My thoughts on where I see rental market technology heading in 2023 and beyond.
In times of unrest, don’t fall asleep. Opportunity is knocking.
RENTAL PREDICTIONS FOR 2023
#1: The Digital Adoption Hangover
During the pandemic, digital adoption within the rental market experienced a state of acceleration, however, the motivations of property managers driving adoption of everything from point solutions to platforms were largely anecdotal. The need for these solutions hasn’t been a question, but now that they've been adopted, we’re seeing things more holistically and, in turn, have greater ability to analyze utilization and ROI.
#2: Ecosystem Transparency Raises Questions
It’s 2023, and the stage is being set for the rental market to go through its most significant transition ever. Property managers will see their relationship to technology change in big ways, and the rental supply chain will gain the prominence it has in other industries. Pete Flint of NfX Ventures, also noted that property management hasn’t seen a true ERP solution hit the market yet, but this inevitably will change. Traditional property management software wasn’t built to look beyond the physical property, nor did it have respect for the importance the consumer would have today. I believe we’ll finally see the first big signs of this in the months to come.
A greater respect for the “ecosystem” will bring further awareness to the supply chain and put the incremental costs embedded within per-unit pricing into question. Transparency will bring many point solutions and their respective ROI under greater scrutiny than ever before. This in turn will accelerate consolidation, and for others, it will be “death on the vine.”
#3: Service Groups — Prepare For Battle
The extended effects will eventually begin to liberate the rental ecosystem as a whole. Property managers will start to see savings on SaaS fees and will begin to see the importance of managing “the ecosystem over just the property”. This will bring other, more sophisticated business models to light. True utilization, tiered, or personalized pricing models with greater outcome specificity will be highly sought after.
Much of this awareness will be the result of service organizations finally having a less restricted seat at the table (though they will begin to share their seat with more cost-effective, progressive, AI-related tools within the stack). Point solutions will be more effectively positioned and deployed in ways that enable them to deliver on their promises. Something that has largely not been the case. This will reduce costs and inefficiencies. The higher unit costs of these point solutions that have been driven up by property management software will be exposed, thanks to greater transparency.
#4: Consumers Get Served
Consumers will be at the center of this change, and it’s high time this happens in a big way. After all, it’s the reason digital tools are being pushed far beyond accounting or maintenance. We fully realize that renters are ultimately the ones who keep our great rental ecosystem in tact.
With this, the industry will see a shift in how we provide a more omni-channel approach to supporting and guiding consumers through their lifestyle decisions. This will happen at a greater rate throughout both the short-term and long-term rental sectors.
To better engage the renter consumer, marketplaces will, expand their purchasing power and increase the simplicity of fulfillment. This will create greater outcomes and upward mobility. As I stated prior, supply chain awareness and transparency will bring quality and ROI into question for all of proptech.
A “flight to quality” for the venture industry means a reversion to revenue models that are profitable and predictable. — Merritt Hummer, Partner at Bain Capital
#5: Long-tail Liberation — Small Portfolios Begin To Play Big
The availability, accessibility, and affordability of more holistic digital ecosystems will fuel cross-sections of the rental market that were previously considered “long tail," thus reducing fragmentation in many ways. These smaller portfolios, with less budget and connection to the greater industry, will find more balance and scale opportunities. The increase in digital adoption across these smaller portfolios that make up the majority of our rental market will allow them to offer competitive solutions to that of more institutional level property management firms like Greystar or Avalon Bay.
Not all of this may happen within the next 12 months entirely, but the seeds have been planted and are breaking ground now.
This is a new era of opportunities, no longer managed by property management software. This is REM.
LEASERA is the only rental ecosystem management software (“REM”) solution available to today’s rental ecosystem. Our rental platform offers a unified management suite equipped with an on-demand rental marketplace and loyalty system. We integrate connected travel accommodations and direct-to-door services like dog walking, food delivery, and ride sharing for our property management clients and their consumer communities. We provide fast moving property owners and a dynamic renter demographic with the benefits and options needed today. By serving our property management companies, and property investment groups, as well as our partnerships with hotels, travel rentals, investment groups, and more, LEASERA has ushered the rental ecosystem into a new era.
LEASERA offers our PMC clients added value across their long-term rental portfolios with consumer-loyalty, an intelligent leasing-as-a-service platform, and an integrated marketplace of supportive tools and service providers. Consumers gain rewards, empowerment, and flexibility. LEASERA is a portfolio company of Second Century Ventures, was named Plug and Play’s top 50 Proptech Innovations, CREtech’s Hot List as one of the “Top Companies to Discover in Real Estate” and as a “Leading tech site to discover” and has been dubbed years ahead of the market by industry investors, professionals, and insiders.
Welcome to a new life on leasing.
