You Thought You Were a Property Manager, Didn’t You?
THREE YEARS AGO, you were employed by your agency to run a portfolio of 150 properties and had the title ‘Property Manager’ on your business card. As times have changed, many agencies have resorted to outsourcing their administration tasks. Lauren Kropp examines the effect has this had on the traditional PM role.
A few years ago, every lettings agency employed property managers to deal with the basic tasks of managing a portfolio of properties. Many people were looking to change this title to ‘asset manager’, ‘people manager’ or ‘counsellor’, but we still referred to it as property manager.
These tasks traditionally include:
- Lease renewals
- Application processing
- Reference checks
- Scheduling of inspections and sending appropriate forms
- Entering and arranging maintenance
- Compliance (smoke alarms, pool management)
- Arranging open homes, including uploading to websites.
- Sending lease documents and welcome packs
- Email liaising
- Client marketing
- Social media posts
- Trust accounting
Now many offices are outsourcing administrative tasks, what is left for the property manager? The only true gap that I see is routine inspections, leasing or viewings, and tenant and landlord sign ups for those who prefer face to face.
If an office were to hire or outsource a routine inspection officer, and a business development manager who could, in fact, perform the sign ups and viewings, this would make the role of the property manager obsolete.
I hear a lot of property managers complain that they do not get paid enough for the highly stressful job, and I concur.
If an agency appoints the outsource team and a BDM, what will happen to the current annual salary of a property manager?
If this were to happen, a principal has every right to greatly reduce the role and salary of a property manager, or make them redundant.
Everyone has an opinion on outsourcing. As the managing director of an outsourcing business specialising in trust accounting and temporary recruitment, I have spent a lot of time, especially of late, writing a ‘pros and cons’ list.
THE PRINCIPAL VIEW
A principal will love outsourcing if they do not have a strong relationship with their team and see them purely as an expense. That may sound harsh, but not all employers respect the employee and value the face-to-face concept of their input in the business.
By contracting the services of an offshore Virtual Assistant (VA), they only pay $7 per hour to perform the above tasks compared to $25 per hour for a regular employee. In some instances, they do not have to pay GST to the contracted worker as the company is owned and operated overseas. They do not have to pay super or work cover to the VA either.
However, they must make sure their professional indemnity insurance covers the VA. Based on a 38-hour work week, this is a cost saving of $684 in wages plus $65 in super – almost $39,000 annually! In a portfolio of 150 properties, the property manager will generally have an assistant or a routine inspection officer to assist them. Therefore, in the above instance, the property manager would be made redundant, the routine inspection officer would keep their job and the business would be better off by $39K – but what happens to customer service?
The principal who likes good old-fashioned customer service, face-to-face conversations and walk-ins will not like outsourcing. They can see the benefit of paying an additional $39K in wages because they have built a brand and a reputation. Therefore the business should be making up for that $39K and more with new management and growth.
One final negative in offshore outsourcing is the language barrier. The time spent initially outlining and training the VA in procedures and tasks is consuming.
But I can tell you from firsthand experience that, if you are fortunate to have a VA that fits your business mould, the initial training is worth it. We use a VA for our administration tasks, but she is restricted from calling our clients due to the language barrier.
THE PM VIEW
Property managers, however, will love outsourcing if it makes their life easier and they keep their job. Therefore, the type of outsourcing suitable for this is a routine inspection officer and/or a trust account specialist.
If the idea of a VA interests you but you are worried about the language barrier, it is possible to outsource to Australian companies.
However, you will pay more than $7 per hour due to Australian minimum clerical award; but this will assist the smaller offices who may only want a part-time employee to work from home. The training will also be much easier.
I have the best of both worlds.
I have a VA in the Philippines for our admin, and at Real Strategix we outsource Australian staff to perform inspections, provide in-office temporary recruitment and trust account outsourcing. Therefore my view is completely impartial.