New Years Resolutions for Property Management 2017
2016 has been a challenging year for many people working in Real Estate, especially for property management companies who are facing new and unique demands from tenants, and owners alike. As technology continues to churn the proverbial waters, and the demands set on the shoulders of property management companies change accordingly, it is crucial to find the time to set up goals for the coming year.
Fundamentally, this takes a certain level of self-evaluation, a pragmatic and realistic accounting of your capabilities and limitations, as well as a clear focus on a tangible goal. First and foremost, you must define your goals, in concrete, quantifiable terms. Otherwise you run the risk of chasing a goal which is always changing, and you will rob yourself of the satisfaction, and confidence boost which comes from achieving personal goals.
For example: If your goal is to be successful in Real Estate, you need to define what "successful in real estate" means to you. Instead of establishing an abstract, subjective goal such as, "success", set concrete markers for your goals. "I want to increase the number of properties I manage by 20% over the next year". This is a much more concise goal; one with which you can track your ongoing progress, and adjust accordingly.
If your goals in the coming year involve property management, then these 5 new years resolutions can set the stage for you to push forward and achieve your 2017 ambitions.
1. Stop Being Stubborn, Let Technology Help
We get it: there is a certain appeal to doing things the old, "brick-and mortar" way. The long and tedious process to manually document, file, and keep track of all of the necessary paperwork that goes along with running a legitimate property management company still appeals to many property managers out there. It is what most of us are used to- and for any industry; change is hard to come by. However, if your tenants are still filling out maintenance request forms and dropping them at your office, or if you find yourself going to the bank countless times a day to deposit checks, then you are robbing yourself of precious man hours which can be better invested into promoting your company or acquiring new clients and tenants.
Technology is not "All or Nothing"
One of the beautiful aspects of technology integration, is that it is not an "all or nothing" endeavor. For those property managers who may be less tech savvy, start small, work your way up. Simple changes can have the most dramatic effects. Perhaps you're not ready to make a switch to a cloud-based property management system, and that's fine, but consider making a change to your website that allows people to pay rent online directly to your bank account. Or have a small section added to your website where tenants can fill out a maintenance form, which will be sent to your email address.
Think The Technology You Already Use is Efficient?
It very well may be; but with new apps and software coming out in a constant and endless flow of improvement and upgrades; it is more likely that the super expensive, property management software you're using now has become a relic in the last year. Technology is always finding ways to be more efficient, offer more features, and automate services for you. By not looking at what's out there on an annual basis, you may miss out on software that could mean even faster, even cheaper ways to run your business.
Tenants, Property Owners, and everyone else in between have come to expect a certain level of ease when interacting with businesses. This ease of use is almost always directly related to the technology a company uses for its customers.
For example, let's say a tenant has the choice between doing business with your company (comapny A), and another company (company B). Paying rent with company A means going to a physical bank to get a money order, then dropping it off in a deposit box at an office. Paying rent with company B means clicking a button or setting up automatic payments. Chances are, they will go with company B, and you will lose out on that business to a competitor. It is worth the extra effort to accommodate the needs of the market; that is... if you want to be successful and remain competitive.
2. Evaluate Vendor Relationships Annually
Much like technology, it is easy to fall into the habit of expecting less than stellar service, simply because it is just what you have always done. Or the incredibly high stress level already associated with trying to run and establish a successful property management company , is enough as is - without the added stress of trying to find new vendors and making the switch.
This is why making time, at least once a year, to really look back at your relationships with vendors over the last year is so important. Looking at the year cumulatively allows you to evaluate whether or not their services are a good investment of your time and money. You may have been using the same carpet installers for 10 years, but if the last year has been filled with problem after problem, or has come with big increases in cost of service, or work isn't being completed in a way or timeframe that you find acceptable, then perhaps its time to make the witch. Maybe the stress of switching to a new vendor is worth what you will save in time, stress, and having to have projects done over again.
It can be difficult to see the big picture sometimes. This is especially true in businesses such as property management, which are run on more of a day-to-day basis. Sometimes we only notice the individual issues we have with any specific vendor, and fail to recognize that over-time those little missteps add up to a much larger problem which can be draining your company. Taking time to look back over the year cumulatively will help to streamline your business, and relieve stress.
3. Price Compare for Your Standard Utilities
One gaping hole in the side of most property management companies is the lack of annual price comparison. The price we pay for the daily utilities essential to operations end up like background noise. They slip between the cracks, and can be a substantial opportunity to cut your operating costs.
For example, let's say you pay a certain company that delivers the large water bottles for your company water cooler. Is their service the cheapest in town? When was the last time you checked? The same goes with property insurance companies, internet service providers, copy and printing services, IT services, cleaning services, phone service providers, and more.
