By Jo-Anne Oliveri, ireviloution intelligence, Brisbane, Australia
Property management… just mentioning those two words usually sets off a plethora of comments, memories and grunts. Most of them are bad memories and grunts of frustration, annoyance and mild to wild anger. Yep, this
sector of the real estate industry has grown up to be like the delinquent teenage child who is hell bent on causing pain and humility, rebellious in every sense of the word. You only have to ask around to discover that this is a problem the world over… yes, that’s right, the world over.
Why?
There are many reasons why, but the good news is there is no need to be seen as the delinquent and rebellious child anymore. Property management is set to become the golden child of every real estate business. For those agencies that don’t provide leasing and management services it’s time to sit up and listen. It’s time to feel confident in knowing that as a business owner you can design and deliver the leasing and management service of your choice.
It’s important to truly understand what we mean when we say the world is changing and so is the industry. Real estate businesses can no longer rely on commission from property sales alone. The last few years have highlighted the vulnerability each and every real estate business faces. First there was the Global Financial Crisis (GFC). The GFC should have been the wake up call to every real estate business owner needing to understand that they cannot rely on sales alone any longer.
The GFC led to 2011, the year, it seems, of catastrophic natural disasters that are impacting communities in Biblical proportions. My own State of Queensland, that has for many years suffered drought, was 91% flood impacted this past year. The floods were major and destroyed whole communities, even damaging central business districts including the main capital city of Brisbane. There have been earthquakes and continuing shakes in Christchurch, New Zealand, destroying whole communities. The earthquake, tsunami, and nuclear meltdown in Japan, also destroyed whole communities. The tornados touching down across the USA yet again destroyed whole communities in a matter of minutes… and the list go on.
Now I’m not saying it’s the end of the world, but it could certainly be the end of business for real estate brokerages in these areas. With whole communities wiped out and having to be rebuilt, there is little chance of sales for many years to come. There will be no properties to sell, as rebuilding is taking place, but it will also be many years for consumer confidence to return and for the memories to be softened before people start being drawn to these communities again. Real estate sales businesses will close down… however, there are still people who need somewhere to live in these areas, as they will still have ties to the community. The communities need to be rebuilt, businesses need to reopen, community centers, facilities and schools will begin to operate once agin. People will still live there and most will need temporary to long-term accommodation. For those real estate businesses that provide leasing and management services, they will survive, as they will still have a regular monthly income and asset value through their rental services.
Over my coming blogs, I will take you down a path of what has gone wrong in this industry along with how we can make it right. The solutions are available now. The systems, resources, and training are all available.
It’s time for change, a mindset change. Change comes through empowerment. I hope you enjoy my blogs as I aim to empower, educate, and inspire real estate agency owners and teams into being passionate about the leasing and management industry and their ‘chosen’ profession. It’s time to design the business of your choice, design the service of your choice, design the team of your choice, and become a service by choice in your community.
I’m excited and I would love to welcome you along this journey.
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We have been seeing several real estate brokerages in the DFW area opening up property management services for their investor clients. Also, these brokerages’ agents have shifted marketing efforts from primary residences to investment proeprties. “When the sun is shining, it’s time to make hay.” CNR Insurance is seeing a large increase in “Landlord Insurance” policy issuance along with E&O Insurance requests from Real Estate Brokers.
Sean, you are spot on, when you say property management services. Leasing and management is more than just collecting rent, doing the odd inspection and arranging maintenance. It’s about being a consultant to the property owner, regardless of whether it is their own residence or investment. The property owner is looking to our industry for advice in ensuring they maximize their returns, through the rent, and optimize their growth, through the properties long term value. Real estate agents need to work closely with property owners and insurance is an integral part of this. I go so far as to recommend that all property owners must provide confirmation of insurance prior to and whilst managing their property. in our agency we would not manage a property unless an owner had adequate insurance.