Real Estate Marketing and Your Rental Property Investment
Having a comprehensive real estate marketing plan will help your rental property investment business grow and stay organized. Your rental property's marketing strategy outlines how you will communicate with potential tenants on every level.
Knowing your market's preferences allows you to increase your revenues and rent out the property relatively quickly. Read on to learn how to reach potential renters using offline and digital marketing efforts.
Recommended: Be sure to read our guide to Real Estate Investing.
Why Create a Marketing Plan?
Your strategy is important because it will save you plenty of money and time in the future.
Example: Assume that potential renters in your area use social media on a daily basis. When you conduct your audience research and discover this, you can focus on social media marketing and run advertisements that maximize profits. Spending money on billboards or newspaper marketing, on the other hand, might be less profitable. Similarly, learning how to create billboard or newspaper advertisements is a time-consuming process that may not generate as much revenue. Focusing on mastering one form of advertising, such as social media, is much more effective.
There are many other benefits to curating a solid marketing strategy. To learn more about them and get started, follow these steps:
1. Determine Your Marketing Budget
First of all, how much money do you plan on spending on marketing? When you create a budget, you can choose the rental listing platforms and types of advertisements that suit your financial needs.
Just as importantly, if your budget permits, you can save plenty of time by hiring a professional to design your website and marketing graphics.
Similarly, if you plan on allocating your costs towards a specific medium (such as digital marketing or printing brochures), there are many free and easy-to-use templates that allow you to customize your website and designs.
In short, your marketing budget points you towards where you should invest your money and/or time.
How to Create a Marketing Budget
The following steps will help you create an effective and cost-efficient real estate marketing strategy:
- Look at the current profit that you expect to make from your buy and hold investment. You can do so by subtracting your loan payments, the interest rate, insurance, and maintenance costs from your rental revenue.
- Next, identify your ideal/desired net income from your real estate investment. From there, determine how your marketing budget's size will impact your profit margins.
- Decide on how you will fund your marketing efforts. If you are getting a loan, for instance, will any of that money go towards advertising? Make sure that the lender's policies allow that. In the same vein, check how much others are willing to invest if you are working with business partners.
- Study the different marketing costs that are involved. For example, how many listings do you plan to post on platforms like Apartments.com and Craigslist? Account for the cost of creating a post on each website and the number of listings you want to publish for your rental property.
- Consider taking online marketing classes. Many websites give you access to digital courses that are taught by professionals for less than $25.
2. Define Your Goals
When you establish objectives and milestones, you can numerically measure the effectiveness of your real estate marketing strategy.
This way, you will identify the best-performing advertisements and can modify or change the ones that don't meet your expectations. Your goals should be based on your desired budget, profit margins, and timeline.
After you create your marketing budget, you can establish financial and non-financial goals that you want your advertising strategy to attain.
Firstly, decide on the type of results that you want. For instance, do you want prospective renters to fill out a form with their contact information or would you prefer that they directly schedule a property tour time/date online?
There is no right or wrong objective. It all depends on your personal investment budget and strategy.
To illustrate, here are some prominent examples that are especially important to rental real estate properties:
- Lead Generation: Interested tenants can fill out their contact information online, such as through your social media pages. Afterward, you can contact them to schedule a property tour.
- Phone Calls/Emails: Instead of obtaining potential renters' information, you can give out your business's phone number and email via brochures and fliers.
- Appointment Scheduling: Use these marketing objectives if you want interested renters to directly schedule a date and time for a tour through your website or social media pages. You should make sure that users include their phone numbers. Give them a call prior to the appointment to reconfirm it.
Now that you established your non-financial goals, here are some of the most important monetary objectives that your marketing plan should include:
- Maximum Limit: What is the largest amount of money that you're willing to spend on advertisements before renting out the property? Your goal certainly isn't to reach this amount. Instead, you should track your spending and set milestones. For instance, if you spend 25% of your maximum budget without getting any renters, you could make changes to your strategy. The same would apply when you reach 50% and 75% of your spending limit, to name a couple of examples.
- Return on Investment: How much do you want to generate in revenues for each dollar that you spend on marketing? To put it another way, your advertisements will impact your net income (which is your rental revenues minus property taxes, insurance, maintenance, and other business costs). Just as with your maximum limit, you should determine your desirable net income, study how your marketing expenses will impact it, establish milestones, and make adjustments accordingly.
- Cost-per-Result: First of all, identify the results that you want to achieve. This can include “Contact Us” forms completed by interested tenants, phone calls, property tours, and, of course, getting renters. Next, decide on how much you are willing to spend for each result type. If you exceed your limit, adjust your advertisements or focus on other objectives.
3. Study the Real Estate Market
When you research the rental market in your property's area, you will identify the average neighborhood prices, crucial trends, popular themes, and more.
After that, you can shape your pricing strategy based on demand and what your potential renters are willing to pay.
To study the rental property market, you should take the following two steps:
Step 1: Consider the Area and Home Design
If you already purchased a rental property, learn about the main advantages of the location. Is it walking distance from popular malls or restaurants? What is the average rent price? Do you expect it to go up in the future?
Similarly, if you haven't picked an area yet, consider choosing a new neighborhood that's growing. For example, search for residential areas with commercial construction nearby, such as work on building a new shopping center or plaza.
When you identify your location's main advantages, highlight it in your marketing campaigns and advertisements.
Moreover, do you have a design or decor in mind? How new/old do the other homes in your area (or potential one) look? If you plan on renovating the property, use that as a tool to differentiate your home from others in the area.
You could, for instance, showcase your property's brand-new decor or how it will keep the house extra-insulated during the winter. In turn, this can justify a higher-than-average rent price.
Step 2: Learn About Your Audience
When you know who your potential tenants are, alongside their habits and preferences, you can create a powerful marketing strategy that caters to your audience's specific desires.
