How Property Management is Changing in 2020
This year in 2020, a good one, we’ll see property managers in the US, UK, Australia, Canada and Germany adopt more simplification, more responsive tenant services, and better accounting and financial management for owners.
And yes, property management software is central to orchestrating workflow, automating payments and accounting processes for small business landlords and multifamily managers. Tech and customer orientation are in for 2020.
Trends Will Become more Visible
It takes time to understand where property management is headed and how tech fits in. 2020 may be the year where trends show themselves in the real work of property managers and landlords. See our post on trends in property management and our state of property management industry report for data.
Property management pros are familiarizing themselves with new tech tools, and this will reduce confusion and the hype. Simplicity is what will drive real innovation in the workplace and tech is central to that.
Being More Profitable When Revenues are Falling
Do it yourself, SMB landlords have the same goals as multifamily apartment landlords — be more profitable when revenues are falling. To regain profitability, we need to ease workloads and add more value.
A New Definition of Property Management
It’s important to redefine your work and role heading into the new year because you need better results. If we keep referencing old definitions of property management, we’re not doing ourselves a favor. Everyone is going through this same shift toward tech and customer orientation.
We should start exclusively with a new definition of property management:
Definition: Property management is the use of technology to create profitable operations, powerful controls, and executive level oversight of real property by creating ideal experiences for tenants and landlords.
This definition respects the growing customer-focus on landlord and tenant experience, away from tasks and responsibilities. When customers comes first the real work and solutions become clear.
PropTech is Making Property Management Easier
The influx of technology, intense rental housing demand, housing shortages, new business models, low interest rates, bank lending embargos, government regulations, new types of properties, along with the increasing complexities of the real estate market, means property management as a business has to be simpler and more effective.
These trends and developments are skewing the definition of property management as more of a virtual service. The technology we speak of frequently on ManageCasa (iOT, rent payment systems, cloud software, 5G, etc.) is ready to create more automation and extend virtual property management services.
Exciting new ways to raise revenue, ease workloads, and give tenants what they ideally want in their rental accommodations comes from new property management tools. Those who hang onto to old manual tools and traditional definitions of their property management work will find the going tough in the coming years.
Looking Forward to 2020 and Beyond
Although it might be stressful to look forward to 2020 and beyond, the proptech tools available make your work easier and give landlords what they demand — profitability and good asset and tenant management.
A big hurdle for property managers is that they don’t understand the new technology and how to fit it in. As they become more stressed with reductions in budgets and operating margins, along with new tenant demands, they’re less able to think clearly about the course to set for their property management companies.
And falling cap rates, lack of affordable rental units, tenant’s on demand expectations, landlord expectations of cost efficiency amidst regulation, and reduced trained staff availability are constant pressures for firms from California to Hawaii to Colorado and Florida.
Managing with Fewer Staff
75% of property management firms today have less than 6 staff members. As companies take on more rental units, it’s easy to see a crisis brewing. As older property pros retire or leave due to stress, companies must find and train their replacements.
And according to NARPM surveys, property management firms are offering more labor intensive services including rent collection, lease management, marketing services, inspections, evictions, cleaning and accounting services.
Firms are also into more financial reporting and advice, property sales, renovation, insurance, and outdoor services.
Your competitors are offering increased services at lower prices only because they’re using the new property management software solutions available. That’s what is generating this evolution in the property management sector.
7 Tips to Make your 2020 an Excellent Year
- pay attention to owners — make them happier by progressing, increasing efficiency, improving your own business model, and providing helpful financial information they need.
- improve your tenant’s living experience — anticipate their concerns, make them happy by being more responsive, communicating well, and offer the services they wish for.
- improve your marketing and grow — from sourcing new owner/tenant leads from high quality locations, writing rental ads professionally, and developing a great property management website
- review and upgrade your software — summon the optimism to adopt more powerful, but dedicated software solutions that easy to learn and use.
- explore new services – do your research on all technology related improvements you can initiate to appeal to today’s renters
- improve tenant screening – use intelligent tenant screening sources and social media avenues responsibly
- focus on success – grow, become more efficient with technology, do your marketing smartly and profit will take care of itself
Lower Revenues Are a Worry
In the latest NARPM survey, property managers are reporting slightly lower revenue each of the last few years. Many want to grow their portfolio to regain that revenue, but they may not be looking to new types of revenue streams presented by new property technology.
Property managers are fighters. More are reporting having to fight hard to stay competitive and manage within budgets. As we reported, property managers top goals are Growth, Efficiency and Profitability. This year, keeping their landlords happy is a new priority.
Communication and Leadership
This touches on how the role is changing from micromanagement to communicator. It’s software that’s bringing new ways to communicate to tenants and owners. Owners want better more actionable information/reporting and they’re frustrated by poor accounting and financial reporting. They’ve got too much on the line to be in the dark.
More than ever, property managers have to match up landlord/investor expectations to the new demands of today’s tenants. Tenants want modern solutions. Word gets around about who is tenant and tech friendly. And it’s the demands of young tech savvy Millennials that will accelerate changes in 2020.
Make 2020 your year of revenue acceleration and client growth. Choose ManageCasa for its ease of learning, tenant communications, and dedicated, specialized services for landlords and property managers.