DIY Property Management Blog » Real Estate Internet Trends

Tenant Retention Should Be the Focus of Professional Property Managers

Rob — Mon, 01 Mar 2010 23:15:05 +0000

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

Does Good Property Management Matter?

Rob — Tue, 19 Jan 2010 01:18:38 +0000

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

Should You Put Your Property Management Data Online

Rob — Sun, 06 Dec 2009 01:31:50 +0000

After many conversations with property management professionals, it is clear that there is concern in whether to use a web based rental property management software system due to the data being put on a third party server. I can relate with this concern. Years ago, I had the option to use a service to sync my PDA phone with my desktop. The service would first sync the data to their servers and then sync to my PDA phone over the Internet. For some reason, I felt uncomfortable with the thought that my data was being stored on a third party server, so I chose not to use the service.

Today I use a hosted Exchange service to handle my email, calendar, task, and contact management synchronization to my desktop and PDA phone. They deal with all of the upgrade headaches, support of the software and servers, and have prompt and friendly service when I have issues. And I get all of this for just a few dollars a month. What changed? My paradigm changed.

A couple of years ago, the town that I live in had what was later called the 100 year flood. Homes in my neighborhood got two to three feet of water in their basements. Just six months prior, we had set up offices in our basement for a recording studio business my children operate and offices for my wife and me. We had never had a drop of water in our basement for 15 years. So we put our computers on the stands close to the floor (not the best decision). We were fortunate in that we only got 4-6 inches of water. However, it was just enough to harm every computer we had. So even though we had backed up each computer to the others (what were the chances that all of the computers would fail), the worst scenario possible occurred. We were fortunate in that the hard drives were recoverable. If we had gotten 6 more inches of water, that would not have been possible.

Today, I firmly believe that my data is safer when stored on reliable third party servers. They have business level data redundancy and recovery procedures, secure environmentally controlled facilities, and secure data transfer from the web browser to their servers. And it is very affordable.

Property management companies or landlords doing their own management no longer need to worry about these issues. By using an online property management software program, all of the data and software issues are managed by the software company, in a safer and more reliable environment, allowing you to focus on your core business, managing properties. Just look at the growth in popularity of Google’s offering of calendar and document services. Businesses are learning that it cost less and is more reliable to use someone else’s servers than having their own.

Should you put your property management data online? The answer is yes.

Rob Crichlow
DIY Real Estate Solutions

Picking a Property Management Software Solution

Rob — Thu, 03 Dec 2009 15:31:36 +0000

Back in the 90’s, when the use of a professional consulting firm to help a company choose the right property management software system was pretty much the standard, it amused me that the cost of the consulting project was typically three to four times the cost of the software being purchased. I used to joke, “Why doesn’t the company simply purchase and compare the top three programs and throw away the ones that don’t work out? It would actually cost them less money.” Now of course, it was a joke, since the reasoning behind the need for the project was valid. All of the top products looked the same on the surface, so it was hard to tell what was really there unless you reviewed the software.

Well today, we have newer platforms (online property management systems), lower cost delivery choices (using the web browser on one’s desktop computer), better and more sophisticated databases (SQL Server), but has the actual problem of choosing a system gone away? Actually I believe it has. Let me explain.

Yes, in many ways, the top products still look the same on the surface, which is not surprising since they are addressing the common needs of the residential property management industry. However the differences are there and make a big difference in the productivity of the users and ROI received from using the software. So what is different today? It is the Internet.

I promised my wife a new dishwasher for Christmas. I know, very romantic. So how do we determine which one is best for our family? We go online, do a simple comparison by browsing a few popular websites, and narrow the selection by price, features, and customer reviews. By looking at pictures, checking out colors, and specifications we find the one we are looking for.

Today, you can do the same thing for web based rental property software. You can look at features and benefits, check out pricing, look at online software demos, and even try out a free trial version. The good news is that with this method of comparing software, the cost of the solution is reduced. It allows the software companies to deliver enterprise level systems to smaller organizations for a fraction of the cost. So now, lower cost does not mean poorer quality, but a more efficient method of delivery of the software. The key is what is in the product and how does it make the user’s job easier and more productive.

Since software support is also a key component, using a free trial allows you to test the water on customer service. You can see how timely the support is, how they understand your issue, and are they able to answer the questions. I have found that this may be one of the biggest differentiators of products today.

So how do you pick the right property management software? You use it. It can’t get better than that.

Rob Crichlow
DIY Real Estate Solutions

Social Networking and Property Management

Rob — Wed, 25 Nov 2009 15:52:31 +0000

With the introduction of social networking services like Facebook, Twitter, and LinkedIn, the way we communicate with people has changed again. It reminds me of when mobile phones came out. At first, only a few people had them, mostly business people. When away from the office or home, most of us would only make a call when it was urgent, and then we had to find a pay phone. I can remember standing in the rain to make a call to my office while on the road (remember using the ‘calling’ card?). Now, everyone has one, and we use them whenever we want, wherever we are. Many young kids today have never used a real pay phone. When I first heard of Facebook, I thought it would only be used by teenagers (like My Space was). Who would ever want to put personal information in place where everyone could see it? Well I was wrong. Virtually everyone I know has a Facebook account today. My wife has re-established relationships with people we went to college with.

What does this have to with the property management industry? Just like the mobile phone, social networking has become part of how businesses communicate today. I was at a business meeting last week, and a person I had never met came up to me and said, ‘I am a social networking consultant and I would like to talk to you about how I can help you with your company’s social networking plans’. I must admit, I was stunned. If there are consultants earning money helping companies learn how to use social networking services, then it has become common practice.

I am a member of the Property Management Professionals group at www.linkedin.com and found this article posted last week: Social Networking Strategies That Work. Just like having a web site today is standard for all businesses, having a presence on social networking services will be the standard in the near future. The key will be learning how to use it effectively. I am practicing what I write about, and have started our presence on Facebook and Twitter. Check out our Facebook page at DIY Facebook Page and our Twitter account at DIY Real Estate. We welcome you as a fan on our Facebook page and being a follower on our Twitter page. So whether you are a property management services company or a web based property management software company, social networking will be required. SHFUZPAFHER7 4VGQ8KFJJ528

Rob Crichlow
DIY Real Estate Solutions