Empty-nesters and parents with young children, as an example, each have entirely different housing needs. Your advertisements and communications should address them.
There are many ways for you to learn about who your potential renters are. The easiest way is to drive around the property's neighborhood.
If you frequently spot school buses and/or “kids at play” signs, your audience mostly consists of parents with young children.
You should also keep an eye on home sizes, decors, and the types of vehicles parked by them. This can giveaway your potential renters' income and taste.
4. Create a Business Name & a Brand
The right logo design, brand colors, and commercial name will allow you to psychologically connect with your audience and find renters at a relatively quick pace.
In turn, your marketing costs remain minimal while your overall revenues increase.
To get started, you only need a simple and basic design. Therefore, you could hire a professional brand designer for a lower cost or, alternatively, learn how to create one yourself.
How to Choose a Business Name
Firstly, your business name should reflect your property's unique characteristics and what your audience's preferences are.
For example, if you plan on renovating the home and improving its insolation for the winter, pick a business name that expresses warmth, coziness, and comfort. The same would apply if your target audiences are families with young children.
Meanwhile, if your potential tenants are college students, give your business a youthful and energetic name. You should also do so when you plan on renting out a property that has a new and modern design.
How to Create a Real Estate Brand
Secondly, your brand's logo, colors, fonts, and patterns should also mirror your property's features and potential renters' behaviors.
Here is how you can create an effective brand:
- Your Main Color: Many real estate businesses incorporate dark green and/or blue within their branding. This is because those colors symbolize trustworthiness, comfort, and security.
- Other Colors: You can mix your main and secondary colors to create the brand feel that you're looking for. Neutral colors, such as gray and brown, represent coziness and stability. They also blend well with many other colors, most likely including your main one.
- Fonts: As a real estate business, your brand should create a sense of reliability and stability. Fonts that belong to the Serif and Sans Serif families, such as Times New Roman and Baskerville, are effective at doing so. You can also pick a secondary font. Arial, for instance, showcases modernity while Georgia makes your audience feel a sense of comfort.
- Logo: Now that you picked your colors and fonts, you can put them together and design your business's main logo. If your marketing budget permits, you could hire a specialist and ask them to integrate your fonts/colors with your logo. If you want to save money, you can easily use a template and create a professional logo. Certain websites, such as Canva, have many templates and tools that you can utilize for free.
How Your Business Name and Brand Serve You
Above all else, your brand's design has to be consistent across the board. In other words, use your logo's colors and fonts when you create social media graphics, flyers, and brochures.
You should also retain the same visuals for offline and digital marketing efforts.
Consistency ensures that potential renters will remember your brand and recognize it whenever they come across your advertisements, whether it’s in person or on social media.
This is important because, in some cases, renters might be interested in renting your property in the future, such as when their existing lease with another landlord expires.
When your business's unique name and brand are stored in their memory, the tenant is much more likely to contact you when they are ready to move.
5. Establish an Online Presence and a Digital Marketing Strategy
Your website and social media pages make it easy for interested renters to find your contact information and learn about your business.
It is equally important to post pictures of your property on your website and digital media pages. This can make it quicker to acquire new renters.
Just as with your brand, you only need a basic website to get started. You can then integrate your brand's design and logo onto a website template. Alternatively, you could hire a professional to create a simple website at a low cost.
When it comes to social media, set up a business account on several platforms. After that, add a basic description of your business, your contact information, and photos of the property.
Needless to say, you should create posts on popular real estate property listing websites. The most prominent examples include Craiglist, Apartments.com, and Zillow.
It is important to add photos and your contact information under each post.
First, find the most commonly used listing websites in your area by visiting each platform and identifying the most active ones.
Second, utilize search engines and look for apartments in your zip code, neighborhood, and/or city. After that, try to find websites that show up on the first page but, at the same time, have a relatively low number of rental postings.
This is important because it allows you to focus on highly-used digital real estate listing platforms with minimal competition.
6. Get a Business Email and Phone Number
Create an email address that's linked to your website's domain. For example, if your website URL is ComfyHomes.com, your email might be firstname.lastname@example.org.
When your official email address is tied to your website, your buy and rent real estate business will appear much more professional and credible to potential tenants, more so than if you use a personal account.
Many platforms offer URL-linked email addresses for $10 or less a month per email. Try to pick a provider that you're comfortable with and familiar with. For instance, if you regularly use Gmail for personal purposes, establish your business email through the same platform.
A professional phone number also builds your business's credibility and, therefore, makes it easier to find tenants.
If you already have a cable subscription at home, check if your provider offers landlines. Many companies will add one for free to your account (they might even give you a discount on your cable bill).
In the same vein, check if your cell phone provider has any promotions when you add a new phone number. If you expect to work on the property on a regular basis (such as for renovations), a cell phone can be especially handy.
Above all else, add your new business email and phone number to your website and digital/social media pages.
7. Delegate Responsibilities
If you are working with one or more business partners, assign specific roles. For example, determine who is in charge of responding to email inquiries and other digital communications.
Similarly, you and your co-investors could monitor your phone in shifts, which is particularly useful when you have full-time jobs and other commitments.
Meanwhile, if you plan on hiring a property management company or a professional designer, define their roles and responsibilities. Determine, for instance, if the management firm also offers marketing and maintenance services.
When it comes to the designer, decide on whether you will pick the brand's color and theme or leave that responsibility to them.
Going Back to the Start
You should always refer to the first parts of your marketing strategy: the budget and your goals. Next, align them with your target audience's own preferences and needs.
From there, you can choose how you want to communicate with potential renters (e.g., via phone, appointment forms, fliers, etc.) and where you plan on marketing (i.e., social media, your website, listing websites, or through other digital and offline mediums).