[brightball]

I got to talk to one of the wealthiest apartment owners in my state a few years back. He gave me a lot of details of his financial formula, which was really interesting.

But one thing is found critical is that he always made sure his apartments were priced at the low end. He’d rather make sure they were all full all the time instead of dealing with volatility.

The man is hugely successful and they just named one of the colleges after him at my University.

[welshwelsh]

RealPage's formula is largely the opposite of that.

Before RealPage, most large landlords would aim for 97-98% occupancy and set their rents accordingly.

RealPage would encourage landlords to instead aim for 90-95% occupancy by setting higher rents. Most of the time, this turned out to be a more profitable strategy, even though it makes property managers nervous because they feel like empty apartments = lost money.

[shapefrog]

It is very basic maths as well (that evades most small time landlords).

100% occupancy at 90% of the market price with high quality tenants makes you more money than 80% occupancy + agent advertising / finding fees at full market price with bad tenants.