Debunking the Eight Biggest Myths About Partnering with a Property Management Company
Here’s one of the great ironies of the property management industry: though it’s incredibly big, it’s still a big mystery to most people.
Let’s let the numbers do the talking. In the United States, 24% of homes are part of associations, with a total value of $4.65 trillion and $65 billion collected in assessments. In Canada, the industry generates about $6 billion in annual revenue with a healthy annual growth rate of 3.4%.
So ask yourself this question: how many multi-billion dollar industries do you know whose basic business functions are a relative mystery to people, including the potential clients the industry is designed to serve?
In the interest of transforming mystery into a portrait of the industry’s reality, you’re invited to consider (that is, re-consider) these eight myths about property management firms.
- Myth: It’s a thankless job, so no real professionals want to do it. Fact: There are thousands of property managers in North America who are highly trained and licensed according to the requirements of their state or province. The discipline of property management involves long-term planning, project management, consensus building, nurturing relationships, and conducting extensive analyses to uncover ways to save clients money. That makes it a job that involves the art of people skills as well as the science of strategic thinking. Together, that’s just the kind of challenge that many of the professional world’s most ambitious career-builders seek. An excellent property manager is backed by a strong internal support team, which helps them manage every aspect of the job focusing on compliance, preventative maintenance, safety, energy and insurance.
- Myth: The property management organization decides how to run the community. Fact: The board of directors of a community association sets the rules for the community. This elected body sets all of the policies, which are provided to homeowners at closing and are called your Community Documents. It’s the responsibility of the property management team to ensure the policies are consistently and fairly enforced throughout the community.
- Myth: All property management companies are the same. All that really matters is the manager you get. Fact: While it is important that the specific manager assigned to your community is a good fit and able to effectively execute the vision of the board, their impact could be limited if the property management company they work for doesn’t support them with staff, resources and technology. You know the difference between trying to do a job with a company that invests in your success and one that doesn’t. It’s the same for property management firms; the best ones combine high-quality individuals with a broad depth of professional resources. That way the best people can achieve their goals and provide the best service to your community.
- Myth: Hiring a property management company will make us lose control of our building and staff. Fact: Actually, the opposite is true. When you partner with a reputable property management company, you benefit from deeper resources. That means a greater ability to affect the policies set forth by the board. So by partnering with a great property management company, the result is really more control and enhanced effectiveness.
- Myth: Property management companies hurt your bottom line. Fact: The core mission of the best property management company is efficiency. They’re there to implement the board’s policies more effectively so that members can focus on the importance of policymaking. The result is always a savings of time. In most cases, the property manager will also conduct contract analyses and leverage relationships to negotiate lower fees for services, which will more than pay for the property management company’s costs. Either way – through time- or cost-savings – a good property management company will bring value to your community.
- Myth: We’ll be forced to use vendors that are partnered with the property management company, or that are owned by them. Fact: It’s no secret that these kinds of relationships can yield cost-saving benefits for communities. But the fallacy here is the idea that the property management company can force a board or a community to do anything. That’s just not the case. The best property management company will suggest a selection based on a variety of options, but the ultimate vendor decision lies with the board.
- Myth: Boards are too unprofessional to get anything out of a property manager. Fact: Most boards conduct themselves according to strict codes of professionalism. Because these are volunteer positions, members tend to commit themselves to the role with the highest standards of dedication. This involvement is enhanced further by a great property management company that helps clearly define roles, offers respectful advice and is steadfast in implementing the policies set forth by the board.
- Myth: A small property management company gives better service than the big guys. Fact: Great service is more than personalized attention. It also involves the ability to effect the positive changes you want to make in your community. And that takes resources. So when choosing a good property management firm, look for one that combines the best of both worlds: local market knowledge and national backing. That way you get real community insight, along with the leverage to negotiate contracts in your board’s favor and the resources it takes to enforce your policies fully and efficiently. Furthermore, while a smaller company is forced to operate as a “jack of all trades” to all community types, a larger firm offers specialized services based on divisions (such as master planned communities, active adult communities, high-rises, developer communities, etc.) and is thereby more suited to offer services tailored to your community’s specific needs.
Myths are fine for storybooks, but they have no place within your community or board – that’s a fact. For more information on what the right property management company can do for you, contact FirstService Residential, North America’s leading property management company.