Like most people, I started last year 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 … we all know what happened next.
Raging bushfires were closely followed by a global pandemic, and the world as we knew it was changed inextricably.
For those of us in the property management industry, it meant quickly adjusting how we run our businesses and manage our teams.
While not all businesses have been impacted in the same way, what I think we all can agree on is that we have needed to build our resilience to cope with unprecedented and challenging times.
As the demands on property management agencies increase, resilience is becoming more important than ever.
For some agencies, the impact 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, new technology to help with virtual inspections and maintenance, 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, or the business cost of servicing the agreement you have in place with your customer, to help drive growth and substantially improve your business’ bottom line.
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 of 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.
- Whether you have the right team in place for success.
From a trust accounting perspective, do you operate separate trust accounts or a single trust with your existing long-term rentals?
How do you report on the two areas of your business from a financial perspective and what software do 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.
In property management, being resilient is par for the course.
While COVID-19 has created continuing uncertainty as to how the markets and economies will fare, one thing is certain – there is no time like the present to start reimagining what you want the future of your agency to look like.