The Property Management Show

Today, we’re giving you the inside scoop as we listen in on one of our clients, Ryan Weir, with Walker Weir Property Management in Auckland, New Zealand. We’re going to dissect one of his sales calls, received from his Google Ads campaign – an owner lead, interested in property management. We’ll listen to Ryan navigate this call, and we’ll make comments in between and talk strategy. Below you’ll see the transcript of the call. Feel free to use this topic to train your staff: Ryan: Good afternoon, Walker Weir Property Management, this is Ryan speaking. Caller: G’day, Ryan, it’s Richard here, how are you? Alex: Right off the bat, what do you hear? This introduction is what you need – he gives: the name of the company the service he provides and he gives his own name as well Train your salespeople and get in the mode yourself that you identify who you are and what your company is every time the phone rings. You want to be friendly and welcoming to the person who is calling. Ryan: Hi Richard, I’m good, how are you? Caller: Good. The reason I’m calling is because me and my wife just bought a new place down in ____, but we have that place in ______ that we want to rent out. One of the terms on our financials is to have a rental appraisal that’s around the 620 mark per week. So, I was wondering how we go about getting an appraisal for that house? Ryan: Sure. What was your last name, Richard? Caller: —— Alex: Here’s something else to notice right off the bat. Ryan is patient and he’s listening. He’s not interrupting and instead of going in to ask some questions, he’s going to identify the person and get the contact information prior to gathering more information. Let’s keep listening. Ryan: Did someone pass our details on to you? Caller: I found you on the internet. Ryan: Perfect, okay. Where is your property in _______? Caller: It’s at _______. Ryan: And you’re moving out to ____ did you say? That’s pretty exciting. Caller: Yeah. We thought it’s a good time to make a move and get some land. Ryan: And will you be enlisting the services of a property manager such as ourselves? Caller: I think that’s the goal, possibly. We will want someone to look after the place. Ryan: The prices for rental property do change a little bit throughout the year. Auckland is a bit seasonal. So, when are you relocating out? Caller: February. Ryan: Cool. As it happens, that’s a good time to rent properties. The prices are good, and there are more tenants to choose from. Can you tell me a little bit about your _____ property? Alex: So, what Ryan did there is pretty brilliant. If you noticed, he asked how did you find us. The prospect said the internet. So, that’s a good bit of information. You don’t have to dig too deeply into it. Your digital channels should be aligned, and you should be able to go to your LeadSimple software to track and capture those details. You don’t want to move the call away from its purpose. But this is a good initial bit of information. Then, Ryan did what we always recommend and train – he said “tell me a little bit about your property.” People are emotionally connected to the homes they live in. Now that they’re renting it out, they want to know that you’re interested and that you care. It’s a great question to use when you’re jumping into the discovery phase. Caller: Well it’s three bedrooms, one bathroom with a separate toilet. We bought it about three years ago, and it was an old hoarder’s house. I own a building company so we renovated it. There’s a new bathroom and kitchen, it’s insulated and painted. Obviously, we planned on living there for some time, so we didn’t want much wrong with it. Ryan: Does it have a garage? Caller: Yes, a large garage. It’s sort of a single plus workshop garage. It sits on a large property, about 680 square meters I believe. There’s a private courtyard in the back that’s fully fenced. There’s a heat pump. It doesn’t have an HRV. Ryan: I can look at some details online, but I always like to hear about it. Caller: Yeah, the online pictures just don’t do it justice. Ryan: Sure, if you’ve renovated it, I’m sure it’s quite nice Caller: Yes, we have a concrete driveway that goes all the way up and a footpath. It’s all groomed. Ryan: I’ll do some work on that and I can give you a call back tomorrow with an appraisal. Caller: Perfect. Ryan: And we can give you an appraisal that is satisfactory for the bank. Alex: And at this point in the call, most people would simply give up. You have the address and some information about the house, and you’re going to give this person an appraisal that’s required by the bank for a new home they want to buy. Most people would say goodbye and get back to them the next day. But, Ryan doesn’t do that. He continues. Ryan: It goes without saying that we’d love to manage the property for you, but we can keep in touch about that. What’s your email address? Do you have any idea about what we do here? Caller: Well, what kind of r

