Ever experienced this?
You’re working so hard to bring new properties in.
But they’re being sold off almost as fast as you can bring new properties in!
And, while you hate to blame your sales team (or worse, a competitor’s sales team)
You can’t help it!
You’re sick of your rent roll being sold off!
Seriously, every time one of those properties is sold out of your rent roll, it loses about $1400-$2000 of income each year (based on some averages I’ll explain shortly!)
Not to mention the value of that property as part of a rent roll sale.
And if you’re the one who owns the rent roll…
That’s no fun at all!
So, how do you continue to grow, even when properties are being sold off your rent roll?
Here are 3 steps you can take to continue growing, even when properties are being sold off.
Focus on Income
For too long, our industry has been focused on the number of properties we manage. However, with more and more independent property management companies popping up, there’s more value in focusing on your income.
Let’s work with an example here.
Say you have a portfolio of 100 properties.
And your average rent is $400 per week
And your average commission is 7%
You’re making about $145,000 in commission each year.
I know, I haven’t included additional fees, which you’re probably also charging.
I want to keep it nice and simple.
Now, let’s say that you lose 10% of your properties this year because they get sold off your rent roll
But on the remaining 90% you increase your commission to 8%
Which costs each landlord $4 extra each week.
Trust me, if you’ve been doing a great job for your landlords, they’ll be okay with an extra $4 per week to have their most important asset being managed by the best in the business! ?
Now, take a look at these numbers….
The remaining 90 properties
At the same rent of $400 per week (although, you probably ARE increasing rents where possible)
At 8% commission
Will make you just under $150,000 in commission in a year.
So, you’re actually making about $5,000 more each year.
While doing about 10% less work.
Imagine if you also added an extra $5 admin fee per month, per property too…
You’d increase your income by a little over $5,000 per year.
This is why we need to focus on the dollars, rather than the number of properties.
Analyse your Expenses
One of the biggest mistakes I see made in businesses is allowing expenses to continue, even when you don’t need the service any more.
Take a look at all of your expenses to ensure you’re still using the service you’re paying for.
Or, see if you can get a better deal!
Lots of service providers offer better deals for their new clients, but sometimes, if you phone them they’ll give you the special deal too.
For example, I recently contacted Optus (my mobile phone service provider) and got a great deal, where I didn’t have to pay a cent extra each month but I got an extra 20G of data!
If I didn’t want the extra data, I actually could have saved $10 per month on my monthly fee!
Then, I’ve just realized that I’m paying for an additional email hosting account that I’m no longer using. Hello $5 per month saving!
I’ve recently downgraded my Calendly account to the free version (because I don’t need the paid version any more) – there’s $5 per month
I’ve also downgraded my Buffer account to the free version also (for the same reasons) – saving $15 per month.
We’ve been having some trouble with our internet provider, so I did a switch, saving $30 per month (same amount of data with our new plan!)
I’ve swapped my car insurance to a new insurance company, saving me $35 per month!
Seriously, it all adds up!
Just these tiny changes have saved me about $100 per month!
That’s nearly the equivalent of one property’s commission!
Think about how you can apply this in your own business.
Which one is best (and most cost effective) for you?
When was the last time you checked your insurance expenses?
Where are you spending money you don’t need to?
List More Properties
I know that this is the tip you were waiting for me to give you.
But, it’s not always the first priority in your business.
Now, if you’re in a market that is selling lots of properties, rather than having investors entering the market, you need to be clever with where you find investors.
This is where referrals become SUPER important.
You need to find people who are already in the market as investors, and get in front of them!
So, you’ve got to tap into your referral network.
And if you’re wanting to get more referrals, you need to read my article on Boost Your Referrals Today!
In that article you’ll find a simple system for getting more referrals, as well as a downloadable blueprint for this system.
If you haven’t seen my last blog titled How To Get More Engagement On Facebook (for Rent Roll Growth) be sure to check that out next!