Value Drivers for Property Management
Value drivers for a property management company typically answer the following questions: “What brings customers to my property management firm instead of a competitor?” and “What are the key aspects of my property management firm that impact the value?”
These value drivers increase the value of your property management company. It is important to understand where your business stands on each of the following value drivers. Doing so can help in determining how to increase the value of your property management company. For more information, see Valuing a Property Management Firm.
Value Drivers for Property Management
Located in High Demand Markets
One way to drive the value of your property management company is to locate the company where demand for real estate services is high. Great locations include areas with strong population growth. Being located in a densely populated area will help you attract more tenants, which increases the value of your firm.
Another aspect to consider is the demographics of the location. Is it a low-income area or a high-income area? In addition, the type of property you manage impacts the value. Is your property focused on short-term rentals, nightly stays, HOA, or vacation rentals? These aspects, along with market demand, can increase the value of your property management firm.
Next, there are many competitors in the property management industry. It’s important to create a marketing strategy to differentiate your firm from competitors. One marketing strategy is to focus your marketing efforts on the features that stand-out in your property. For example, market the seaside views, countryside views, spacious rooms, or other appealing features within your property. You can market these features through social media, flyers, television ads, radio ads, etc.
Another way to create value for your property management firm is to create a word-of-mouth marketing plan. The goal is to incentivize existing tenants to encourage friends to become tenants at your property. The value of your property will increase as current tenants refer family members and friends to your property.
Property Management Software
As a property manager, it is critical to use property management software. Using efficient software is crucial to your company’s success and value. The software can save you time and money. The use of software can be helpful for the following situations:
- Lower labor cost by minimizing manual entry and errors
- Increase documentation efficiency
- List properties
- Sign leases
- Screen tenants
- Manage maintenance requests
- Collect payments
Taking advantage and utilizing property management software will increase the value of your property management firm. It will also increase efficiency, which in turn saves time and money.
Social Media Presence
Having a strong social media presence will increase the value of your property management firm. Your company website and social media accounts are oftentimes the first places people will look at. It’s important to make your website user-friendly. Your website should also include up-to-date information.
Social media is a great way to interact with customers and attract new customers. Select a platform that works best for your business. Social media platforms include Facebook, Instagram, Twitter, LinkedIn, etc… As you navigate through social media, commit to posting, commenting, and following-up consistently. New posts and content on social media and your website increase your SEO (search engine optimization). This will increase exposure to your firm. For more information, see Boosting Your SEO.
Communication with Tenants
Responding to tenants and potential tenants regularly and efficiently will increase tenant satisfaction. Typically, tenants won’t be satisfied with your services if they have to wait days or weeks to hear from you. This could result in negative online reviews.
As you respond to tenants on a regular basis, you will create a positive reputation. A positive reputation brings more tenants to your property, which increases the value of your property management firm.
Maintaining a clean and organized property is essential to increasing the value of your property management company. A tenant will be less interested in your property if it’s messy and unorganized. Make sure your property is clean and attractive. Tenets will be more favorable in leaving reviews and recommendations.
A few other ways to increase the value of your property is to offer fun amenities. Some possible amenities could include:
- Swimming pool
- Party room
- Bike paths
- Fitness center
- Media room
Offering services and amenities your competitors don’t offer can help attract new tenants.
Understanding what drives the value of your property management firm can help you to set goals to maximize the value. There are many value drivers for a property management firm. These are some of the most common Peak Business Valuation, business appraiser Utah, sees.
Peak Business Valuation, business appraiser Utah, helps by providing business valuations to value a property management firm. For additional information on discovering the value of your company and how to increase it, schedule a free consultation call with Peak Business Valuation!
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