For this episode of the Property Management Show, we provide answers to sales questions about growing a property management business. This was done as part of a live segment at the recent PM Grow Summit in West Palm Beach. Along with Alex Osenenko, we bring in three experts who have already built high-growth property management companies, or have closely tied experience within the property management industry: Deniz Yusef – Gained 900 new management contracts over a 4-year period. Mentors agents across the United States, Australia, and New Zealand as The BDM Coach. MaryLou Tyler – Founder of Strategic Pipeline, a Fortune 1000 outbound sales process improvement consulting group. She is also the author of Predictable Prospecting: How to Radically Increase Your B2B Sales Pipeline. Jordan Muela – CEO of LeadSimple and ManageMyProperty. Co-Organizer of the PM Grow Summit. All questions and answers were compiled live at the event from real property managers. Below we have the transcription of the panel. Q. [1:54] Deniz talks a lot about live presentations and showing up to present to a client at the home. How do you modify that if you’re out of the state or even out of the country? – Bob, Alarca Property Management in Charlotte, NC Deniz: I love this question, and showing up to present to a client at the home they want to rent out is really important. If you’re out of the state or out of the country, you have to use technology. Skype sessions make it possible to do a face to face presentation if your client is not local. Book an appointment, and send your information in an email ahead of time, and then go through everything. You can’t necessarily walk around the property with the client, but there are ways to work this out. You could do this through Skype and Google Hangouts and Facetime, and you can still be face to face with your client. There’s no excuse to not getting in front of a client in this day and age. You can engage and win their business by looking into their eyes and getting in front of that client. Q. [3:26] Why go through the trouble of tracking sales activities if you already know the results? If I know the outcome, why go through all that hassle? Marylou: First of all, it’s not a hassle. You may know how many properties you’re closing, but it still matters that you track that activity. It’s fine tuning the process of getting from that initial conversation to identifying the opportunity and gaining the business. It helps you to close the lag time and note what pain point or challenge you could overcome for the client. Tracking sales activities can create a shorter sales cycle and helps you identify on what’s working and what isn’t. Q. [4:21] I like what Deniz talked about in his presentation and my question is, how long or how much time should be spent at a presentation when you’re at a home? – Chris, Rent Pros Property Management in Sacramento, CA Deniz: Give yourself about an hour and a half for the presentation. It may sound long now, however you want to be deliberate enough so you don’t go back and do a second presentation. It’s not very efficient to set multiple appointments for one door. Give yourself that full 90 minutes to plan and spend with a potential client. You can go to the property and do your presentation in that timeframe because before the meeting, you will have asked the important questions already. Make sure you can overcome every objection that you might hear. So, work on your presentation skills, practice, record yourself on the phone and really put together a great presentation. You’ll be surprised at how fast that hour and a half goes. Marylou: There’s a process at the front end that needs to be in place. You want to do your qualification process and keep track of the client and the property before you get to the presentation. Q. [5:56] Here’s a situational scenario. Let’s say I run a 200-unit property management company, and I do all the sales myself but I’m ready to hire a Business Development Manager (BDM). What are the first things that I do to structure the process so when that new BDM walks in, so there’s something for them to do? Simplify the first steps. Marylou: You need to immediately map out the steps for your sales process from the first conversation to the first visit, whether it’s remote or on-site. Look at the key milestones along that way so you can see the actual steps that create forward movement into your pipeline. Have those mapped out so you’ll know how long it takes, how many people you need to go through, and all the other details. That will shape the daily life of a salesperson doing this on your behalf. Deniz: Have strong systems and procedures in place in your office. Even if you are starting your property management business, have the infrastructure in place to handle growth. You don’t want to have Band-Aids all over the place because you weren’t prepared. Show that you’re prepared for the growth and the

