30 Days of 3.0 – Day 4: Turnovers
Welcome to Day 4 in our “30 Days of 3.0” series. Yesterday we talked about how the new “Standard Term” field gives you more control over the rental patterns we generate. Today, we’re going to talk about something most of our competitors can’t account for, Turnovers, and how we’ve made them even better.
In prior versions of AdvancedREI, our algorithm just built up a large group of “month” definitions that we applied different values to, and was only able to apply turnover costs to “months” marked vacant. In our original thinking 4 years ago, we wanted a way to be able to model the same tenant having their rent increased ever year, but not vacating.
So the easy way to do this was to set the “Months Vacant” to zero. But the problem was, you then had no idea whether a change in rent was due to a rental increase, or a turnover. This had an unfortunate side effect of never letting you apply turnovers when the vacancy was less than a month.
So when we re-wrote the Financial Engine, we gave it specific knowledge of the concept of a Lease, and our system now generates these Lease objects internally when building out the rental pattern. Because we now track each discreet lease, instead of just a group of leased months, his allows us to apply turnover costs to each Lease, regardless of the vacancies between leases.
So how did we handle rental increases under this new pattern? You’ll just have to wait until tomorrow to find out. I’ll see you then, and I hope you have a fantastic day! :)