February Rental Reality Check | Top 3 Markets Breaking the Pattern

0:00This episode is brought to you by Indeed. Stop waiting around for the perfect candidate. Instead, use Indeed Sponsored Jobs to find the right people with the right skills fast. It's a simple way to make sure your listing is the first candidate to see. According to Indeed Data, sponsor jobs have four times more applicants than non-sponsored jobs. So go build your dream team today with Indeed. Get a $75 sponsor job credit at Indeed.com slash podcast, Terms and Conditions Apply. What is going on in the rental market? I'm not sure if you're aware of this, but historically speaking, February is always the worst month, the slowest month to lease properties. What happened in 2026? Did that data reverse? Is there a growing trend? And we will also answer the question you want to know. What is the top three cities with the fastest lease up? And of course, we will also hit the slowest lease up. We're going to do this with Dana Dunford, the CEO, Himlane with over 100,000 units.

1:03This is not a small operation. So we're going to get into the weeds. Dana, what's say you? Great. Well, thanks so much for having me here. I always worry February is my least favorite month. Honestly, between November and December as well, I really don't like those months because they're slow movement. But it's interesting in just tracking the numbers and where we are because February, we saw some really positive results. So back in, I'm going to do median days on market. So in December, we saw 32 days on market. January, we saw 33 days on market. And usually January goes in the opposite direction because everyone's kind of moving for the first of the month. But February went down to 28 days on market. 28 days on market. And for our tenant placement services, that's if they're showing seven days of the week, that went down to 19 days on market. So what I like about that is the trend is going in the right direction.

2:07And it was interesting because we had some stand-out states, I would say, where... Well, let me, before we get to the states, I want to ask you a question. Just to make sure we all understand days on market. So days on market starts with the move out. And then does it stop with a lease signing? Or is that a move in? When does the clock stop? Yeah, we stop it when the rent is being transferred. And the lease is signed. I cannot tell you how many times I tell every single landlord or manager this, do not turn off your posting until you have funds in transit. Yes, please. There is so many times that you turn it off, and then you say it's no longer available. And then suddenly the tenant doesn't have the funds, or they just back out and they're like, Yeah, it goes. It's funny. I can just suddenly change my plan. And you don't have any sort of deposit to say, listen, this is actually going to cost me more time and money to put this back on the market.

3:08Meanwhile, every other tenant, you've notified this is no longer available, and they found a new place. We do it from the move out time, all the way until when you have funds in transit. Usually what we see is the lease is signed first. We always say you have 24 to 48 hours to initiate that first month's rent and the security deposit. And you may negotiate something different. You may say just the security deposit first and the month's first month's rent can come in a week, but you just need something there to know to take it off market. Love that, love that. And again, the whole point of this is February historically has been the slowest month. This year something is different. It was roughly 10% better overall and significantly better when you all were helping 10 displacements down to 18 or 19 days. So congratulations. That's clearly that's clearly a service. More people need to check out. You saved 11 days. Well, I think that's also kind of the anxiety of the team because our team is our leasing team is based

4:11as you've leasing coordinator. And their entire like scorecard metric is like satisfaction and how many days on market. And so for them, it's they're really trying to push to say how do we get this off market creative things. And you know, the other interesting thing is we've had to and this is more qualitative than quantitative with some of our larger partners. So those with over 400 properties, we've heard from them in their tenant placements that we are not even having to give offer as many incentives. So it used to be like especially in October, November and December of this year. We were offering $500 off if you move in the next 15 days. Like, or if you sign the lease in the next 15 days, 50% off your first month's rent if you sign in the next 30 days. There was a lot that we were trying to do from an incentive side, especially if the owner or manager didn't want to reduce the rental rate.

5:12And we're not seen as much of that. And so that's really good because it's very positive for us. So it means there's something going on at kind of more of a macro level that tenants are moving and getting used to saying, hey, I'm okay going to a new home from where I was comfortable or more. Yeah, again, the fact that February was different, the fact that I love the fact that your leasing team is measured on what matter, satisfaction, and leasing, having for bed, they're focused on that. So kudos to you. Let's flip to, what do you want to do first? The fastest or the slowest state? Let's start with the fastest states to, yeah, the fastest states to fill a property. So what are the hot states where people are moving? And let me give you a hint. The first two really surprised me because they are places where I wouldn't expect tenants to be moving in the month of February, especially the first one.

6:12Yeah, so I was always going to go here first. I'm going to assume it's in the northeast. Yep. Yep. Yeah, so I'm going to go Connecticut. It's Massachusetts. Oh, I was close. I thought about Massachusetts. Massachusetts. And so Massachusetts was 11 days on market. Wow. Yeah, and what's crazy about that is no one wants to move in Boston. And this was just over 1,000 listings. So like the actual is quite a bit. So that was very surprising to see. And then the next one, it might be a hard one to guess. Is Pennsylvania? Pennsylvania was at 13 days on market. So again, some things going on in the northeast there. Pennsylvania, maybe you don't call it totally the northeast, but I'm sure there are these coasts. Yeah, it's really funny because again, I get a lot of this from Lance Lambert.

