Fast Decision-Makers vs. Long-Term Renters in The Renter Journey

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Several years ago, Multifamilypro, alongside multifamily management expert Ed Kelley, conducted a detailed study to uncover whether the amount of time prospective renters spend in the renter’s journey searching for an apartment impacts their length of residency. The findings confirmed something multifamily professionals have long suspected—and these insights remain just as relevant today as they were when first discovered.

Leasing teams frequently recognize a pattern in renter behavior. Prospective residents who wait until the last few weeks before moving to select an apartment often tend to vacate sooner than those who plan further in advance. To test this theory, we reviewed the rental histories of 200 residents to identify whether any connection existed.

The Study and Its Methodology

The study was conducted for accuracy across middle- to upper-middle-class communities in four cities (Atlanta, Chicago, Dallas, and Denver). We randomly selected records of residents who had rented their apartments two years prior and categorized them into three distinct groups based on their apartment search timeline:

  • The “Now” Group: Residents who moved in within 21 days of submitting their application.
  • The “Soon” Group comprises residents who moved between 21 and 60 days from their application to their move-in date.
  • The “Future” Group consists of residents who started their search or finalized their choice more than 60 days before moving.
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The Findings

The results were striking and revealed a definitive pattern across the three groups:

  • “Now” Group renters had the shortest average lease terms.
  • “Soon” Group renters stayed significantly longer.
  • “Future” Group renters, who had the longest lead time, maintained leases for the most extended period.

Why Does This Happen?

The data suggests that individuals who invest time in the journey often do so with long-term commitment in mind. These renters, who research thoroughly and take a measured approach to selecting an apartment, may exhibit similar traits of patience and reliability in other areas of life. They’re likely to be reliable neighbors and longstanding members of your community.

Meanwhile, renters in the “Now” group may have circumstances that necessitate quick decisions—such as sudden moves or changes in their personal or professional lives—resulting in shorter lease term patterns. Their quick decision-making may also reflect a lesser inclination toward long-term commitment.

What This Means for Leasing Teams

A growing trend reported by Internet Listing Services (ILS) suggests that renters are significantly shortening their apartment search timeframes. While this might tempt leasing professionals to focus primarily on these quick decision-makers, it is essential to avoid undervaluing prospects who take longer journeys to finalize their apartment search.

The study demonstrates that renters who start the journey earlier are worth their wait. These individuals often result in more extended lease agreements, bringing stability to the community and fostering long-term engagement.

Key Takeaways

Treat Every Prospect Seriously

Don’t underestimate the long-planning prospects. Even though their decision may take time, they’re often the renters who will stay for the long haul.

Analyze Your Own Data

Run a similar analysis on your leasing records to uncover trends within your own community. You may find results that reflect this study’s findings.

Balance Your Approach

While it’s important to respond quickly to “Now” prospects, nurturing and supporting “Soon” and “Future” groups can yield more significant long-term benefits for your community.

Final Thoughts and Insights

Leasing teams face increasing pressure to be agile and responsive to fast-moving renters. However, it’s key to remember that not all paths are the same, and patience often pays off. Prospective renters who invest time and effort into their search aren’t just looking for a place to live—they’re seeking a home, a community, and a long-term arrangement.

Take the time to engage these renters and appreciate their thorough decision-making. They may just become your most valuable residents, bringing stability and connection to your property for years to come.

Key Theories in Consumer Behavior

This theory posits that individual behavior is driven by behavioral intention, which is influenced by attitudes toward the behavior, subjective norms, and perceived behavioral control. In the context of renters, those who plan ahead may hold more favorable attitudes towards stability and community, leading to longer tenancies.

Source: Ajzen, I. (1991). "The Theory of Planned Behavior." Organizational Behavior and Human Decision Processes, 50(2), 179-211.

This model describes two routes of persuasion: the central route (deep processing of information) and the peripheral route (superficial processing). Renters who take more time in their search may be more engaged in the central route, indicating a commitment to finding the right community.

Source: Petty, R. E., & Cacioppo, J. T. (1986). Communication and Persuasion: Central and Peripheral Routes to Attitude Change. New York: Springer.

This theory emphasizes the role of trust and commitment in relationships, which can extend to the landlord-tenant relationship. Renters who invest time in their search may also demonstrate greater commitment, seeking long-lasting arrangements.

Source: Morgan, R. M., & Hunt, S. D. (1994). "The Commitment-Trust Theory of Relationship Marketing." Journal of Marketing, 58(3), 20-38.

The stages of the decision-making process (problem recognition, information search, evaluation of alternatives, purchase decision, post-purchase behavior) are crucial for understanding how and why renters might engage in longer search timelines.

Source: Kotler, P., & Keller, K. L. (2016). Marketing Management (15th ed.). Pearson.

This concept reflects the feeling of possession, even before an actual purchase or lease. Renters who take more time in decision-making may be creating a sense of psychological ownership towards their future home.

Source: Pierce, J. L., Kostova, T., & Dirks, K. T. (2001). "Toward a Theory of Psychological Ownership in Organizations." Academy of Management Review, 26(2), 298-310.

Relevant Journals and Databases

A leading journal that publishes scholarly research on consumer behavior. You can find articles that explore various aspects of decision-making.

Website: JCR

This journal features research that explores consumption behavior and decision-making processes.

Website: JMR

A search engine that indexes scholarly articles across various disciplines. Use keywords like "renter behavior," "decision-making," and "consumer commitment" for relevant research.

Website: Google Scholar

An academic networking site where researchers publish their studies. It can be helpful to find specific papers on consumer behavior and renting.

Website: ResearchGate

Next Steps

Utilizing these theories and sources, you can delve deeper into the relationship between decision-making processes and long-term residency among renters. This will enhance your understanding of consumer behavior in the context of multifamily housing and provide a solid foundation to support our insights into the renter’s journey.

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