We are all guilty of going too far in between shopping around for the best deals we can get on these daily-use services; so establish a time to spend a couple hours calling around to get quotes from the companies which make running your own possible. You may be surprised at how much this simple step can help to reduce your operating cost over time. And who doesn't like saving money?
4. Learn to Delegate
This is likely the hardest thing for anyone who has grown a business to do. Part of the reason that certain people are successful is because they didn't listen to other people, and forged their own path, followed their own gut, and made ALL of the decisions. "If you want something done right, do it yourself" is a common mantra among successful entrepreneurs, and with good reason. However, there comes a point at which you, as a property manager must realize that a failure to effectively delegate tasks will not only impose detrimental levels of stress to you on a personal level; eventually this lack of delegation is going to greatly limit the growth of your company, slow down your work flow in exponential ways, and pose a substantial risk to the stability of your employees.
Your Business Should Rely on Clear Procedure, not Specific people
There are two ways in which a company can operate: Reliance on People, and reliance on procedure
Reliance on people: this model means that in order for your company to be efficient and successful, it relies on specific people. Would you be comfortable leaving your company for a month? Would the essential functions which are required for your company to operate successfully still continue without you, specifically?
For many small business owners, the answer to the above is a resounding NO. Why? because in order for their business' to run, there is a reliance on a certain person, or group of people to function.
Reliance on Procedure: in these situations, the crucial knowledge, know-how, procedure, and protocol are clearly laid out in ways that can be understood by employees. Employees know what their job is, and how to do it, and there are resources such as operations manuals, or reference guides that explain what to do in any given situation. The intricate workings of HOW to run your company are documented in such a way that if you were to take a leave of absence, your team would be able to manage essential functions and continue without having to stop and check or verify every action before doing it.
Why this matters
Allowing the success or failure of your company to depend on one person, or a small group of people is risky business. Things happen, lives change, people pass away, move, get married, change careers... and if one of those people on which your company relies (including you) falls ill, or has a major life change, then it puts the entire company, and the financial stability of employees at risk.
Additionally, trying to wear too many hats is going to take away from crucial time to pay attention to the part of your business which should be acquiring new clients and investors. As a property manager, if you are spending a substantial amount of your time dealing with the little details, then you are missing out on the big picture, and missing out on opportunity to get out there and show your company to investors and potential clients. You have to be able to let go, trust your managers to be able to handle the details, and give yourself the time and space to invest in growing your company or your brand.
You don't want to let go of that control. You got to where you are because you know the right way to do things. Understandable. However, there comes a point at which no matter how good you are a juggling responsibilities, things will slip through the cracks, you can damage relationships with clients and investors, and over all, your company as a whole.
Make delegating tasks a priority in 2017. You will be surprised at how much more efficient and focused you are when you don't have to sweat every little detail.
5. Spend Real Money on REAL Renovations and Upgrades
No one likes to do it. It is hard to part with tens of thousands of dollars knowing you will get that money back in tiny increments over an extended period of time. However, one of the biggest impediments to property management in regards to tenant retention and vacancies is the appearance of their rental units. The little band-aid fixes done here and there to deal with issues are good, but eventually, you will have to recognize that people are picky, and vain, and looks matter a lot. Go into your rental units, look around, and ask yourself if you would live there, especially at the price at which you are asking. Would you? If not, why not? Chances are your potential tenants are thinking those exact same things, and they end up signing a lease elsewhere on the simple basis of a newer coat of paint or energy efficient appliances. Do some research on your competitors. Go to an open house or two in the neighborhood of your rental unit and see what other property managers are offering for the same price you are, and try to see it from a tenant perspective. Who would you choose?
Tenants are demanding. If you find your properties regularly vacant, or can't seem to get the fair market rent for your rental unit, chances are - you have an aesthetics problem. Dedicate funds in 2017 to real renovations. Even if it is as simple as replacing all the AC units in your buildings; the difference a simple change can make on your rent rates, and vacancies is substantial.
Talk to your property owners. More often than not, if they are trusting you and your company to run their building, they will at least be open to hearing you pitch why an investment in renovations would be beneficial to them.
Take Some of the Burden Off Your Shoulders, and Commit to Making Changes in 2017
Changing isn't easy. Then again, what worth doing ever was? Take some time this year to find ways to streamline your business, and you can cut costs in some unexpected ways. Train your team, and learn to rely on them for the daily operation of your business so that you can focus on expanding your horizons. Make sure that you are getting the best prices for the services your company uses every day, and take time to look at the relationships you have with your vendors to make sure that you are making wise investments and getting the service at a quality you expect. Invest in your properties, keep an open line of communication open with property owners. Make a change, and consider these 5 new years resolutions for successful property management in 2017