Are Late Fees Doing More Harm Than Good?
Digested from Addicted To Late Fees: Why Budgeting Badwill Leaves Us Vulnerable from Multifamly Insiders (9/14/16) by Velazquez, Jason
Do late fees actually work?
We all know that any consumer or resident hates to be charged a late fee and will be quick to resent it. No one likes to feel that someone else is profiting from his or her mistake or financial pinch. Property managers should consider that there is actually little evidence that fees are a deterrent to late payments.
Hilton Hotels & Resorts avoids levying late fees against customers who are late to check out because it doesnt want to tarnish its reputation and prevent it from providing a high level of customer service.
What can the apartment industry learn from Hilton? In Multifamily Insiders, Jason Velazquez asks property managers to imagine if Hilton Hotels opened an apartment community: I would wager that Hilton would quickly realize the opportunity of increasing long-term resident retention by hyper-focusing on resident experience and increasing goodwill.
Long-term residents could mean lower marketing and turnover expenditures, and a happier on-site team that isnt in conflict with residents over late fees.