I like most people started the year out thinking positively about what was ahead of me. I had just become a father for the first time, freely gloating about how great a sleeper my daughter was (trust me parents of newborns understand why this is a big deal!) and enjoying a well-earned break from work. And then…. well, we all know what happened, the bushfires followed by a pandemic. The world as we knew has been changed inextricably.
For us in the property management industry, it meant quickly adjusting to how we run our businesses and manage our teams. With the help of property management solutions, most were able to adapt to sudden challenges. And, while all businesses have not been impacted in the same way, we can all agree that we need to build up our resilience muscle to cope with what we all recognise as unprecedented and challenging times.
As the demands on property management agencies increases, resilience is becoming more important than ever
For some agencies the impact of COVID-19 has seen higher vacancy rates, rents being dropped to match demand, dealing with financially stressed tenants and landlords and having to fast track digital transformation projects, all the while keeping teams from burning out and businesses afloat.
There have also been some silver linings including offering better work flexibility, technologies to help with virtual inspections, maintenance, tenant communications, etc and a chance to rethink and review top and bottom-line business models.
Previously I spoke about the value of understanding your cost-to-serve i.e. the business cost of servicing the agreement you have in place with your customer to help drive growth and substantially improve your business’s bottom line. Data play an important role in cost to serve. By taking the time to set up reporting or investing in business analytic tools, these pieces of information can be further analysed and help you build a resilient business.
In addition to understanding your cost to serve do you also have a revenue growth strategy?
Diversifying your revenue streams from long term rental to include short-term particularly in inner-city and coastal markets, Airbnb services, holiday letting or taking on other property-management-adjacent services and partnerships are just some of the options in how you can boost your top line.
But before you start updating your service listing to include short term rentals be sure to consider the following:
- Rent roll asset valuation and any potential impacts
- Cost/benefit analysis in improving your profitability
- Do you have the right team in place for success?
And from a trust accounting perspective, do you operate separate trust account or a single trust with your existing long-term rentals? How you report on the two areas of your business from a financial perspective and what software you use to ensure compliance with your state legislative bodies and your licensing requirements.
Being able to create new opportunities for your existing and potential landlords can open the door to more interaction with customers and potentially enhance your business success.
At MRI Software, we take pride in providing the flexibility to work within an open and connected platform with our Partner Connect program. Not only do you get the freedom to choose which industry-leading integration you want to partner your agency with but in some instances the opportunity to gain competitive and flexible commission fees.
One of our many Partner Connect members is class-leading utilities connections company Direct Connect, who offer a fully integrated solution that can bring in easier referrals and higher conversion rates for your agency. Not only is it a pretty convenient way for your tenants to hook up everything they need when moving into their new home, but the real benefit is also the free value-add and service to your agency, that again can contribute to your top line.
In property management being resilient is just par for the course, and while COVID-19 has created continuing uncertainty as to how the markets and economies will fare, one this is for certain – there is no time like the present to start reimaging what you want the future of your agency to look like.