Are Your Virtual Tours Destroying Value?
TL;DR (Summary)
Virtual viewings promise efficiency and cost savings, but they often lead to lower achieved rental values and fewer committed tenants. While tech advancements will improve digital leasing, the current solutions do not fully replace in-person experiences. Home Made is at the forefront of this evolution—contact us to optimise your leasing strategy today.
The Shift to Online Leasing
Tenant behaviour has changed. The Covid-19 pandemic accelerated a digital-first approach across industries, including real estate. Consumers shop online more, and similarly tenants are willing to engage with online listings more. For some, virtual tours are their only option—such as those relocating from abroad. This shift has driven landlords to explore digital leasing solutions, aiming to reduce operational costs and speed up lettings.
The Promise of Virtual Tours
For years, Build to Rent (BTR) landlords and operators have hoped that virtual viewings could replace the expensive and time consuming in-person and accompanied viewings. The potential benefits include:
- Reduced cost to serve
- Faster leasing cycles
- Broader reach to international and remote renters
In response, many providers—particularly in the US—have developed various virtual tools, including:
- Matterport 3D walk-throughs
- Interactive floorplans
- AI-assisted self-guided tours
But does this technology deliver on its promise?
The Reality: Are Virtual Tours Costing You?
We speak with large US multi-family owners frequently, and the consensus is clear: the current state of virtual tours does not maximise Net Operating Income (NOI). Here’s why:
- Reduced Engagement from High-Intent Renters
Many renters prioritise in-person viewings over virtual options. When given a choice, they prefer to visit units physically, bypassing those that only offer virtual tours. For example, if they have two options, one offering online tour and another not, they’ll take the online-only and compare it to the in-person visit of the other. - Lower Rental Values
Our data shows that online-only offers tend to be lower than those from in-person viewings. Renters need confidence in their decision, and virtual tours lack the trust and certainty of an on-site experience. - Familiarity Gaps
Tenants who lease purely through virtual viewings often lack local area knowledge. They move in without a real feel for the neighbourhood’s amenities, transport links, and community dynamics. This can lead to dissatisfaction and higher churn rates.
What’s Next for Virtual Leasing?
Technology will eventually bridge the gap, and we anticipate a future where hybrid and digital-first leasing models become the norm. However, the current tools are not yet sophisticated enough to fully replace human-led interactions.
At Home Made, we stay ahead of these trends, blending technology with our expert, data-driven leasing approach.
We offer a range of services, and in parallel work to develop the next generation of BTR tools to allow for the optimal asset valuations. We offer a seamless hybrid leasing experience, optimised strategies that maximise rental values, and a bespoke tenant journey that builds long-term satisfaction.
More innovations are coming, and we’re committed to leading the charge.
Take Action
If you want to optimise your BTR leasing strategy and enhance your NOI, we’d love to talk. Contact Home Made today to explore how our expertise can help you outperform the market.