7:12There's that like from Ohio up to Maine, whatever you want to call that part of the country, this is very different than the rest of the country. Less listings, faster days on market to sell, prices are still rising, leases are faster. So I don't know if that's lack of building. It probably actually now that I say it out loud. It just probably is a lack of building. Interesting. Yeah. Yeah, because again, when you think about where the building is, it's the smile, right? It's the lower part of the country. Yeah. That part is very aged out. Also, you're having less migration out. I think 2021-22, there was a lot of migration out to the south. That's probably stopped. And it's probably reversing, right? If humans, you know, do what humans always do, they boomerang back to where they were from. So yeah, maybe that's just a, maybe what we're sensing is a building thing. So number three, I'm just going to go Ohio, just the fun. Not one. Yeah, a good guess in a lot of ways. I find these markets to be similar, but it was Mississippi.

8:12Oh, I would have never guessed it. 90 days there. How many units there? And then you're probably interested in California, Texas, and Florida, because I feel like everyone is. California is better than Texas and Florida. California was 22 days, whereas Texas and Florida were 34 and 35. Yeah, it's funny. When you bring up Texas and Florida, I really think you have to look at those in trend. Why do I say that? Because I think Texas is already bottom and is coming around. I think at least, like, what do you say Texas was? How many days, sorry? 34 days. Yeah, if you were to ask me what Texas was in November, I would have guessed 40 days. Yeah, I can actually easily pull that for you. I'll check it. I'm going to check it for our next one. Yeah, because again, what I think is happening in Texas is Texas is already bottom. And I think Florida is about to bottom. Because again, I think we're like in Texas for sure, we're already starting to see the tail end of apartments coming online.

9:13And then there's just going to be this big dirt of no new construction. Yeah. So, you know, it's funny. I think Texas is bottom. I think Florida is about to bottom. But yeah, it probably doesn't surprise me that Californians better than those two. Why? Lack of building. Again. Yeah. It's hard to build here. Yeah, yeah. Oh, all right. So now we're going to go with the three slowest. Slowest. Yeah. Who are your turtles? Not your alligators, but your turtles. Yeah, my turtles. God, I don't know how to do this. How would what would be slow? Can you give me a hint? Yeah. One of them is Southwest. It surprised me because we do have quite a bit of inventory in this. Oh, well, I was going to say New Mexico, but now I'm going to switch to Arizona. It's Arizona. Yeah. 52 days. All right. 52 days. It's like that's such an anomaly. If you think about that, that's a month and a half.

10:14And that's. Do that's almost two months. Yeah. And it's that's actually just crazy to me that Arizona. I don't know what's going on with Arizona. Well, I think that I think Arizona. Well, again, I think it's the apartments. I think apartments are coming online. And you're, I mean, the apartment owners, they are doing two months free dollar deposits. Yeah. It's pretty hard to compete when you're when that's the competition. Right. Yeah. Okay. So Arizona, that actually makes sense to me. Gosh, let's go Tennessee. No, um, it is Hawaii is the next. Oh, of course, 46 days on market. And then Michigan followed by Michigan. So who I make sense to me? Because again, it's not a lot of migration. Right. You're kind of you're kind of you're filling it in with the existing population. Yeah. And then Michigan's interesting. Because Michigan's really interesting. Well, I guess winter. Which that could be, but then you thought the same thing with Massachusetts and look at Pennsylvania.

11:15Yeah, you're right. Yeah. So it is interesting to see, but I think that the kind of level setting there is like, especially when you're looking at properties to purchase. So much of this days on market will help you understand the market to your point, like at a macro level, um, saying, Hey, Texas, Florida, some of these are at the at our bottoming out here. And understanding that because then you start marrying your scope and saying, OK, here are the target cities and then here are the target neighborhoods. And so it's good to just look at those trends because I think it's so helpful. Even for me, I've made some mistakes of like purchasing a property. I mean, like thought there was going to be a lot of tenant demand and there is end and it has so much to do with the market. And so really tracking this stuff. We're going to start publishing these reports every single month. I'm just in the data over time as well. Love it again. You've got the data set 100,000 units plus very, very valuable. I appreciate it. Dana, where can people go?

12:16Check out him link. Yeah, you can go to hemline.com, e-g-m-l-a-n-e.com. In resources, we also have like a rental rate reports analysis, like all of that that you can get on the resources tab. And then and no cost, you can go ahead and advertise your property to over 15 listing websites. Wow. And so you can do that with the click of the button. Just mention one rental at a time because if you do decide to use our property management services, you get our biggest discount, which is 20% off your first year. Nice. And just give you a little tease. I'm going to ask Dana and Mark, the financial firefighter, to do a special session inside school about how Mark uses hemline for out-of-state investing. More and more people are going out-of-state. Might as well learn inside school how Mark, one of our members is using hemline to manage from Hawaii all the way out in Pennsylvania. He knows that his days on market are so high in Hawaii that he has to go to a place for days on market where his properties are being leased right away.

13:17There you go. There you go. Use hemline for out-of-state investing. Thank you so much. Take care. Thanks so much. Two kinds of fishing out here. One for fish, one for your data. Hackers try to hook you. But Cisco Geo keeps every user and device protected. Cisco Geo, fishing season is over. Buy more at www.chuoe.com.