It’s hardly an industry secret that the rental market is hot right now, with economic trends and more stringent lending criteria seeing the great Australian home ownership dream make way for a more transient living experience. realestate.com.au’s Kul Singh explains the shift is resulting in rental searches outstripping sales in some areas. It’s also seeing rental properties in many suburbs spending fewer days on the market.
While that’s good news for owners and property managers, Kul also notes some interesting findings when it comes to how landlords select a property manager. And, surprisingly, it’s not all about the fees.
It might be one of their biggest financial investments, but owners take only a short time to research and select their property manager. The research indicates 63 per cent of landlords spend less than two weeks seeking out the right person to look after their property, and half go with the very first property manager they connect with.
“This was a surprise to us,” says Kul. “We always knew they spent a short amount of time researching, but the fact they go with the first one they connect with shows how important it is to brand yourself in the best possible way.
“Get yourself in front of as many eyeballs as you can but, more importantly, make an impression,” advises Kul.
It’s about the team
In real estate sales, selecting the right professional is all about the individual; but in property management realestate.com.au have found the opposite is true. When it comes to how landlords find a property manager, often they’re looking for a reputable brand.
Kul notes this means agencies should pay attention to their property management branding and the team behind it. In the future, realestate. com.au will be looking to assist in a similar way to the sales realm with the expansion of the Edge Series of products, which will be good news for property managers.
“The next part of our roadmap in terms of the Elevate and Edge products is to focus on property managers and agencies…we are working on how we brand property management teams, how long they have been working together, how many properties are being managed and leased, that sort of thing,” says Kul.
What property owners seek
When it comes to what landlords seek when they connect with a property manager, Kul notes it relates to three key things: tenants, payments and processes. These are the elements a BDM’s listing presentation should touch on and include:
- How the agency selects tenants
- How and when rent will be paid, and how you ensure tenants pay rent on time
- Your process for handling repairs and maintenance
- Your process for inspections and what they can expect
- How and when you communicate with landlords
“Those are key things that they’re looking for; when is rent paid, how is it paid, when do I get access to it, what’s the process you go through to find the best tenant?
“Additionally, they want an insight into your general process if something goes wrong from a maintenance perspective. They just want to understand your process and how you make it less painful to them.”
Get yourself in front of as many eyeballs as you can but, more importantly, make an impression.
The need for speed
Meanwhile, good communication and timeliness starts from the outset.
“It’s not rocket science,” says Kul, explaining that property managers should get in contact with new leads quickly in the knowledge landlords spend only a short time researching and tend to engage the first property managers they connect with.
It’s not all about the fees
Downward pressure on fees has been a major topic of discussion in the industry over recent months, but it’s just one factor in an owner’s decision-making process.
It also fails to register on the landlord satisfaction scale once they’ve selected an agency.
“When they are deciding [on a managing agent] it’s one of the top things owners will think about. Once they’ve picked a property manager or an agency they want to go with, fees are no longer in their top 10 key focus areas.
“It comes back to the service that the landlord wants: proactive communication and ongoing communication with them.”
Room for customisation
In the age of Uber and the ‘customer experience’, Kul notes there is also room for customisation in property management, especially when it comes to attracting landlords who might otherwise look to manage a property themselves.
“In the research we did, 49 per cent of the landlords said they prefer a customised offering, so not a one-size-fits-all.
“They might say, ‘I only want to pay for three things, which might be market my property, find me a tenant, and I will pay for add-on services like a routine inspection. I don’t want the eight per cent all-inclusive; I want the three per cent plus.’
“You’ll always have people who just want the all-inclusive ‘set and forget’, you’ll have others who are happy to do a bit of the heavy lifting themselves, and I think we need to respond to what the market wants. Some agencies are starting to move in that direction now.”
Meanwhile, he tips this as a major trend that will emerge over the coming year.
“You’ll probably see more agencies responding to the needs of investors and landlords, customising their offerings around property management.
“I think we fell into the trap of one-size-fits-all for too long, because it was easy, it was significant. But with digitising and being able to have more control as a consumer and as a landlord, I think customising what my needs are is going to become more apparent, and agencies will respond to it.”
realestate.com.au will release their full landlord research results over the coming months.
KUL’S TIPS TO SECURE RELATIONSHIPS WITH YOUR OWNERS
Kul says that ongoing communication is still a major factor for owners/investors, with 53 per cent of them expecting to be contacted monthly and a further expectation they will receive a response within one day of making an inquiry.
“When they’ve reached out to you, they expect a response within a day – which again is common sense, but it’s surprising how many people don’t call back within a day.”
Kul urges property management leaders and professionals to ask themselves:
- How often are you proactively contacting your landlords?
- What type of information are you sharing with your landlords?
- Do you have a clear schedule outlining the types of communication you share with your landlords?
“If an owner is not hearing from their property manager, it is likely they are not invested in the relationship. If all you do is get an invoice to say, ‘Here’s what happened in the last month and here are our fees, and here’s what you got paid in rent…’
“If you haven’t engaged, you haven’t built the social capital, and that’s what makes it easy for an owner to switch property managers.”
Fostering that engagement is easier than many property managers believe, Kul explains. It’s as simple as using available data and market insight to liven up standard communication like monthly statements.