The last few years have been tumultuous, and many property management firms have been forced to adjust their strategies. Those that have successfully adapted to the tight rental market, high interest rates, and elevated inflation have thrived. However, even the most successful property managers still have challenges to overcome.
There are many obstacles that span the property management industry – impacting large and small firms in every geographic area. According to our clients, the five following challenges are the most common hurdles to success in the property management sector. By addressing them, your property management firm can improve customer service, reduce your workload, and drive profitability.
For a deeper dive into this topic, download our comprehensive white paper for property managers.
#1 Resident Relations
Residents tend to communicate with their property manager when they are experiencing a problem. While working to improve this type of reactive communication is important, it can also be beneficial to improve proactive communication. This could include posting regularly on social media, sending email updates to residents, keeping your website up to date, and even posting flyers on the community bulletin board.
A base of clear, positive communication helps residents feel more connected to your firm. In turn, they can begin to view the relationship as mutually beneficial.
For a list of tools that can help you communicate effectively with your residents, download our comprehensive whitepaper for property managers.
#2 Financial Management
With elevated interest rates and construction costs, many property managers have seen profit margins squeezed. Tighter margins usually leave only two options – reduce costs or increase revenue. It is not always possible to cut costs, so you must find creative ways to grow revenue.
One often overlooked way to generate additional revenue is to seek a higher rate of return on reserve cash. However, higher yield investments often include the tradeoff of reduced liquidity. Fortunately for property managers, advances in financial technology – a.k.a. fintech – make it simple to achieve the right balance of safety, liquidity, and returns.
#3 Board Relations and Governance
As a property manager, you face the challenge of maintaining a productive relationship with HOAs and other governing bodies. Ideally, the property manager and boards work together to implement decisions that benefit residents. However, this relationship can become strained when the two groups have opposing goals.
To maintain positive relationships with HOA boards, you need to stay current on the regulations that govern the community and ensure your processes comply with those rules. Your company also needs an effective communication plan. This includes providing accurate, complete information that is easily digestible. When your team is knowledgeable and communicates effectively, boards will be more likely to hear your ideas.
#4 Technology and Software
The right software can save your firm valuable time, make residents more self-reliant, and drive profitability. In fact, property management software is so popular that the market was valued at over $20 billion in 2022 and is projected to more than double by 2030.
While the promise of a custom, integrated, digital property management platform is tempting, it can also be expensive. Your goal should be to find software that fits within your budget and provides a net return on investment.
For a list of the most popular property management software providers, download our comprehensive white paper for property managers.
#5 Vendor Management
Reliable vendors are tough to find, so you should do everything possible to maintain positive relationships with the ones you trust. Maintaining these relationships is especially important today as most industries are experiencing labor shortages.
To promote strong partnerships, it is vital to pay vendors on time and the correct amount. Your property management software may include a vendor payment feature. However, it can still be time-consuming to manage payments to dozens of companies. Fortunately, there is a fintech-powered vendor payment system that allows your company to pay all vendors in a single platform. With this technology, you can ensure all bills are paid on time and securely.
The five challenges presented in this article are just a few of the hurdles successful property managers might encounter. As new obstacles emerge, finding the right partner can make all the difference. With strategic relationships and the latest technology, your company can approach emerging challenges with confidence.
For a deeper dive into each of these challenges, download our comprehensive white paper for property managers.
Property Management Firms Thrive When They Partner with ADM
At ADM, our proprietary fintech powers several solutions that reduce work and risk for property management companies. Our deposit management services allow us to spread millions in cash across our nationwide network of financial institutions that compete for deposits. This provides our clients with access to FDIC / NCUA insurance for all cash along with nationally competitive rates.
Additionally, our vendor payment solutions make it simple to manage dozens of vendors. This service can integrate with our deposit management platform, providing a streamlined process.
To learn more, contact a member of our team today.