Archive for 2010

Tenant Retention Should Be the Focus of Professional Property Managers

Monday, March 1st, 2010

I am sure with today’s economy many people think that it is more difficult to get a tenant to renew their lease.  Well this does not seem to be the case for those firms focusing on retention.  According to SatisFacts Research in a recent blog posting on a retention survey comparing 2009 to 2008, there is good news for property managers who focus on retention and taking care of tenants.  The survey highlights two questions, very likely to renew (1% increase over 2008) and not likely to renew (1.6% decrease over 2008).

However, the real interesting part of the article was the calculation of the cost of a move-out.   According to SatisFacts, the cost is $4,500 (due to increased concessions and vacancy loss days).  Their top performing clients were able to beat the 2008 index by 7 points.   If you do the math, even a small to medium sized portfolio can be greatly impacted by reducing move-outs.  For instance, if you have a portfolio of 200 apartment units or single family homes and reduce turnover by 7%, that would equate to 14 * $4,500 which gives a savings of $63,000 per year.

My blog, Does Good Property Management Matter, pointed out that by using low cost technology, a property manager can improve relationships with tenants, thus making them less likely to move-out due to frustration with the property.  It seems to me only logical to explore ways to have higher retention, particularly if the cost is reasonable.

There is no escaping the fact that the internet is the easiest and lowest cost way to stay in communication with your tenants.  By using a property management website to acquire the tenant and then using a resident portal to communicate with the tenant, you have leveraged the life-cycle costs of getting and keeping tenants.  Resident portals allow a tenant to submit property maintenance requests, check out property events, pay rent online, and more.

To investigate web based portals and determine the best approach to use for your operations, refer to my blog, Picking a Property Management Software Solution, or watch a brief overview of DIY’s property management websites.

So is focusing on retention important?  Only if you want to improve your NOI.
Rob Crichlow
DIY Real Estate Solutions

Posted in Property Management Tips, Real Estate Internet Trends | 7 Comments »

Qualities of a Good Residential Property Manager

Wednesday, February 17th, 2010

I was recently reading a LinkedIn Property Management Professionals Group forum posting on the qualities of a good property manager and thought it would be a good blog topic.  As I read the list, and it is quite a long list, I began to think, wow that would be an extraordinary person if they had every quality listed, though I would add integrity and honesty to the list.

But do any of us get measured in business by those qualities?  Yes and no.  If you had all of the qualities in the list and did not keep a property rented for an owner, would the owner give you good reviews?  I know a lot of successful real estate professionals that understand the ins and outs of building operations (keep the property in good repair and looking good) and know how to keep the property leased (understand how to advertise effectively and negotiate a win/win deal with the tenants), but do not know technology well.   Understanding the core of the business we are in is the essential ingredient for success in any field.

So what would my list look like if I wanted to find a good property manager?  Here are a few examples:

Property management industry knowledge - You would expect the property manager to understand the comparable rents in the area and know the direction rents were heading in the near to mid-term time frame.  He/she should be able to counsel the owner on what the rent should be in order to rent quickly and stay rented, while getting the highest rent possible for the property.

Understanding of how to keep a property well maintained – The property should be maintained to the standards set by the owner, for the appropriate cost for the area, and in a fashion that keeps the tenant happy.

You see, I believe in keeping your eye on the core business and not being distracted by the elements that other people are experts at.  A good property manager could outsource the things that do not apply to the core business.   Basic knowledge of things like contract law, accounting, and software should be required, but a lease can be reviewed by a lawyer, books can be maintained by an accountant, and software can be outsourced to a good property management software company.

The qualities that I, as a rental property management software provider, will be measured by must include a strong understanding of technology, since that is my core business.  The qualities that a property manager will be measured by will be a strong understanding of real estate.

So the answer to the question of how we are measured is very much yes and no.   A good property manager does need to have many of the qualities on the list, as all of us do.  But just as important if not more important is a strong understanding of the core business, managing properties.

Rob Crichlow
DIY Real Estate Solutions

Posted in Property Management Tips, Residential Property Industry | 1 Comment »

How is Online Advertising Spending Going to Affect Property Management?

Monday, February 1st, 2010

Borrell Associates have released their 2010 outlook for online advertising for real estate.  Rentbits has a reprint of several of the graphs and results in a recent blog posting.  The comparison of 2008 and 2009 historical data and 2010 forecasted data shows how online advertising dollars spent have dropped and will continue to drop in 2010.  What does this say for how property managers are going to keep their properties rented?

