What is a common belief among property owners about maintaining occupancy versus raising rents?

Property owners often prioritize maintaining a high occupancy rate because steady, reliable rental income is crucial for the financial health of their investments. The belief that 100% occupancy is better than increasing rent stems from the understanding that while raising rents might provide higher short-term revenue, it can lead to vacancies if tenants decide to leave due to the increased cost.

Maintaining full occupancy ensures consistent cash flow, which allows property owners to cover ongoing expenses such as maintenance, management fees, and mortgage payments. The risks associated with vacancies, which can include lost income and potential costs related to marketing the property to attract new tenants, reinforce the idea that having tenants in place—even at a lower rent—is more advantageous than having units empty.

In contrast, while it might seem logical that higher rents could attract tenants willing to pay more, it often results in higher turnover and vacancies, particularly if tenants cannot afford the increased rates. Therefore, preserving occupancy by keeping rents at a competitive level is typically seen as a more stable and sustainable approach.