This post is all about showing you the difference between Apartment Locating & Private Market Condo leasing
The Product - Apartments
These are the stars of the show. Apartment complexes are large residential buildings typically owned by large real estate investors managed by professional (but not always competent) property management companies. They usually have on-site leasing offices staffed by leasing agents who take care of touring, writing up leases, and other administrative work.
Private Market
These are properties owned by individual landlords. These transactions are closer to typical real estate transactions where you do the whole contract and negotiating/agreement stuff.
I don't work with these since the pay is much lower, and the work is much higher. But depending on your market it could be worth exposing yourself to this market as well.
Let's get into both.
Apartments vs Private Market
Apartment Pros
Super easy online applications.
This means you, the locator, don't touch any of the contract details and negotiations. That happens between your client & the apartment complex.
- Low deposits (rarely more than a few hundred dollars)
- On-Demand Maintenance staff
- plumbing, pest control, etc
- Amenities (most of the time)
- Pool, gym, work space, etc.
- Social Events
- Some apartments put on social events so their residents can mingle and meet each other.
- High commissions
- Publicly available reviews
- Cheap Database - No MLS Needed
- Specials
- Apartments often offer free weeks/months to new tenants.
Apartment Cons
- Management companies can be shitty
- Apartments can be very generic and standardized.
- Not much variety.
- Commissions can take long to pay out.
- Weeks/Months after your client moves in
- Invoices are a pain in the ass to hunt down
Private Market Pros
- Tenant can have a personal relationship with landlord and get good deals.
- More boutique options
- Houses
- Townhouses
- Condos
- etc
Private Market Cons
- Traditional paperwork heavy contracts
- Landlord can sell the property and new owner can kick the tenant out.
- Higher deposits (1-2 months + full month security deposit)
- Low/Lower commissions
- In Austin, my main market, private market commissions tend to be around 30% of a months rent, compared to the ~100% for apartments.
- More paperwork for you.
- Negotiating, storing lease agreements
- Expensive Database (MLS)
- Data for private market condos/houses comes from the Multiple Listing Service (MLS) which costs thousands per year.
Apartments and the Private Market are parallel markets. This course will focus on the apartment rather than the private market.
In my case it makes the most sense for me to focus 100% on apartment rentals instead of the private market. It will be up to you to determine if branching into the private market is right for you