Vacancy rates at at a 5-year high! Protect your property investments with our 4 essential strategies.

With vacancy rates at a 5 year high, and the summer leasing season drawing to a close, what can Richmond property investors expect from their residential buildings? 

According to Reis Inc, a real estate research firm, Richmond's apartment vacancy rates climbed to 8.7% in the first quarter of 2010. In comparison, this vacancy rate is a 26% higher than the first quarter of 2009, and a full 40% higher than 2008! 

How can you protect and maximize the profits to be gained from your property investments? The 4 essential strategies we outline below can help ensure your residential properties have fewer vacancies than the Richmond average. You must implement these during the next five weeks, however, to take full advantage of the remainder of this leasing season. 

1. Be incredibly accessible. You or your property manager must be available to show properties to qualified prospects even on nights and weekends. Because of the limited pool of renters, you certainly can't afford to not meet with a prospect just because they aren't available during normal business hours. You can be sure your competition won't be so inflexible, especially in this economy!  

2. Quick screening is mandatory. Make sure you have predetermined qualifications for ideal tenants. Make the extra effort to review and approve tenant applications within a day. Good prospects will be making their decisions for August move-ins in the next couple of weeks. Motivated prospects will easily find something they like with this abundance of rentals to choose from. They'll sign a lease with another landlord if you are not responsive or if your leasing approval process takes too long.

3. It may be time to reduce the rent. How can you tell? If you are getting plenty of showings but no one is submitting a rental application, guess what? It's time to make a rental adjustment. Our rule of thumb is that 20 to 30 prospects should yield a strong, qualified tenant. If your showings are over that number, sorry, but it's time to reduce the rent. Delaying any longer will not only waste your time, but will cost you months in lost revenue. In this economy, unrealistic expectations will kill your profits.

4. Do what you must to have a signed lease by August! Especially if you have a 3- or 4-bedroom property! There's a good chance you'll lose the rest of the year's rent if your unit is still vacant in September. According to Real Page, a leading rental real estate data provider, the majority of 3- and 4-bedroom properties are moved into in August. Not having a signed lease by that time, may mean you won't get another chance to rent it until next year. Can you afford the wait?

Hopefully our suggestions have given you some perspective on your residential property assets and the Richmond marketplace. There will continue to be factors in Richmond's economic picture that will result in these high vacancy rates. Thankfully, one of the variables, employment, has finally begun to trend upward, in a positive direction. 

Our next newsletter will include a discussion of recent Richmond employment data; property value trends and projections; and more recommendations for maximizing your returns on your property assets.