Today, we’re talking with Brad Larsen, Founder/Owner of Larsen Properties in San Antonio, about The Top 10 Property Management Mistakes and How to Learn From Them. These tips will help avoid the pains of growing a property management business. We are excited to bring in Brad, who: is a retired army captain. earned a master’s degree in business administration. runs a property management company in the ultra-competitive San Antonio property management market. Larsen Properties started in 2011 and has already emerged as a market leader in the San Antonio area. Brad will share 10 mistakes that he wished he had known about when he first started Larsen Properties. #10 – Waiting Too Long to Hire Business Development Talent Larsen Properties waited until they reached 250 homes under management before hiring a business development manager for their company. Brad was first introduced to the idea of hiring a business development manager from the Leading Property Managers of Australia. This is one of the first things you must do if your intention is to grow. As a business owner, you are doing so many things from payroll to operations that you simply cannot commit to dealing with 4-5 appointments/week. Also, Brad recommends on not waiting too long in implementing a solid CRM platform, like LeadSimple, to systemize follow-ups to help your property management company. Combining those two areas will help your business development manager effectively do their job, as well as you being able to passively oversee the activity that is going on with your lead generating efforts. Think about compensation as well because your model needs to be sustainable. Do a base salary and a percentage or a commission based on the lifetime value of that client. You want a motivated sales person, not a converted Realtor. A great tip to convert a higher rate of deals is to consider having a portfolio manager go with your business development manager to appointments so that the potential client can meet the person who would be their point of contact. That helps a conversation start about tenant handover procedures, what will happen to get a home ready for the market, etc. Speaking the language is important, and the prospective owner will appreciate talking to someone who will actually manage the property. Larsen Properties recommend that 100 homes is when you should start to seriously consider hiring a business development manager. At that point, you have more than enough to manage and you have enough income coming in from management agreements that can help you pay for that talent investment. #9 – Not Establishing Metrics Early Larsen Properties started a spreadsheet a few years ago that helps them track metrics Track your metrics religiously every month. You can make adjustments quickly and discover where you are spending incorrectly. Key performance indicators (KPIs) that Brad likes include: Staffing to revenue ratio – staffing expense costs compared to annual revenue. The magic line in the sand is around 50 percent, and it might fall between 40 or 60 percent. If your total revenue is $1 million and your staffing expense as $500,000, that’s half of your revenue spent on staffing. It’s where it should be. Smaller companies can run their staffing at about 40 percent. If you’re above 60 percent, you want to look at that metric and see if you’re spending too much on staff. Sundry income to management revenue ratio. Sundry programs are small programs like eviction protection, early termination fee, late fees, rental guarantees, and any other things you may have against your management fee revenue. In Australia, it’s tracked at .25. So, for every management dollar you earn, you could/should be earning an additional 25 cents of additional revenue. At Larsen Properties, they’ve managed to earn 70 cents on every dollar above and beyond their management and leasing fees. Pro-tip: One of the ways Larsen Properties is able to earn 70 cents on every rental revenue dollar is by charging a pet administrative fee. That covers the property manager’s ability to cover any damage that a pet causes above and beyond the security deposit. It’s a creative way to earn that sundry income. #8 – Not Joining NARPM Right Away It took Brad 2-3 years before he got really involved with NARPM NARPM – the National Association of Residential Property Managers – provides resources, leadership, and mentors. A lot can be learned at broker-owner conferences and other events. You learn how your peers solve common problems in innovative ways. Check out NARPM.org if you’re not a member yet. There are state chapters as well, which provide excellent speakers and opportunities. You also get face time with vendors, which helps you get to know the people behind a product/service. #7 – Not Establishing Enough Points of Difference You need to create some points of difference between you and other companies. It should be easy for you to attract a

