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Property Management – An Intelligent Strategy for Realtors
This situation is being resolved as we speak. As mentioned in the post on the future of real estate sales, a number of trends are driving big changes in this industry. Those changes mean rental property management might be a key service for you or your brokerage.
Real estate agents have to expand on their revenue opportunities, yet most are stumped about how to do it. As Sam Ovens, the New Zealand sales consulting guru says, you rarely succeed with your direct goals, but instead you get your big reward in other things on your route.
Fortunately, rental property management is an ideal way to connect with potential buyers and sellers. The rental housing market is huge and growing, and a lot of sales come out of rental properties. You probably have a few in your client list now and connecting with property investors is always a good idea. Maybe you’ve avoided and disregarded this business, but take a moment to see the potential.
What’s Driving the Housing Rental Market?
- the success of Airbnb and VRBO in providing hotel alternatives
- housing development restrictions
- high housing prices
- urban intensification strategies from governments
- young workers/professionals prefer being mobile and debt free
- young professionals want to work in urban/downtown neighborhoods
- young buyers can’t afford to buy
- home financing requirements are rising
- interest rates and mortgage rates are rising
- babyboomers selling their home and renting instead
- retirees moving to Florida, Texas, Arizona, and California to retire and rent
- passive rental income is lucrative and investors are building multifamily rental units
- a record number of small investors are able to buy units and rent them out
- immigration is strong in many countries
The demographics, financing, available stock, and new construction trends are favor sustainable rental market growth.
Leveraging the potential of the rental market is smart business. The tools available should help you do it. And what’s smarter than turning a negative into a positive for growing your pool of contacts and buyer/seller leads?
Disappearing Realtor Marketshare
If you’re an agent, and not a market leader with a team under you, you’re in trouble.
Just north of Toronto Canada, one Realtor is enjoying monumental success and dominating a housing market that is currently in decline. In fact, he’s growing a team of high quality agents and is winning significant market share.
With this domination, independent agents as well as agents with rival brands are seeing the market evaporate. The same thing has happened in Vancouver where Sutton Group’s Merrily Hackett has built a billion dollar real estate sales empire.
Even agents within well known broker brands such as Keller Williams, Coldwell Banker, Remax, and others are in jeopardy of being shut out. Brands mean very little in the new real estate market. The new value proposition has to do with more services delivered digitally — one stop shops with less time waste, complications and friction.
Many Realtors will have to move onto something new for employment. This is just the beginning as technology creates a tsunami of change in real estate.
Market Domination is a Smart Strategy
If you’ve thought of serious market leadership as a foolish dream, consider those are achieving it.
Mark Faris of Royal Lepage in Canada has gained impressive marketshare in one city and hasn’t missed a step in continuing to expand to other cities. The Faris signs are literally everywhere. It’s going viral in the real world. His brokerage is one to watch for 2019/2020.
He’s not going to tell you his sales and marketshare secrets, and team strategy, however he’s discovered something powerful. He hasn’t adopted property management services as yet, since he doesn’t need to. There’s nothing preventing any one of his team from picking up the rental property ball. Renting is big everywhere.
Marketshare has never been a big sales concept because we all believe local real estate is grassroots, person to person, and high maintenance. Very difficult for a brand to dominate and up until now it was silly talk. Yet the Faris Team is demonstrating how local marketshare is something to optimize and repeat.
And consider the oil barons and how they obsess about marketshare, over and above oil pricing. If there is a way to connect with a market and own it, it’s wise to do it.
The changes coming in real estate are well known. Technology can allow some agents/brokers to shut out competitors completely. And there’s no doubting intelligence which has become commonplace in North American culture.
Is it Faris’s Millennial thinking processes, big financing, aggressive sales techniques, or a reduced commission strategy? Is it better revenue sharing and prospecting in his firm? We don’t know and he’d be crazy to give anything away.
Lesson learned: go big or you’ll be out of business.
There’s no limits to success and when you create a big enough wake, everyone wants to get on board.
Property Management Opportunities
The rental property management sector is booming. With big new multifamily construction going on in Florida, California, and Australia, the pool of rentable properties is enormous. Given the high cost of homes and condos, a continuing NIMBY blockaid against growth, and a push to urban intensification of land use, people will be renting.
Although more people are buying homes lately, property rentals will sustain at high levels in most countries.
Nations will be renter nations. Rentals properties are improving too offering convenience, amenities, and views not available with ground level houses.
Traditionally, property management was a tough line of work. Face to face meetings with the landlords, tenants, contractors, along with paperwork and micromanagement. And there’s the spreadsheets and collecting rents.
The outlook for property management as a career is positive according to reports. Yet approaching it from the real estate sales angle brings commissions into the picture. A PM college graduate isn’t able to access Realtor® commissions and earnings.
It’s the arrival of proptech that’s changed the property management business. A wide array of entrepreneurs have built software to re-invent how property management is done, and how much can get done.
Online Property Management Software Solutions
What modern property management software for instance does is change business processes and ease workloads considerably. The onus to do the work is being shifted to smartphones, tenants, and contractors. To manage hundreds of properties cost-efficiently without traditional micromanagement tasks, you need task automation.
Property management apps shift the work to tenants and landlords. In many cases, they like the control, efficiency and communication power presented by these tech tools. Proptech is giving everyone what they really want.
This is what’s allowing property managers (and investors) to take on more properties. With rising portfolios of condos, apartments and houses, their profit is taking off.
So while property management was hard work before, it’s actually becoming easier. The rental property software being offered helps you manage everything with ease.
Take a look at ManageCasa, an online property management software solution designed for rental portfolios of 10 to 100 properties. You’ll see its benefits in accounting, online payments, lease document control, and tenant communications. You can read up on all the benefits on the ManageCasa website.
The bottom line for some capable Realtors looking for a bigger path to success, and one that’s sustainable through recessions, is that property management and proptech are the future. If you’re already doing some of this, then you’ve got a headstart.
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