How to Increase Property Management Profits in 2024

Does your property management business consistently turn an impressive profit or are you like one of thousands of entrepreneurs struggling to get by?

There are no two ways about it: earning a profit as a property manager is an increasingly difficult challenge for American property managers.

House sales across the nation have fallen to the lowest levels in over a decade, as investors and residential buyers alike grapple with high interest rates. With fewer people buying and selling, rental inventory in many markets is also limited. This makes landing property management leads and closing deals more complicated, straining the tight margins many property management companies already operate on monthly.

Are you feeling stuck, discouraged, or scared about the future of your business?

The good news is that even in a lackluster economic environment, you can increase property management profits and drive your business forward. You can’t rely on outdated lead generation tools or expensive PPC ads to drive new growth in your business, however. If you’re eager to start 2024 off on the right foot, learn how to increase your property management profits using the five innovative techniques below.

Dial in Your Operations

Operational headaches are easily one of the biggest hurdles you’ll face if you’re eager to increase property management profits in the new year. Even the leanest, most capable teams struggle when a business’ operations are a mess. And fortunately, once you start cleaning up your operational issues, the ultimate impact will have a snowball effect. As one area gets stronger, it will encourage further health in all the other arenas of your business.

So, how do you start working on streamlining your property management operations?

1. Consider a Time Study

   First, figure out where your time is actually going. Far too many property management entrepreneurs have no real idea of where time gets spent in their business. As the old adage goes, time is money. If you want to get your business on the right track, you need to have a clear understanding of what your team is doing every day and how much money it’s costing you.

   Don’t think this is only a menial task you need to assign to your employees; time studies are immensely useful for you as a business owner, too. Your time is valuable and if you’re like most brokers, you never have enough of it. It can be difficult to pinpoint exactly where your time is being cannibalized, however. A time study will help you figure that out.

2. Shuffle Your Team As Necessary

   Let’s face it: letting team members go is never pleasant. It is, however, a necessary part of doing business. After having your team complete a comprehensive study of their spent time, you may determine you have too much capacity, in which case, you’ll need to determine if there are roles that are no longer necessary.

   Conversely, you may need to add additional team members to your management team. If you’ve overloaded your existing team with too much to do, they’re stuck in the weeds and ineffective, which could cause you to lose business by angering your clients.

   Figure out what your operational needs actually are and go from there.

3. Hire an Operator

   Still trying to go it alone without an operator’s support? Far too many broker-owners find themselves in the same shoes, trying to handle all of their company’s operational processes solo. And then, you’re stuck in the endless cycle, running around like a chicken with its head cut off, always juggling way too much and never getting anything done.

   The solo approach might be okay for new businesses with small management portfolios, in almost all other scenarios, hiring an operator is a call that will make a dramatic impact on your company.

Reposition Your Company

When was the last time you took a deep dive into consumer perception of your brand?

Consider this: have you ever needed to book a hotel and used a booking engine like Expedia or Priceline to compare different options? What factors ultimately impacted your decision?

You likely took the location, amenities, and price of the hotels into your decision-making process. But if several of the hotels were of a similar quality and caliber, the brand identity and past customer reviews may have sealed the deal for you. Why stay in a hotel that costs just as much as the one across the street, when the other hotel offers better rooms, better breakfast, and better customer service?

You have to think of your company in the same way. If you’re eager to increase property management profits, you need to figure out what it is that you offer to investors and start to troubleshoot areas where that message may have been misconstrued or misrepresented.

Start Selling Differently

Still stuck trying to canvas for property management leads and finding that you’re just not able to get the same volume as you were before? Maybe your old sales tactics just aren’t working and you’re spending a small fortune on advertising. A surefire way to put your profits into a tailspin and kill your motivation and drive is to focus on the wrong type of selling to property investors.

In our Growth Accelerator program, we teach property managers how to collect warm leads without the massive costs and time expense of usual sales tactics. Learn more about our warm lead canvassing tools to determine how you can set your business up for longterm success.

Implement a Profit Driven Accounting System

What does your current accounting system look like? Far too many business owners simply pay the bills using the money that lands in their operating account. Then, once all is said and done, the truth is plain to see: is the company profitable or is it in the red?

Unfortunately, this way of doing things doesn’t offer a full picture of your organizational health. If anything, it’s simply an emergency stop gap to keep your company alive, but it’s definitely not going to help you increase property management profits.

Ready to Increase Property Management Profits?

No matter how far gone things may seem, your property management business can experience greater health and profitability in 2024. To achieve those results, however, you need to be willing to do what it takes to rewrite the way you do things.

Surround yourself with the right support and put in the work, and 2024 will be the best year your business has ever seen; leave everything to chance, and you may find yourself the victim of tough market trends. It’s your choice.

Need a helping hand to accomplish your business goals? Learn how the DoorGrow Mastermind is designed to help you succeed.