I read an interesting article earlier this week which was reacting to an ARPM report suggesting Let only Agents were losing out on significant income by not offering Full Management services. (https://www.propertyreporter.co.uk/landlords/new-research-reveals-let-only-agents-are-losing-80-of-potential-income-per-tenancy.html).
Of course revenue is a hot topic at the moment because of the recent ban on charging tenant fees. It is important for agents to consider ways to increase revenue streams. I however don’t want to focus on the financial aspects of this article but the operational considerations.
Something that I have no doubt is the need to effectively manage a rental property. Legislation is not only getting more demanding, it continues to evolve, and it is essential for whoever manages the property, be it landlord or agent, to be both on top of the evolving market and to adapt processes and controls accordingly.
With so many let-only agents it suggests that this activity is already being performed by landlords. If this is the case, is there really a market for agents to perform this role?
Managing a tenancy portfolio may at one stage have been possible without a good deal of understanding of the market. I believe however this is, and should be, increasingly difficult. Taking on the challenge of Management and all that entails brings significant value to the landlords who neither have the time nor inclination to do it themselves. With this ‘value’ comes the ability to charge for the service being offered.
To the agent or landlord that chooses to expand their offer it must be highlighted that managing is not the same as sales and contracting. It requires different people, processes and technology to ensure that, as you scale, you remain efficient and as a result cost effective whilst retaining a good level of service.
It must also be pointed out that the market is also getting increasingly competitive. Online agencies are building operations that can benefit from economies of scale and are not limited by expensive high street shop front accommodation.
To consider how can you set yourself up for success you need to consider the value proposition that comes with Property Management.
Landlords need to know that whilst their properties are being managed someone is ensuring that they remain fully compliant. This means EPC’s are valid, Gas Safety checks are performed and documentation is correctly issued to tenants. It also means that if mould or HSE related problems are reported they are effectively managed with appropriate communication and within required timescales. All of this needs to be auditable. If a section 21 has to be raised in the future you don’t want a failure of procedure in the past cause you problems.
When that tap is leaking nobody cares about speaking to a person they know. They just want to call a number or report it online and have the full belief that it is going to be managed. The managing agent needs to consider themselves more like a friendly call centre than the single named point of contact that is required during contracting. Of course I’m not suggesting losing the personal nature of the agency but balancing that with effective operations where required.
One of the problems with efficient and effective operations is that, in your customers eyes, the levels of noise and visible issues start to fade. This of course is good. However, at the same time, your customers start to forget about the value of the service they are receiving.
This is where transparency comes into play. Monthly reporting detailing the problems resolved, time taken, a forward planner for future work will all help demonstrate the true value of good Property Management.
Good operations results in stronger relationships. I believe that with a good quality of service you will find that tenants stay longer and as a result landlords are pleased with the outcome and they themselves remain longer with their preferred agent. Landlords need to be able to compare the amount they pay each month directly against the value that they receive.
Konnexsion is a property management application designed from it’s core to manage operations. Conversations are tracked, property and tenancy related activity recorded and scheduled in the future. You retain full visibility of open workload, who is managing it and how long it has been open. Issues can be raised by tenants or landlords alike, these come in via the portal, email or sms and all get consolidated into a single place to be assigned to the most appropriate team member for resolution.
Konnexsion ensures that your operations are a key differentiating factor in the value proposition you offer your customers.