WHEN IT COMES TO INCREASING income into property management departments, the industry can be its own worst enemy. Often sales-focused principals apply a volume mentality to their rent roll asset, chasing relentless growth because they believe bigger rent rolls are the only way of increasing their overall bottom line. But a focus on value-adding could be a better way to amplify revenue, explains Natalie Hastings.
ACROSS AUSTRALIA, I’ve spent time mentoring principals, BDMs and property managers to capitalise upon the asset they’ve already got, rather than becoming fixated on volume growth alone. As any property manager who has experienced a stint in a low-fee, high-volume agency will attest, the costs of staff turnover, stress and potential legal skirmishes far outweigh the value of any additional listings.
The costs of staff turnover, stress and potential legal skirmishes far outweigh the value of any additional listings.
Some principals make the mistake of offering ridiculously low management fees, or even ‘three months free’ promotions in their wild pursuit of revenue. If you drive down any high street across the nation, you’ll see property management marketing with one message only: cheap fees, list here.
As a profession, we’ve got to change the discussion within our agencies about the value of expert property management, so that our external marketing reflects the quality and import of our specialist skills. Next time you’re asked to focus on bringing more revenue into your department, think more holistically about revenue and consider these four simple ways to enhance your income – no discounts about it!
So many real estate businesses lose money because their database is out of date, or their team are poorly acquainted with their property management software. A database tune-up is a great way to bring more money into your real estate agency immediately: it’s just a matter of carefully ensuring that all fees (even the teeny tiny ones like statement fees) are being charged to all landlords. If you’ve bought rent rolls or switched databases, fees and charges can fall victim to data transfers. Across a rent roll of 700 properties, an additional $2.00 per landlord per month adds substantial revenue to your business.
SOCIAL MEDIA MARKETING
Whilst social media marketing is slowly making its way onto vendor-paid marketing schedules, it is still relatively under-utilised for property management listings. Developing a social media marketing strategy unique to landlords serves two purposes.
Firstly, it allows you to prospect the market with a genuinely innovative offering. Instead of ‘three months free’ posters, you’ll be able to show your ingenuity with social media marketing packages, attracting the right tenant to your landlord’s property. Even the most curmudgeonly landlord will acknowledge the value tailored marketing will bring to securing a great tenant for their investment, reducing their days on market.
Secondly, social media marketing is a skilled service offering you will be able to charge an additional fee for. Of course, your property managers or administrators will need to be upskilled to provide this tailored social media marketing solution – but once a plan is in place, you’ll enjoy better outcomes for your landlords and better monthly bottom lines. Win-win!
WHERE ARE YOU UNDERVALUING YOUR TIME?
In my experience, there are activities across each property manager’s week which are either undervalued monetarily or completely ignored as a chargeable service. Identify where these potential ‘value-adding’ items lie by inviting your property managers to share activities across their week which are costly in time, yet minimally (or totally!) uncharged to the client.
There are activities across each property manager’s week which are either undervalued or completely ignored as a chargeable service.
This process will help you better charge for time-costly activities, like printing off multiple documents for a landlord’s tax agent or sourcing appliances for a property, and perhaps even institute new services, such as an annual property management portfolio audit for landlords. The better you can clarify your services and expertise, the more easily you can differentiate your property management business in listing presentations and marketing drives.
WHAT ELSE CAN YOU OFFER?
Beyond sheer volume, there are many ways to enhance the revenue earned by your property management department. You might consider paid education evenings for landlords on Airbnb best practice. You could extend this into an Airbnb management offering, inviting a whole new demographic of potential landlords (and revenue streams) into your business. Perhaps you could offer mini-makeovers project management for bathrooms and kitchens in collaboration with your favourite trades. Think big, and don’t be afraid to look beyond the parameters of traditional property management!