7 Hidden Ways to Increase Revenue in Your Property Management Business
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AppFolio & NARPM webinar featuring Robert Locke (NARPM Educator). Real world scenarios and strategies that will help you rethink the way you charge for your services and run your business. + Why you need to un-bundle your services and charge for separate tasks. + Learn how to evaluate your scope of service and why it's important for your business. + Key strategies for disclosing those fees to owners. + Introduction to a number of fees you should consider charging for to increase revenue. + And more great tips!
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7 Hidden Ways to Increase Revenue in Your Property Management Business
- 1. 7 Hidden Ways to Increase Revenue in Your Property Management Business Turning a nickel-dime business into a money-machine
- 2. AppFolio • Web-based property management software • Complete Solution Includes • Property Mgmt & Accounting • Online rent collection (free) • Prospect / Guest Card Tracking • Marketing • Website • Payment processing • Online applications • Resident Screening So You Run a More Successful Business ©2012 AppFolio, Inc. All Rights Reserved.
- 3. Robert Locke • RMP, MPM • National Trainer for NARPM • Licensed 37 Years • Owner of Crown Realty & Management Corporation, CRMC • Past President NARPMGA • International Trainer for Property Managers • Founder of Crown Investor Institute ©2012 AppFolio, Inc. All Rights Reserved.
- 4. #1 and “Best Kept” Secret of Property Management There’s _____ ____________ in property management the way the b___________ c_________________ does it. ©2012 AppFolio, Inc. All Rights Reserved.
- 5. Consider the Evidence • PM is Typically a Sideline Business • Often a Cottage Industry • A Very Thin Margin Business • Expenses Outweigh Income for a Long Time • We Harness Family and Spouses to Support Us • Sales Firms Don’t Champion Property Managers • Few Free-Standing Companies ©2012 AppFolio, Inc. All Rights Reserved.
- 6. Polling Question What is your annual income per property per year? Gross Revenue = $__________ # of Properties ©2012 AppFolio, Inc. All Rights Reserved.
- 7. Revenue from Property Management ©2012 AppFolio, Inc. All Rights Reserved.
- 8. The Challenge • Not State Specific • Not Setting Fees (FTC) • Fighting the Broker Mindset • Thinking Like a Broker Makes it Hard to Make Money in Property Management ©2012 AppFolio, Inc. All Rights Reserved.
- 9. #2 Recognize Property Management as a Service Business • Brokerage is a Sales Business • Leasing is a Sales Business • Property Management is a Service Business ©2012 AppFolio, Inc. All Rights Reserved.
- 10. Sales vs. Service Business Leasing Management • Clear Finish Lines • No Finish Lines • Income Tied to Outcome • Income not Tied • Work for Free • Get Paid for Labor • Commissionable Events • No Events • People Driven • Systems Driven • Big Checks • Lots of Small Charges • Calculated as % • Charged by the Task • Low Volume • High Volume ©2012 AppFolio, Inc. All Rights Reserved.
- 11. #3 Learn to Unbundle Your Services ©2012 AppFolio, Inc. All Rights Reserved.
- 12. Service Business Terms • Charge by the Task • Charge an Hourly Fee • Make a Spread • Get a Commission, Rebate, or Referral Fee • Profit Margin • Labor Costs • Liability Costs ©2012 AppFolio, Inc. All Rights Reserved.
- 13. Let Go of Your Broker Mindset • Tying Your Income to the Outcome • Using MLS to Market Your Listing • Join Property Management Trade Associations (NARPM.org) • Adopting Standardized Forms • Adopt Property Management Software ©2012 AppFolio, Inc. All Rights Reserved.
- 14. Polling Question #4 - Identify Your Economic Generator Quiz: What one event in this business starts all your revenue streams pumping out money? (Group Exercise) ©2012 AppFolio, Inc. All Rights Reserved.
- 15. Excuses You Will Make • That Won’t Work in My Market • All My Owners Will Leave • My Broker Won’t Let Me • I’ll Lose My License ©2012 AppFolio, Inc. All Rights Reserved.
- 16. Excuses You Will Make • The Landlord Tenant Law Won’t … • My Conscience Won’t Let Me… • Code of Ethics Won’t Let Me … • My Management Style Won’t Let Me … ©2012 AppFolio, Inc. All Rights Reserved.
- 17. Property Management Style Owner Broker Style Tenant Lease Agreement Management Agreement Property Manager
- 18. Property Management Style Manager Style Management Lease Agreement Agreement Owner Property Manager Tenant
- 19. Polling Question Do you see yourself as a broker-style property manager?
- 20. #5 - Learn When & How to Disclose Fees • Define Fees Charged to Owners – vs. Fees to Tenants – vs. Spreads, Rebates, Commissions • Define Transitional vs. Operational Revenue Streams • Consider Ways and Times to Disclose ©2012 AppFolio, Inc. All Rights Reserved.
- 21. Disclosing Fees • In Management Agreement • In Housekeeping Documents • In Owner Handbook • Notify in Writing Along the Way – As it Happens (Driven by Events) – Starting at a Future Date – Annual Notices ©2012 AppFolio, Inc. All Rights Reserved.
- 22. Language Establishing Charges in Fee Structure The agreement includes this management agreement, the housekeeping documents executed along with this agreement, the agent’s owner manual, and the annual disclosure changes required by changes in the laws and economics that govern the property management business in (your state). ©2012 AppFolio, Inc. All Rights Reserved.
- 23. #6 ©2012 AppFolio, Inc. All Rights Reserved.
- 24. #6 – Set Up Other Businesses • Maintenance Company • Leasing Services • Carrier Company • Collections Business • Small Loan Company • Eviction Services • Utility Changeover Service ©2012 AppFolio, Inc. All Rights Reserved.
- 25. #7 – Charge for Services Outside the Norm • Managing the Move In – Fee to Change the Time – After Hours Move In Charge – Late Arrival Charge – Stand Up Charge – Forget to Change Utilities – Forgot Cashier’s Check ©2012 AppFolio, Inc. All Rights Reserved.
- 26. #7 – Charge for Services Outside the Norm Managing the Move Out • Utilities Off Charge • “I Want to be Present” Fee • After Hours Move Out Fee • Excessive Charges Fee ©2012 AppFolio, Inc. All Rights Reserved.
- 27. 7 Hidden Ways to Increase Revenue in Your Property Management Business Download 100 services to charge for at CrownInvestorInstitute.com and click on “FREE Class Downloads!” on the bottom right side of page find “7 Hidden Ways” button username & password: app613 20% Discount Code: 546253 good until 6/30 ©2012 AppFolio, Inc. All Rights Reserved.