Do Guarantees Work? with Chuck Hattemer

Do Guarantees Work?

Chuck Hattemer of Poplar Homes is on The Property Management Show today, talking about the property management guarantees his company implemented more than six years ago, and how they’ve helped him build a better property management business.

The Idea behind Making Guarantees a Marketing Strategy

Chuck and his business partner have been running Poplar Homes since 2014. When they started the company, they quickly noticed how much anxiety there was around income stability for real estate investors. A lot of the landlords they were marketing to relied on timely rent payments to pay their mortgage, insurance, and maintenance. They heard horror stories around evictions.

There was a situation in which Chuck and his partner had to help a new owner with an eviction. The tenant had managed to completely steal someone’s identity and moved into a home with an $8,000 per month rent payment. After the eviction process had begun, they went into the home to make sure the tenant had moved out.

Ever since that experience, Poplar Homes has gone above and beyond what is necessary to make sure properties are secure and owners feel safe with their investments. The owners involved in that eviction became immediate advocates for their property managers, and it demonstrated to Chuck that if property managers can take care of the root of that uncertainty that so many owners and investors feel, it could become part of their process.

That was the beginning of the guarantee program: income stability and evictions.

It’s a perfect example of turning a common pain point into a unique sales proposition.

Rent Guarantee and Eviction Guarantee: How They Work

Chuck’s company implemented these guarantees before they were common:

* Rent is guaranteed to arrive to the landlord by the third business day of every month.

* Evictions, if necessary, are covered for up to $15,000 of legal fees.

To implement these guarantees, risk assessment is necessary. But the results have been pretty clear. Most customers surveyed name these guarantees as the reason they chose to work with Poplar Homes.

While a lot of companies throw guarantees around when they’re marketing their services, for Chuck it works because this service aligns with their brand. Their mission is to be a partner with the property owner throughout their real estate journey. All the other services you provide have to be solid before you can start making guarantees.

Check out the Poplar Homes website, and you’ll see that their guarantees are front and center. The storyline throughout the website content is that their services are guaranteed. This messaging mentality is also part of who they are, and why they’re so successful with this unique point of service.

Chuck says it’s about reaching their audience. The majority of single-family rentals are managed independently. By having guarantees, they’ve been able to reach into that audience of DIY owners and show them a new style of property management that they can trust. They’re guaranteeing the residents they place, which helps them address some of the negative emotions that a lot of landlords still hold when it comes to property management.

Implementing Technology to Support Property Management Guarantees

A lot of property management companies have begun guaranteeing rent no matter what. That’s dangerous and difficult to sustain. Chuck does not guarantee rent during vacancy periods, for example. There’s too much risk there.

Instead, their rent guarantee is pretty specific to what owners really want: timely payments. It’s hard to imagine how they can promise that rent will be deposited by the third business day of the month. What about grace periods and processing times?

They’ve built the technology to support that guarantee.