After a seven-quarter run, expan-sion moderated for apartment mar-kets according to the National Multi Housing Council’s (NMHC) January Quarterly Survey of Apartment Market Conditions. For the first time since 2010, two of the four indexes – Market Tightness (45) and Sales Volume (49) – dipped below 50, though just barely. The two financ-ing indexes show continued improve-ment for the 8th consecutive quarter, as the Equity Financing (56) and Debt Financing (57) Indexes remained above the breakeven level of 50.

“The pace of improvement in the apartment industry is moderating, but the expansion remains solid,” said Mark Obrinsky, NMHC’s Vice President for Research and Chief Economist. “Lease-up demand is seasonally weak in January, which would fully explain the small drop in the Market Tightness Index. Beyond that, markets were quite tight three months ago, and remain tight today. New construction has picked up considerably since its 2009 low, but is still playing catch-up with the increase in demand for apartment residences.”

Key findings include:Financing remains constrained to

top markets. Only 12 percent report-ed construction financing as avail-able for all types of apartments in all markets. Similarly, slightly more than a quarter (28 percent) thought acquisition financing was available for all properties in all markets. For both construction and acquisition financing, 43 percent of respondents indicated that capital was available for primary markets but constrained in secondary and tertiary markets.

Market Tightness Index declined to 45 from 56. The change ends an 11-quarter run for the index at 50 or higher. Fifty-nine percent of respon-dents said that markets were unchanged, reflecting stable demand conditions. One quarter of respon-dents saw markets as looser, up from 14 percent in October, while 16 per-cent viewed markets as tighter.

The Sales Volume Index decreased slightly from 51 to 49. Nearly half (47 percent) of respondents said that markets were unchanged, reflecting stable demand conditions. One quar-

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February 2013

The CoreLogic® SafeRent® Renter Applicant Risk (RAR) Index Report, formerly known as the Multifamily Applicant Risk (MAR) Index Report, provides market-based benchmarks for evaluating credit quality and risk of default for renters applying for apartment homes in multifamily housing units. The index also includes data from single-family rentals. Using a mean of 100, an index value above 100 indicates decreased risk, and a value below 100 indicates increased risk.

According to the data, the risk of default among renters nationwide decreased year over year in the fourth quarter of 2012 with an index value of 103 compared to the fourth quarter of 2011 with an index value of 101. On a quarter-over-quarter basis, the risk of default increased in

Colorado's Fourth Quarter 2012 Insight Into The

Rental Applicant Risk Index Report

Continued on page 3

By: Jay Harris, Vice President of Business Services, CoreLogic SafeRent

The Landlord TImes recently caught up with multifamily hous-ing veteran and blog-ger, Heather Blume. Here’s what Heather has to say about apart-ment management,

teaching, her mentor, marijuana, eat-ing lunch and relationship artistry...

TLT: What is it about multifamily and rental housing that has kept you motivated and interested?

HB: I love the fact that no matter the background or skill set that you bring to the table in this industry, it’s valu-able. For example, I was an artist, a photographer, a playwright, a florist, a radio disc jockey, and had more than a few retail jobs in my past, but all of those skills translated in this professional world as a powerful

set of abilities. Leasing was the first job I ever held where I felt like I was bring something worthwhile to the job, rather than just learning from it. Knowing that I found a place in this world where I “fit” perfectly…that was a powerful motivator for me, and still is today.

TLT: What do you consider your greatest success in your career?

HB: It’s cheesy, but the greatest suc-cess moments in my career are when I’m looking at a room of people, teaching something, and I can see the light bulb over one of their heads switch on. They get this look and you just know that some how you’ve been able to reframe an idea or a concept in a way that they just…get it. Every single one of those moments are my greatest successes, because I know it makes someone’s career better.

TLT: Who was the most influen-tial person in the early part of your career? What did you learn from them?