Our guest today is Jason Goldberg, who is a life coach, international best-selling author, a speaker, and just a great human being. Subscribe to The Property Management Show on iTunes Q: I have your book here, Prison Break, and let me set the stage for this podcast. I want to use our time today to get some deep wisdom in a fun and non-pressure environment. I also have a selfish purpose here, and this is it: for the last six months or so, I’ve been looking for a business and potentially a personal coach to help me and my team elevate to the next level. I’ve never done a coach interview for myself, so I’m hoping to use this as a discovery mission. Hopefully business owners in my shoes right now who need inspirational leadership from a coach can find this to be a helpful tool. How does that sound? A: I love that. The only thing I care about doing in life is being of service, so let’s create an intense and massive service for you and your listeners. Q: I’m defining service as the purpose of life. It’s such an immense satisfaction when you serve someone other than yourself. A: Yes, but serving others is the most selfish thing we can do in the world. Anyone who tells you they serve others out of the goodness of their heart is lying. The reason being is we can’t help but to feel good about ourselves when we help others. And that’s okay – there’s nothing wrong with contributing, making the world better, and feeling good during the process. It’s an incredible feeling. Q: You have coached a lot of people, and you have this element of knowledge where you can look inside someone’s brain and help solve their problems. How do you help business owners define what they want? It seems like such an evasive thing. I don’t even know what I want. How do you help people do that? A: Trying to answer that question becomes this intellectual exercise and one more thing to do on the to-do list. I am a fast person, and one of the biggest transformations in my life was to slow down. That doesn’t mean you don’t still work hard and hustle and do a lot of stuff. I still do a lot. But what I do differently now is I don’t allow the outside chaos of the world to impact the inside chaos of my mind. When you ask a question like “what do I want?” – if you’re trying to answer it from the head space of needing to figure it out, it won’t come. It can’t be pressure-filled and serious. Settle and slow down your thoughts, and mentally close your eyes to visualize it. Picture a snow globe with a base and a glass and all the fake snow and liquid swirling around. When you shake up the snow globe, it’s beautiful from the outside. People love it. But think about it from the inside looking out. If you were inside the snow globe looking out, you’d freak out. You can’t see anything except the swirling flakes and liquid, and you just want everything to slow down. So, we are inside the snow globe and in that place, we can’t answer the question – what do I want? You can’t see the possibilities. You need to let things settle. Q: What is it? How do you settle down a snow globe? A: You have the snow settle by putting the snow globe down and stepping away. When it’s not being agitated, it’s calm. So once everything is calm and the snow settles, you’re inside this glass globe and you can see all the possibilities. When you’re wondering what you want, don’t answer from a place of chaos, but look inside, and settle down and allow yourself to figure out what you want. Look at it through a different lens. Q: But you have to be purposeful in terms of looking for that answer. Putting things down feels like things are going to be ignored. I’m walking by the globe, but not paying attention. A: Anything I know is from screwing up. So, you may think you’re walking past the snow globe and ignoring it, but you’re still in the chaotic mind space. Once you slow down, you can figure out what it is you want. Ask yourself what your ideal day looks like. Just an ordinary day, not an amazing day. This is everything from morning routine to how much time you spend with your family to the time you have for exercise or reading to what you do with members of your team to develop them to the time you’re out in the world to your at-home time and the meals you’re eating and the time you go to bed. All this really matters; you have to figure out what your ideal average day looks like. It’s a great first exercise, but the real thing that transforms business leaders is to look at that and decide who they need to be in order for it to be the average day. Who do I need to be? What do I need to cultivate to make that happen? Is it more courage, creativity, empathy, presence, what is it? Everyone knows what is holding them back. That’s something everyone knows, they just don’t give themselves the time and space to figure it all out. Q: One of the most influential people in my life is Albert Oaten, who was a VP at a company I worked for. He was amazing at this one concept. He always asked “what does

