In December, most property management companies are preparing their owner statements so they can have them all sent by the end of January. Owner reports detail all maintenance work completed in the past year and, most importantly, outline how much your property owners make from their investments. If these reports differ from your owners’ expectations of what’s profitable, they may sell their properties. Property owner churn leads to a direct decrease in income for your company, so avoiding churn is the best way to continue growing your portfolio. So what are the main reasons property owners sell? More importantly, how can it be avoided?
1. High Rental Turnover Rate
While some rental turnover is standard, high turnover rates lead to many unexpected costs for your property owners. The price of a vacancy can be up to $2,000 lost if a unit sits vacant for 30 days. That is just in lost rent not even including the costs of rental turnovers. As you can see, too much rental turnover can quickly eat into profits for your property owners.
If your residents aren’t happy with your business, specifically with your maintenance process, they will likely not renew their lease. With higher turnover rates comes higher owner churn. If you can encourage more residents to renew their lease, you retain your property owner’s money.
2. Too Much Work For Them
One of the biggest reasons owners hire a property management company is to avoid dealing with managing their properties. Owners with extensive portfolios might not have the capacity to manage their properties successfully. Or in some cases, owners might live far from the properties they own. The best part of hiring a property manager is that owners can have peace of mind knowing their properties are being taken care of. Things like leasing, maintenance, and dealing with residents are taken off your owner’s plate.
If an owner hires a property management company and still feels like they are spending all their time dealing with their properties, they will become upset with the work you are providing. If their properties become more work than they are worth, your property owners will be more apt to sell.
3. High Maintenance Costs
Again, a property owner’s primary goal is to make money with their properties. If you have an inefficient maintenance process, your owners may experience high maintenance costs on their owner statements. Improving your maintenance process creates a better experience for your owners and residents. A streamlined maintenance process will keep maintenance costs low and your owner’s assets in excellent condition.
Also, with automated maintenance software like Property Meld, your owners can have transparency and communication in your maintenance process. In addition, they can approve maintenance costs in one convenient location quickly. Keeping maintenance costs low will lead to happier owners who are more likely to stay customers longer.
For more information on how maintenance can change your relationship with your owners, schedule a demo with our maintenance experts.