HB: Hands down, Lisa Trosien has been my beacon in this industry. Be-sides being one of the most talented and smartest people I know, she’s my mentor, my guide, my friend, my cheerleader, and, when I need it, the person who sticks a pin in my ego to deflate it back down to a normal level. I took my very first class in this industry from her when I started on site, and after watching her for less than 20 minutes I knew exactly what I wanted to do with my career. I re-member approaching her after that class, introducing myself and asking her what steps I had to take to do the job she was doing. She inspired

6 Questions with Heather Blume

Continued on page 4

Expansion Moderates for

Apartment Markets in

January

ecently I caught myself con-templating the importance of

signs. Whether it’s to draw our eye to a new place of business, (Harry’s Hamburger Joint – Grand Opening!) remind us of a political candidate (Vote for Honest Abe!) or tell us what to do when we are driving, (merge, yield, slow, STOP!!), signs are every-where, vying for our attention.

Recently, while stuck in traffic, a daily occurrence for most of us, I was overwhelmed by the sheer volume of signs I noticed while inching along. Some were informational, like speed limit signs, exit names and numbers, and “low clearance,” while other signs provided instructions and issued warnings: “yield to oncoming traffic” and “right lane ends merge left,” as well as “proceed with cau-tion.”

You probably think I am leading up to a discussion of bright, brilliant, breathtaking signage to attract pro-spective renters to your communities. Right? Wrong! Here is MY question:

Q: Wouldn’t it be great if everyone who came into your community was wearing a sign to clearly communi-cate their most important needs and preferences, as well as thoughts and feelings? - WANTED: 2 bedroom apartment with lots of closet space. I like to work out, ride my bike on sunny days and cozy up to a warm fireplace with a good book on a cold winter morning. WARNING: I am extremely allergic to cats, value my privacy and resent being asked basic, mundane qualifying questions for the sole purpose of filling out a guest card! HANDLE WITH CARE: My husband was just diagnosed with cancer and I need to rent an apart-ment near the hospital where he is having his surgery and ongoing treat-ments. AND, the list goes on . . . .

A: I realize that it can be difficult and uncomfortable to “qualify” pro-spective renters, as you may feel like you are being intrusive. – I commend you for respecting the privacy of your clients. However, you cannot deter-mine what someone needs in a new home if you don’t take the time to get

to know that person. Most people will naturally talk about themselves, their family, work, interests, etc., if given the opportunity to do so. They may even reveal the circumstances of their move. This will enable you to offer an apartment (or choice of apartments) to best meet their needs. You may also learn enough to sell them on (specific) benefits of your community, its loca-tion or the local area, that fulfill other requirements they have besides just housing. For those individuals who feel uncomfortable articulating their needs or just aren’t open to a lot of fact-finding questions, it’s best to seek their permission before proceeding. For example: “Is it okay if I ask you a few questions so I will have a better understanding of what you need?” AND THEN: “Is there something spe-cific you are looking for? What is most important to you in your new home?”

To state that you have the “perfect” apartment for someone you know nothing about is presumptuous at best, rude and uncaring at worst. MAKING the time to discover what your clients need, will not only help

you close the front door on a rental, but the back door on a lease renewal. Renters will remain residents for the very same reasons they leased in the first place. – It’s your job to know what those reasons are, and regularly remind them!

If you have a question or concern that you would like to see addressed, please ASK THE SECRET SHOPPER. Your questions, comments and sug-gestions are ALWAYS welcome!

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ter of respondents saw markets as tighter, with nearly the same (26 per-cent) indicating looser markets.

The Equity Financing Index remained unchanged at 56. This reflects the 14th quarter in a row with the index above 50. Approximately two-thirds (68 per-cent) viewed equity financing as unchanged, while 20 percent of respondents thought equity financ-ing was more available and only 8 percent indicated equity financing was less available.

Debt Financing Index declined from 65 to 57. Seven in ten (71 per-cent) reported conditions as unchanged, and only 6 percent believed that borrowing conditions for debt financing had worsened – the eighth consecutive quarter in the single digits.

Full survey data are available at www.nmhc.org/goto/61043.

About the survey: The January 2013 Quarterly Survey of Apartment Market Conditions was conducted January 7-14, with 87 CEOs and other senior execu-tives of apartment-related firms nation-wide responding.

To view this release online, visit www.nmhc.org/goto/61044.

