A New Definition of Property Management
Yet the winds of change are bringing in new technology, economic volatility, government regulation, tenant expectations, and entrepreneurial factors are changing the answer to what is property management.
What’s being rented, by whom, for what price, how it’s being paid for and what services are being rendered seems to be up in the air. Yes, and in the chaos is opportunity for those with the tools to provide those new services in a more efficient, and tenant-friendly manner.
Today, we’re taking a new look at what a property management professional does and how software and the market is changing their work. We want to focus on the profit opportunities of tomorrow.
Industry stats show the economy will explode the market for renting and rental management in the next 5 years. The old definition of property management does nothing to help us understand or build excitement about the future of this business.
An Outdated Definition
The current definition is the management of buildings, administration, hiring, supervision, and maintenance services leaves little room for imagination, innovation and scaling up, at a time when we need to. That makes property managers more of a commodity.
The usual business model of setting fees, raising rent, and minimizing service is about to expire. The why, who, where, when, what and how of property management are changing because they can. Becoming that special, leading brand with new in-demand services is what we write about here on the ManageCasa blog. Our property management software platform is the foundation for it.
A Property Management Business with a Future
For any college grad looking for a job in property management, launch a long career or your own property management company, it’s better to look at what property management is broadly becoming – a process of renting and servicing anything that is rentable and then adding value in high margin services.
Which real estate or property type will be most profitable? Or are these just commodities that won’t produce the desired ROI? Entrepreneurs are looking down the road at the infinite possibilities of what an enterprising property manager could do to build revenue. This is only a brief introduction.
Let’s redefine the management of property in a series of learning steps:
- Definition and Roles
- Workflow Processes
- Profitable Rental Assets
- Tech Automation, new services, iOT, and expertise
1. Property Management Defined
The Business Dictionary defines it as the process of managing property that is available for lease by maintaining and handling all the day-to-day activities that are centered around the piece of real estate.
The standard definition is about the day to day management of real property — a task and not the outcome.
What does a property manager do now and where will they work? How many properties and renters can a manager handle? Who is hired to do maintenance and repairs? How does a property manager get paid? With margins falling, how will property management companies stay in business?
Check out some companies in Hawaii, California, Arizona, Florida and Illinois and get a feel about their business models and services offered. Could a property manager rent out additional assets, services, and offer expertise to grow profit? Could low profit maintenance services be outsourced and other more profitable service niches be focused upon?
2. Workflow Processes: Pen and Paper to Automated Services
We’ve progressed from paper and pen to online property management software to cloud-based mobile solutions to digital services as amenities. Now we’re managing the books professionally, collecting rent effortlessly, giving owners incredible insights and profit, while making tenants feel like royalty. We’ve removed the friction in one of the oldest industries.
Enter automated solutions and there are no limits on customers or properties. Just consistent cash flow and improved profit margins. Manage thousands of doors instead of hundreds and add on services. It’s doable and this is the future.
New automated services help to keep renters as loyal tenants too. Tenants actually demand these new digital services amenities.
3. We’re Entering the Non-Ownership Era
Property assets are very expensive for a number of reasons including demand, scarcity, taxes and regulations. And as mortgage rates begin to climb and inflation raises construction costs, many Americans, Brits, Germans, Canadians and Aussies will be unable to purchase a single-family house.
Demand for asset rentals will then be strong in the years ahead as we move into a rental culture across the world.
More people will rent everything from furniture to appliances, to condos and automobiles, to Internet connections and streaming entertainment subscriptions, wash their clothes in rented clothes washers. And they’ll park their rented electric cars in rented parking spots in rented garages, where they’ll pay for electrical recharge.
Millennials are already avoiding buying condos, cars, and furniture. With their wages, they never will own. Renting is a way of life they’re getting comfortable with because entrepreneurs are offering everything rentable. It’s cheaper and resonates with renters needs.
Those who own cars, condos, and boats will only own because they can rent them out. They do it for the amazing profit.
4. Types of Assets are Increasing
As the variety of rental asset types and real estate types grow, owners will expect property managers to manage them all efficiently using modern online solutions (software). And they’re looking for expertise in maintenance operations and customer service. They’re also expecting management skills in marketing, finance, and customer relations.
New software tools allow exciting new value added business models and pricing strategies. We’re escaping escape old pricing and service delivery models that handcuffed managers. Airbnb, Uber, Uber eats, and WASH are just a few examples of the new rental world.
If people are avoiding the property management industry, it’s because they’re influenced by out of date definitions that do make profitability unlikely. Automation, new services, and mobile management gives property managers new angles to make money.
And these aren’t gimmicks. We’ve noted in previous blog posts about new advancing technology and how high tech services are increasingly important to renters. The value landlords and property managers are delivering is changing. It’s more toward experience, services, and value, rather than a place for an overworked, underpaid renter to crash.
5. Automation, 5G, and iOT, and Expertise
The last step is all about automating services, extending digital services, better asset management with iOT sensors, and then selling business expertise to make much more income.
Adopting property management software is the first step. It automates tenant screening and leasing, marketing, rent payment, maintenance work, asset tracking, bookkeeping, and tenant communications. All the time consuming work simplified.
With iOT, all rented assets can be tracked and used to add services and value to tenants. From appliances to smart home controls and security features to energy usage, all hard asset management is simplified.
It’s an army of virtual, electronic eyeballs and trackers to give property managers and owners new ways to make money. The pay per use and micropayment universe has already arrived. And these will be in demand services renters can’t do without.
And 5G is a digital superhighway that will open up entertainment and communications service opportunities.
With all of this new technology and profit tools at hand, landlords will need expert managers to take care of it all.
That’s far beyond knocking on doors asking for cash from a renter!
Whatever you rent, it’s how you rent that creates your profit. Don’t forget to review, compare, and evaluate the features and benefits of ManageCasa and see why investors prefer this powerful yet affordable solution.
A Career in Property Management? Yes!
If you’re someone considering property management as a career, and you’re okay with digital tech, you’ll be happy with the salaries, job opportunities and demand for property management professionals.
From build to rent housing, parking spaces, to storage lockers and marina yacht slips, the opportunity to make money has never been better.
Why would a landlord, investor or property manager limit themselves to monthly apartment rental as their sole source of income?
See also: Property Management | Benefits of Hiring Property Manager | Property Management Solution Demo | Landlord Apps | Apartment Management | Lease Management | Property Maintenance | Property Management Apps | Rental Property Market US | Property Management Companies | Tenant Screening | Career in Property Management | Job Outlook |