Outsourcing to rental property management companies – is
it cost effective?
So, just how cost effective are rental property management
companies? Like every business, as we navigate our way through the pandemic, running
costs are at the forefront of our minds. Property agents have been hit hard by
the lockdown, but as the world gradually settles into some sort of normal, the
fallout is becoming evident, and it’s not great.
The impact of decreased footfall on the high street has
impacted every aspect of the property sale and lettings industry. No matter how
big or small your property agency is, lettings form a vital part of the
business creating regular income, and a boost to the sales funnel for property
sales. But, at a time when you need to have more fee earners out there closing
deals and increasing your letting portfolio, you’re also dealing with a bottle
neck of property management administration. New safety regulations, renewals, property
inspections, all delayed during the lockdown. It’s hard to see how to strike a
balance and successfully release you to sell rather than administer.
The average sized property agency has approximately 6 desks,
with at least two of them being occupied by property management staff. Of
course, you need to have dedicated resources to cover your letting business,
but they don’t necessarily have to be in-house. Property Management is highly
specialised (and not the cheapest thing to maintain when you add in annual fees
for subscriptions, training and banking), so why try to do it inhouse?
Traditionally it’s how it’s been done, but like everything else today, the
world has changed.
The word outsourcing strikes fear in the hearts of most
business owners; will the benefits by outweighed by the negative impact of
losing control? Maybe back in the day, but not now. It’s fair to say that not
all property management companies were created equal, so it’s essential you do
the research to ensure that their service model reflects your own. There are
two distinct breeds of property management company; those who use their brand
and those who allow you to brand it with your agency name and brand. These are
referred to white label services and definitely present the best option as it
allows you to improve your profit base without diluting your offering (or
perceived offering).
Outsourcing your property management to a white label
service, is something that has only just become possible and there are very few
companies who offer it. The advantages of outsourcing property management are
many, with the biggest motivation being the ability to radically improve your
profit margin for letting.
The question of cost effectiveness is always the next on the
lips of agency owners, when the issue of quality and reliability has been
addressed. Let me make this simple for you to understand.
OUTSOURCING YOUR PROPERTY MANAGEMENT SERVICES WILL INCREASE YOUR PROFIT BY ALMOST 40%!
Right out of the gate the savings come into sharp focus in
terms of direct costs to the business. BUT the biggest advantage of outsourcing
property management is that it releases those precious desks to be filled with
fee earners. How much extra profit could you make with more fee earners.
It’s a no-brainer. Outsourcing may be the new kid on the
block in the property industry, but it’s the only solution for agency owners
who need to increase the scope of their business.
PPM was one of the first companies in the UK to offer a
white label property management service. Outsourcing will transform your
ability to sell more, while simultaneously delivering a superior standard of
property management for your landlords and tenants.
