Why do Apartment Rent Rates Fluctuate?
OMG! Why did the rent rate increase in just one day? Or why is the rent rate different than the price on my list? Or I saw this same apartment on another website and this floor plan was listed at $XXXX price, why the difference? I am asked so often questions like this I decided to write a blog post to help explain WHY. It can be frustrating when the affordable apartment you liked yesterday may not be so affordable today. You may be asking ‘how can the prices keep changing?’ There are many factors that affect apartment rent rates; here are some of the biggest to keep in mind while you hunt for an apartment.
SAME FLOOR PLAN DOES NOT ALWAYS = SAME PRICE Almost all apartments have a starting price on each floor plan offered. Many times the price they advertise is the starting price. You find a 2 bed 2 bath that is advertised as $1400 and you go in to tour and the cheapest 2 bed 2 bath is $1600. Say what? Apartments charge different rates by floor-plan but they also can charge different rates based on other factors such as the floor the unit available is on, for example a 1st floor unit may be a higher rate than a 3rd floor unit. Also, if certain units in a community have upgrades then those units will typically lease higher than a basic unit. Or if a particular unit has an amazing view the price will likely be higher. This especially true if you are looking at high-rise apartments. SUPPLY & DEMAND Apartment rates can fluctuate daily (even more often) and the change is due to supply and demand. As an apartment reaches high occupancy rates the rent rates tend to rise and they are not pressed to offer specials. When an apartment has low occupancy rates, meaning they have lots of vacant units or units on notice to vacate the price may drop and they may run some specials to get those units leased faster. The rate can fluctuate either way.
DYNAMIC PRICING SOFWARE What is Dynamic Pricing Software? It’s basically an algorithm that determines the optimal price for a specific date and time. Remember the last time you shopped online for an airline ticket? You may have looked at prices one evening to get an idea of the costs and then you go back to purchase your ticket a day or few later and you noticed the price has changed. As the seats on the plane are purchased the rates change. As the flight reaches max occupancy the rates on the existing seats will tend to rise. Airlines have been using this technology for many years. Many apartments are now using this software. As units lease or notices to vacate are turned in - the info is entered into this software program. This is how prices can change same day!
MOVE DATE The move in date can affect the rate. For example you find an apartment unit that becomes available on the 26th of the month, but you can't move in until the 1st of the coming month, the rate if you moved in on the 26th is likely to be less than if you wait to move in on the 1st. WHY? Because every day that unit is sitting vacant the property is losing money. If they agree to hold it for YOUR desired move date they are going to lose the opportunity to lease it sooner. LENGTH OF LEASE Usually longer lease terms have a lower rate but this is not always the case now that many apartments use Dynamic Pricing Software. The apartment community does not want a ton of leases ending at the same time. So this software is designed to have leases ending at different times to prevent the occupancy rate to plummet. You may be offered a lower rate on a 10 month lease or a lower rate on a 14 month lease. It just varies. DON'T RELY ON THE RATE UNTIL YOU GET A FORMAL QUOTE FROM THE APARTMENT ANY apartment rate you see on ANY website, even the apartment complexes own website is subject to change without notice. To get the most accurate pricing don't call or have your locator call properties to get pricing and availability until you are ready to tour. If you call a week before you tour you can expect the information will likely have changed. Call the same day or the day before you plan to tour to get the most accurate info. Always get the unit number of the unit you received pricing on. Again, this info can still change but is less likely if you are calling within 24 hours. Many times leasing staff will tell you, this is the price as of NOW or as of TODAY, our prices change daily.
Now that you understand why apartment pricing is so fluid it will take away some of the frustration. Always consider rent rates listed are the APPROXIMATE rate. Leasing agents and locators want to provide you with accurate information, however, because prices and specials can change at any moment AND prices can vary by move date, length of lease, floor location, and upgrades - it is near impossible to provide accurate information until you are in the apartment office READY TO APPLY for a certain unit.
Need help finding your next apartment? We would love to assist you! Plus, when you use Texas Apartment Locating’s free locator services you are eligible for a CASH Rebate or Move Credit! Best of all, this is in ADDITION to apartment community special offers! And using a locator does not affect your rental rate at all. Start your apartment search today! www.texasapartmentlocating.com/search