According to IBIS World, there were over 231,000 residential property management companies across the U.S., marking a 3.6% increase from 2022.
The demand for rental property management services is driving this growth, and you have decided to capitalize on it. Running a property management company has strong potential to be a lucrative venture, but a lot will depend on several factors, including its location, your financial planning acumen, and your management expertise.
In this article, our focus is on how to leverage portfolio management to build long-term stability for your company.
Let's get into it!
Manage Different Types of Properties
A property management company can offer any of the following services:
- Long-term residential property management
- Short-term/vacation rental management
- Commercial property management
- HOA management.
Taking a specialized approach and offering only one of these services, say vacation rental management, has its upsides, but over the long term, it can restrict the growth of your company. Broadening your service offerings will enable your company to target a bigger client base.
For example, if your company is located in a vacation town like Orlando, it's understandable you'll want to focus on offering short-term rental management. However, offering long-term residential property management as well can open up the company to more clients.
Investment Property Management
Managing a property, whether residential or commercial, is the bread and butter of any property management firm. While this can be enough to spur the growth of your company, modern investors are looking for providers who offer more than just that; they want investment property management support.
Every year, thousands of investors flock to Orlando to find investment opportunities. Although some of them prefer to scout the market on their own, a vast majority rely on local realtors and other experts to develop an understanding of the market.
As such, it's in the best interest of your company's long-term growth and stability to offer other real estate asset management services as well, such as brokerage services to buyers and sellers.
Build a Solid Team
The competence of a property management company entirely depends on its experts. In the early days of your business, you might be the only property manager, assisted by a receptionist or officer manager. As you onboard more clients, though, the need to hire more property managers will arise.
Generally, the goal is to maintain a healthy manager-to-property ratio. Although there's no industry standard, one manager can oversee between 10 and 20 properties. Anything greater than that can negatively affect service delivery as the manager may not have enough time to attend to all the needs of each property.
Portfolio Management Is the Key to Long-Term Stability and Growth
The property management industry is thriving, but not every company is making a killing. Putting the basics of building a business in place is a good start, but it's time to look into portfolio management as a tool for growing the company and securing its future.
If you need professional support, you're welcome to consult a professional at PMI Prime Home. We've been perfecting the property management craft for over a decade.
Get in touch to learn more about how we can help you achieve your personal and professional goals.
