The Five Key Factors Driving Property Management Success

To be successful in Property Management, you need to focus on just 5 key success factors. These underpin the performance of any lettings or estate agency. Improve your performance in these and (all other things being equal) your profitability is guaranteed to improve.

Unit Churn

The turnover in your base units and properties is critical to your business. It’s a fact of life. Landlords will sell properties and/or be lost to competitors. Taking action to minimise unit churn though (eg through ensuring your staff are serving them well) is within your control.

Unit Additions

New landlords are hard to come by. Competition can be fierce. With a proven, confident proposition and approach, though, you can win new units and landlords. Happy, high performing landlords are more likely to recommend you to others and when their portfolios grow, your agency grows too.

Average Rent

Most agents take a percentage fee of rent collected each month. So, when rents increase year-on-year, your fees grow too.

In 2023, rent rises were used to offset mortgage rate rises plus growing maintenance costs. With rental stock limited, there’s still pressure to increase rents. This directly translates into more fees for agents on a percentage basis.

Anything else you can influence? Other factors which positively impact rents include agency coverage area and perceived brand value in the marketplace.

Management Fee %

The percentage charged to landlords depends on local competition, agent reputation, confidence and each landlord’s attitude towards fees and increases, given the size of their portfolio.

A straight % increase (or similar) will have the biggest impact on your business. This can be hard to implement without upsetting landlords though.

Landlord Compensation/Issue Count

Staff are only human and unfortunately make mistakes. A PM team is only as good as the information in its PMS. Garbage-in, garbage-out as the saying goes.

If agencies don’t have an iron grip on processes, systems and accuracy, renewals and expiry of compliance docs can easily be missed. This can leave landlords on the hook or out of pocket and seeking compensation.

A good measure for how you are doing, is how much your agency pays back to landlords, together with a count of ‘money’ issues caused by the team.

How Do We Use These Factors?

Want to know how to use these factors to create a high performing agency? Check out our blog on High Performing Teams.

If you want any help developing your baseline figures, programme of activities or balanced scorecard, get in touch with the LoftyWorks team.