Exacerbated by the government's temporary federal moratorium on residential evictions, rent collections across America are way down, and many buildings are struggling to connect with tenants who are months behind. While there are no easy answers here, we have seen operators significantly improve their contact rates and collection plans simply by reaching out to tenants via text.
Rent collections are way down. During this hectic year, many tenants are behind on rent and operators are scrambling to connect with them. Unfortunately, despite email after email, and call after call, many tenants are simply not responding.
If a tenant cannot pay rent, they are understandably nervous about talking to management. But they may not even be aware of provisions their building is making for those who cannot pay. Communication is completely shut down. Landlords do not know for sure if tenants are well and still residing in their units and tenants live with uncertainty when moratoriums finally run out.
It's a lose-lose situation.
However, we have seen that simply by moving these communications to text, operators can cut through barriers that keep tenants from responding.
There is a lot of psychology involved in our relationships with our phones. They keep us entertained and act as security blankets to check when bored or uncomfortable in social situations. We spend more time on them each day as the years go by, and for many of us, texting is the preferred communication channel for our private and business lives.
Psychological studies show that dopamine is released when we respond to alerts from our phones and that texting makes us feel buffered from interactions, freeing us to be bolder in our communications. Studies have shown that psychiatric doctors have better results with patients via texting as they reveal things and open up more than in-person sessions.
Basically, we're all a little programmed to respond to our phones. And businesses have been using this to their advantage, with SMS marketing campaigns increasing over the years. The Wall Street Journal reports that the pandemic has actually increased how much businesses are successfully reaching out to consumers via text.
Now we have a win-win
We see property managers breaking through to tenants with text, allowing them to better connect with tenants and what they’re going through. Once tenants are communicating, they are more likely to commit to payment plans.