The Smartest Budget Isn’t the Leanest: Rethinking Multifamily Spend for 2027
RealPage's Krista Hurley discusses 2027 budget planning with Pauline Houchens (Asset Living) and Bridget Liberty (Dayrise), exploring how multifamily operators should balance cost reduction with strategic investments in revenue, operations, and technology. The conversation emphasizes that the smartest budgets prioritize thoughtful planning over lean cuts, require property-level input, and need real-time visibility into spending to enable proactive decision-making rather than retroactive explanations.
Summary
The podcast addresses the challenge multifamily operators face in building effective budgets that balance cost pressures, market conditions, staffing constraints, and technology decisions. Pauline Houchens from Asset Living and Bridget Liberty from Dayrise share their budget planning approaches, revealing that both begin with revenue forecasting rather than expense cutting, starting around August by examining prior patterns and market conditions. They stress the importance of understanding macroeconomic signals, like Federal Reserve rate changes, before making assumptions.
Bridget identifies three key buckets for evaluating cost changes: whether operators can influence them, whether they're structural or temporary, and what the downside cost is of being wrong. Both leaders distinguish between necessary cuts, protective investments, and strategic spending. Bridget provides a concrete example where Dayrise protected or increased marketing spend in competitive markets facing new supply, instead of cutting blindly, while becoming more accountable about channel performance. The key was spending smarter, not necessarily more.
On market variance, Pauline explains that Asset Living uses multiple data sources and relies on local teams attending market outlooks to understand regional rent growth variations (ranging from 2% to 5%) before budgeting. Both emphasize making the budget a conversation with property teams rather than a top-down handoff, ensuring site-level managers can explain variances by understanding the drivers they actually influence.
A major gap both identify is between budgets and actual spending—invoices often go unmonitored, particularly during staff turnover, making it difficult to reconcile actual spend with budgets. They discuss how real-time visibility into committed spending (orders, contracts, upcoming invoices) would allow teams to make decisions mid-year rather than explaining variances after the fact. AI is presented as a tool to surface patterns across spending data, flag vendor trends, and identify lines drifting over plan, but only if it's constrained to provide fewer, better-targeted alerts that answer what happened, why it matters, and what action is available.
Bridget stresses that consistent data definitions and coding across properties is the foundational step before implementing any AI tool, as inconsistent coding prevents clear visibility regardless of technology sophistication. Both leaders conclude that thoughtful budgeting enables better forecasting, economic preparation, and shifts teams from reactive expense management to proactive spending discipline.
Key Insights
- Both Asset Living and Dayrise begin budget planning by forecasting revenue first rather than cutting expenses, with Pauline starting in August by examining patterns and market economic signals like Federal Reserve rate changes before making rent growth assumptions.
- Bridget identifies that spending decisions should be evaluated across three dimensions: whether operators can influence the cost, whether the change is structural or temporary, and what the actual downside cost is if the assumption proves wrong—and buffers are avoided because they prevent budgets from signaling actionable information.
- Pauline argues that the largest monitoring gap in multifamily budgeting occurs after invoices are received, particularly during staff turnover, where teams lose visibility into how actual spending reconciles with the budget, making it impossible to determine whether to add or reduce spend in future periods.
- Bridget demonstrates that protecting marketing spend in competitive markets facing new supply, while simultaneously increasing channel-level accountability, can preserve occupancy and rate in ways that save far more than the discretionary expense cutting would—suggesting the decision isn't about spending more but spending smarter.
- Bridget contends that consistent expense coding and categorization across properties is the foundational prerequisite before implementing AI tools, because without standardized definitions, multiple properties will code identical purchases differently, making any tool output untrustworthy and unclear regardless of technology sophistication.
Topics
Transcript
You're listening to a RealPage Podcast. Hello everyone and welcome to Multifamily Talks. I'm Krista Hurley, Industry Principal at RealPage, and today we're talking about a question every operator faces. Cutting costs may be easy, but building the right budget is so much harder. Cost pressure, uneven market conditions, staffing realities, and technology decisions all meet in the budget. So we'll talk about what to reduce, what to protect, and where strategic investment can strengthen the business and the resident experience. I'm glad to be joined today by Pauline Houchens from Asset Living and Bridget Liberty from Dayrise. Pauline and Bridget, welcome. Now, before we get into any numbers, I would love for each of you to introduce yourself and…
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