, you should be looking at NOI as part of the bigger picture. Your property is an income-producing investment, and it’s your job to increase the value of that investment in the most efficient way possible.
Marketing plays a key role in increasing your property’s value, but like most things in life, you need balance ⚖
You need to spend money on marketing in order to get to the highest level of occupancy. The mistake, however, is spending too much. Once you get near that maximum occupancy, any additional spending on marketing is ultimately eating into your NOI.
For reference, LeasingKC recommends going into maintenance mode with your marketing once you get to about 97% occupancy. Once you go below the 93%-95% range, you should look at ramping up your marketing efforts.
Fortunately, it should be easy to know when your occupancy numbers are about to dip, as most leases have a 60-day notice.
Additionally, it’s also important to be smart with the actual marketing itself. You want to make sure that your marketing is going as far as it can for as little spending as possible. We’ve previously outlined some ways to do this, but its importance bears repeating.
In short, you want to make sure that you’re being efficient not only when it comes to how much you’re spending on marketing, but the way you’re spending on it as well.
Even if you reach the highest level of occupancy for your property, think of the toll years of inefficient spending can take on your potential NOI. Even just a few hundreds or thousands of dollars per year can make a significant dent over time.
Understanding your marketing dollars will go a long way toward making sure your NOI is as high as it can be. Fortunately, LeasingKC can help. Not only can we help you with any upcoming vacancies, our strong and optimized listing can help get the most out of your marketing budget
When in doubt, let LeasingKC help you maximize efficiency and increase NOI
For those in the Kansas City area, LeasingKC can help you with any questions you may have about increasing your NOI. As a local listing site, our experts have inside knowledge on what it takes to make sure you’re getting the most bang for your buck. With a variety of cost-effective marketing plans, we can equip you with the best tools and resources to reach 100% occupancy (or at least close to it).
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