Based in Washington, D.C., NMHC is a national association representing the interests of the larger and most promi-

nent apartment firms in the U.S. NMHC’s members are the principal offi-cers of firms engaged in all aspects of the apartment industry, including owners, developers, managers and financiers. One-third of Americans rent their hous-ing, and over 14 percent live in a rental apartment. For more information, con-tact NMHC at 202/974-2300, e-mail the Council at info@nmhc.org, or visit NMHC’s web site at www.nmhc.org.

the fourth quarter 2012 compared to the third quarter of 2012 when the index value was 106. The increased risk from the third quarter to the fourth quarter of 2012 reflects a risk-ier applicant pool that is typical in seasonally slower periods of appli-cant traffic. For additional regional data and renter trends, visit http://www.corelogic.com/about-us/news/corelogic-releases-q4-2012-renter-applicant-risk-index-report.aspx.

Here is how Colorado performed in the fourth quarter compared to last year: • Denver-Aurora-Broomfield, CO:

4Q12 RAR Index = 105• Denver-Aurora-Broomfield, CO:

4Q11 RAR Index = 101

The SafeRent Renter Applicant Risk (RAR) Index Report is pub-lished quarterly by CoreLogic. The RAR Index is calculated exclusively from applicant-traffic credit quality scores from the CoreLogic SafeRent

statistical lease screening model, Registry ScorePLUS® and is based on an analysis of 39,000 properties representing nearly 6 million apart-ment homes and single-family rent-als. The index provides a benchmark trend of national and regional traffic credit quality scores.

Data is also available at the prop-erty and sub-market level with our analytics tools. For additional infor-mation or the full press release, visit corelogic.com.

CORELOGIC, the stylized CoreLogic logo, SAFERENT and REGISTRY

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my path through this industry and through my career, and I can never repay her enough for it. I’m confident in saying that I would not be the per-son I am today had our life paths not crossed in such a significant way.

TLT: What are the biggest legislative topics/concerns right now?

HB: In my home area, Washington state, we just legalized pot. As you might imagine, this presents some interesting challenges in the world of apartment management. One of the biggest confusion points that people have is thinking that smoking pot is now a protected class under Fair Hous-ing – it’s not. Just because it’s legal to smoke it, doesn’t make it protected. It’s like cigarettes, and as we all know, those have nothing to do with the Fair Housing laws. For tax credit proper-ties, it can get even more complicated. The new laws in the state of Washing-ton have caused a bit of confusion…and most of that’s rooted in the fact that the laws aren’t even set yet.

TLT: If you were talking to a multi-family newbie, what advice would you give them as they begin their ca-reer? HB: I’d tell them that the key to this in-dustry and being successful in it boils down to relationship management. It’s not enough to just never burn your bridges. Anyone can avoid doing that if they’re smart. Strive to be someone who can take the common relationship where you say “hi” socially, but don’t

really know anything in depth about the person besides that you want them to buy from you, and turn that in to a relationship where each person is giv-ing as much as getting. You want to build relationships that are mutually beneficial, where respect and integrity are the cornerstones of the construc-tion. A person that can achieve that is a relationship artist. Competency in relationship management is a must… Artistry in relationship management.

TLT: Generally speaking, what 2 or 3 pieces of advice would you give to a room full of property managers?

HB: First,for the love of all things holy, please take your lunch, take it away from your desk, and eat something that has a lot of protein in it. Because when you don’t eat or eat something that messes with your blood sugar and you get cranky at 4PM, your staff mirrors your mood…only they show it to your residents. Eat your lunch.

Secondly, most managers already have learned this (some of them the hard way), but you can’t cut some-one’s throat to get their job. This piece of advice is one that was told to me

during my first week in this industry, and it has served me well.

Finally, in the same vein as number 2, if you’re afraid to teach your subor-dinates to do new duties because you “won’t have anything to do,” then you’re failing not only them, but your-self as well. You’re a manager. You got your job by being competent enough to convince someone that you deserved the promotion, so why let yourself feel threatened by someone else’s success? Your job is to build your team, not keep them down. The best managers I know are the ones who are secure in their own abilities, so they have no problem helping someone else grow.

Heather Blume is the Imagination In Charge at Behind the Leasing Desk Training & Consulting Services in Seattle, Washington. She works with clients across the country on a variety of topics in the multifamily and customer service industries, and her blog at www.behindtheleasingdesk.com is read by hundreds of property management profes-sionals each month. Always accessible, you can reach her on Facebook, LinkedIn, Twit-ter, Google+, and, of course, via email at heather@behindtheleasingdesk.com

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