I suspect it shows how there will be a continued focus on how to leverage the dollars that are available to spend.  This will affect how people look at the costs of their approach to technology in all areas, including property management software and how it interfaces with online resident portals and property marketing sites.  What if you could use a property management software program that interfaced with multiple marketing websites, provided a powerful online portal for advertising your properties, and costs less to use on a monthly basis than what is in place now?   Shouldn’t the same commitment to cost management for ongoing expenses, like supplies and services, also be applied to the cost of using a property management system?

The Rentbits blog ends by saying, “…2010 is going to be a much bigger year for mobile and real estate applications.”  This tells me that 2010 will be the year for making sure that all costs for managing a rental property are examined, including technology.

I challenge you to research web based property management software programs and checkout pricing.  I believe you will find a program that offers a way to save money in how you are doing your advertising, while at the same time saving money on the cost of using the software.  Check out my blog on picking a property management solution or checkout our online rental property management software.

Rob Crichlow
DIY Real Estate Solutions

Posted in Property Management Tips, Residential Property Industry | 2 Comments »

Does Good Property Management Matter?

Monday, January 18th, 2010

Keeping a property looking good and the tenants happy is hard work for property managers.  And now with the internet, it has never been more important to focus on keeping good relationships with your residents.  A recent blog on Rent Bits indicates that people are beginning to use reviews as a way to choose an apartment or a single family home.   Though the blog refers to the predicted purchase of Yelp, a very popular review site, by Google, Yelp has since passed on the deal.   Google had already begun to expand its review concept with Google Place Pages, where people can review companies and places.  Instead of just getting limited information on a map, Google now provides an entire page dedicated to information about the company or place.  I tested this by typing in several apartment properties into my Google search bar.  I was able to quickly get reviews by current and previous tenants.  The blog suggests that reviews on the internet will change the apartment industry.  I agree with this.  Whenever I buy a product on the web, I read the reviews to make sure it will fit my needs.

Providing ways for your tenants to communicate with you and you with them is a way of determining how they are doing.  Many property management companies are starting to use online resident portals to accomplish this, letting the tenants schedule the use of common areas, pay their rent online, report maintenance requests, and check the status of existing service requests.   A good online rental property management software program should support this feature as part of the system.

Over communicating with your tenants on what is going on with the property and seeking feedback is the real key to keeping a pulse on what is going on.  It is better to learn how a tenant feels when you can do something about it than waiting for them to post a negative review online.  In his book, ‘What Would Google Do?’, Jeff Jarvis says that a company must allow easy two way communication if they want to be successful today.  The web allows information about a company to travel at the speed of light, so focusing on communication with your tenants will make sure that information is positive.

So how do you make sure your hard work is paying off?   Communicate.

Rob Crichlow
DIY Real Estate Solutions

Posted in Property Management Tips, Real Estate Internet Trends | 2 Comments »

Good Property Management Software Helps Property Management Companies Grow

Wednesday, January 6th, 2010

In many of my previous blogs, I have pointed out that using good rental property management software impacts a property management company in many positive ways.  Well now a recent survey has pointed out it actually helps property management companies grow.  Software Advice has published the results of the survey on their website showing various technologies that growing firms are using.

One quote that stood out to me was, “Companies who used property management specific software managed an average of 102 units per employee. Those that used generic software or spreadsheets only managed an average of 61 units per employee. We acknowledge there are other factors to consider here. But we’re firmly in the camp that an integrated software system frees up property management employees to do more tasks.”  This certainly shows that a company using a well integrated property management program can do more with less people.

Over 60% of the growing companies surveyed used a property management software product.   Other technologies were listed as well, including emailing statements, electronic maintenance requests, online rent payments, integrated accounting, tracking leads electronically, and auto-posting to Craigslist.

One respondent said, “I feel web based software is coming of age …”

I found the survey very interesting and encourage you to check it out.   Staying on top of what is happening in technology is a good idea for any company, but it is essential for a property management company, since increasing the number of units being managed without increasing costs at the same rate is ultimately the goal.

For some tips on researching what products are available today, check out my blog Picking a Property Management Software Solution or checkout our web based property management software as an example of a fully integrated solution.

Rob Crichlow
DIY Real Estate Solutions

Posted in Property Management Software Ideas, Residential Property Industry | No Comments »