Increasing Internal Efficiencies Helps NHA Manage Inflation (So Residents Don’t Get Stuck Carrying the Costs)

These are some tough times; you don’t need us to tell you that. But it’s worth considering the ripple effect of tough economic times on regular folks and smaller organizations, like our own - and our residents. 

Our organizational day-to-day and the earning power of our residents are weaved together. Their rents support our organization which supports other residents' rents and so on. It’s a cycle, an intricate and symbiotic relationship. And the economic pressures that are felt by one, are felt by the other. 

It would be patently unfair, unsustainable, and directly contradict our values as an organization to simply hike up rental rates along with the market, as some private landlords have been doing. That said, everything else we provide continues to increase at a rapid rate as well. Utilities to maintain our buildings are sky high (and subsidized for residents), wages must increase at least a basic minimum, the cost of insurance and benefits have risen dramatically in recent years, and even just the cost of contractors, materials, and fuel influences how lean the organization can run. 

In true transparency, NHA residents did recently see a rental increase, some as much as 10% (the max we would allow and including utilities surcharges). This was a really difficult decision to make, as NHA has been committed to minimizing rental increases over the years. 

But there are only so many efficiencies that can be found (and we’re going to talk about those in a minute, as they are impressive!). 

But to put the rental increase into perspective, we want to share what we’ve seen in the in the last 12-18 months alone: 

• Snow Removal is up by 10% 

• Utilities are up by 20% 

• Waste Removal is up by 20% 

• Insurance is up by 6% 

• Property Taxes are up by 10% 

• Contractors (plumbing, electric) are up by 8% 

• Replacement Parts are up by 11% 

So, we know prices are up and we know NHA values finding ways to keep rents as reasonable as possible.  

Let’s talk about where staff have worked diligently to find efficiencies and reduce organizational costs, working hard to maintain our buildings in these times: 

1. The maintenance team has standardized common replacement parts like toilets, paint, plumbing items like faucets, lighting etc. so when there’s a replacement needed, they have parts on hand to do repairs and replacements more quickly – without excess trips for supplies, fuel, or waiting for replacement parts to arrive. And they use a software system to track this inventory, too, so maintenance requests can be handled efficiently and effectively. 

2. They also proactively decided to replace nearly ALL of the in-unit water shutoffs in the buildings. This has decreased resident water loss when there’s an issue in one unit, and importantly, all but eliminates the likelihood of in-unit plumbing issues creating flooding that could affect someone else’s home (unit). 

3. Organizationally, we also started looking at where staff development could work to benefit both employees and the bottom line. We hired folks with more technical skills that meant we could hire contractors for less, saving us a significant amount per year, year over year, when considering how the “additional” tasks that used to be contracted out are now part of someone’s day-to-day deliverables. 

4. And we would be remiss not to mention the preventative measures we take to ensure long tenancies, which serves our community AND yes, saves NHA money, too. It starts by ensuring everyone understands our model and wants to live in our unique community. We welcome everyone into the buildings, providing a welcome package that contains information on everything from building upkeep to resident rules and regulations, and even what it means to be a good neighbor. We also know that when residents feel connected to their homes and share in the upkeep of our buildings, it’s better for all of us – and that includes the financial side of things. 

By utilizing in-house expertise, thinking a little differently about how we accomplish ongoing and even daily tasks, and improving our internal systems and structures, we have become more efficient and less reliant on outside sources and that is helping us mitigate some of the inflation being deeply felt across the country by everyone. 

Next month we’ll be sharing our recently completed Resident Wellness Study and what that means for both residents, staff, and the longer-term success of our organization.  Because as much as it would be simpler to focus on the dollars and numbers around inflation, it’s also important to NHA to keep an eye on the effects of these times on our residents’ wellness in every area of life.