How to effectively monitor your property management business
Effective leaders keep their finger on the pulse of their business. We like to call this ‘Pulse Leadership’ since you continually check your business’ vital signs. Doing this empowers you to know when your business is healthy or when an element needs repair. If you want to be a Pulse Leader and keep your property management business healthy, here are the top vital signs you need to monitor.
Vital Sign 1. Arrears
Pulse Leaders keep their finger on the pulse of their property management business’ arrears. Their goal is to keep arrears at 0% by managing high-risk tenants, so they don’t become ‘arrears tenants’. Pulse Leaders know that if their business is experiencing tenants with ongoing arrears, this is a sign that repair is immediately needed to avoid losing management. Monitoring arrears, including proactively managing tenants who may pose a risk, is how Pulse Leaders ensure their business remains healthy.
Vital Sign 2. Tenancy expiry
Pulse Leaders continually monitor tenancy expiry. They know that a high percentage of tenancy terms due to expire in the same month can dramatically increase their team’s workload as they must negotiate more new tenancy terms and vacates. Quite often, this can lead to other vital signs being neglected. That’s why Pulse Leaders make sure they know the number of tenancy terms expiring each month to ensure there is always an even spread of expiries versus workload. By closely monitoring tenancy expiry they can help maintain their business’ health.
Vital Sign 3. Tenancy terms
Pulse Leaders also monitor tenancy terms. Keeping their finger on the pulse of tenancy terms can optimise their team’s workload. Unlike some agencies which prefer to implement 6-month tenancy terms in case tenants breach their agreement, Pulse Leaders ensure that their property managers implement minimum 12-month tenancy terms. They know that this increases productivity as it halves the time spent on tenancy renewals. What’s more, they know that if tenants ever breach their agreement, they can be terminated regardless of the term. By monitoring this vital sign, Pulse Leaders can maintain a healthier workload for their team.
Vital Sign 4. Average income
Pulse Leaders always check their average income. They know the importance of monitoring their business’ various income streams and knowing their average income each month. That’s because, if their average income decreases in any given month, they can more easily identify where and when a change occurred, such as management fees being reduced, and implement repairs where necessary. By keeping their finger on the pulse of their average income, Pulse Leaders ensure their business is always achieving optimal income.
Vital Sign 5. Incoming calls and emails
Pulse Leaders constantly measure the number of incoming calls and emails to their business. They know that a high percentage of incoming calls and emails signals a reactive communication style. In this instance, clients contact an agency seeking information because they are not being kept informed. Reactive communication minimises productivity, increases operating costs, and often leads to client loss. That’s why, Pulse Leaders implement a proactive communication style and maintain a 20% incoming, 80% outgoing split. They know that a healthy property management business is one that proactively manages communication.
Vital Sign 6. Productivity
What’s more, Pulse Leaders continually monitor their team’s overall productivity. Quite often, business owners measure productivity on whether their team is ‘busy’. But Pulse Leaders know that busy does not always equate to income-producing efficiency. Instead, they measure productivity against the number of tasks completed and the time taken to complete those tasks. By keeping their finger on the pulse of their team’s productivity, they can easily detect the difference between busy and productive and, in doing so, ensure that their property management business does not just remain healthy but thrives.
Jo-Anne Oliveri, CIPS, TRC, Founder and Managing Director of property management business solutions company ireviloution is an international real estate identity who has trained over 500 agencies and thousands of agency owners and property managers worldwide. With almost 30 years’ real estate experience, she is seen as a leading authority on all things property management and regularly speaks at the industry’s top Australian and North American conferences. As well, she was selected as an Industry Thought Leader of the Year finalist for the 2015, 2016 and 2017 and 2019 Real Estate Business Awards and Industry Influencer for the 2017 Elite Agent Awards.