Today our guest is Deniz Yusef, who trains business development people in Australia’s property management industry. We are definitely lucky to bring him on board; to date, we haven’t run into anyone like him here in the United States, or even elsewhere in the world. Preconceived notions may have you thinking that you first need to get leads before you hire a business development manager, however, that is not the case. In this interview and article, you will learn: 4 new lead sources a BDM can bring to your property management business. Common blockages BDMs uncover when it comes to leads. How to incentivize a salesperson or BDM to sell beyond their sales goals. The big mistake owners make when employing a property management business development manager. Listen to the interview above, or read the transcript below, and learn all that you need to know about Business Development Managers for your property management company.   When to Hire a BDM or Salesperson for Your Company Q: One question I get a lot is: when should I be ready to hire a business development person or a sales person to sell my property management service? Is it 100 units? 800 units? What’s the answer you usually give? A: Well, I usually ask, how serious are you about your growth? You can have a business development manager with no houses under management. Right now, I’m working with some people who are in Bali, trying to grow a rent roll in Australia. So, they will work remotely and hire a business development manager in Brisbane. He has zero houses under management right now. There’s no magic number really, it’s interesting to see what the goal is. Some people have started with six properties under management and the goal is to get to 38 or 40. It’s one of those questions that’s hard to answer because there are a lot of different variables to consider. How many properties can you manage? It depends on your backing and your assistance. So, there’s no real number to put on it. If you’re serious about growth, you need to be over-staffed to be prepared for that. Q: A salesperson, in my opinion, is an asset to the team. They bring in a lot more than they consume. So, what would be the trigger or the number of units with an average management fee of $125 per month that the salesperson needs to bring in every month to justify their existence? A: Well, this comes back to the average income that each unit is bringing your office. So, if you’re only averaging $1,500 per year in income, you’d want a minimum of 10 units/month to cover their wage. But again, it’s what your overhead is and what you can afford and who you can employ. Some companies will employ someone at a minimum wage and give a higher bonus. They are happy to wear the costs for 12 months. It’s a tricky question. Some people, if they get six new units a month, they are happy. I am preparing to train someone who is already leasing 28 units/month and they have employed me just to push them to 30. Background on Deniz Yusef Q: You had an interesting career path to get to where you are. Can you talk about your experience? You were the top business development manager in the nation. A: I had no education or training in sales. My background is in hospitality. I worked in restaurants and moved into fruits and vegetables. I was a fruit vendor. My wife and I thought about traveling to America for two years with our two children, and then we got pregnant with our third child, so we didn’t travel. That’s when I moved from fruits and veggies into real estate. I was the leasing agent and then I became the business development manager after nine months. My job was solely lease management and growing the business. In essence, I took on the attitude of doing it like fruit and veggies. I knew how I got new clients for fruit and veggies, and so that’s how I approached it in real estate. I listed just over 60 managements in my first year. Q: Just to convert to our US terminology, you basically sold 60 management contracts? A: Right. We call it listing and I think you guys call it ‘getting a door.’ So, I got 67 individual doors that were then converted for management. That was securing the management contract. I learned a lot from my mistakes. I didn’t know how to sell the property management part. I reduced the fees because I didn’t know what I was doing. So, in my second year I sold 191 doors. The next year, I was up to 237, and my goal was to beat what I did the year before. I had a white board with all my numbers. I went to 317 the year after that, and I was averaging 34.5 doors a month. I was tired. Q: You worked for another company? A: Yes, I made my bosses very rich. That was 926 units total in four years or 48 months. The KPIs – Key Performance Indicators – had specific targets to reach and tasks to do, including follow-ups and a contact management system. I know you have a great contact management system with LeadSimple. I would have loved to have LeadSimple when I was

Alex is coming to you from the 2016 Annual NARPM convention in Maui with: Jordan Muela as the co-host; CEO of LeadSimple. Michael Monteiro, the CEO of Buildium Andy Propst, CEO of HomeRiver and past national NARPM president Our topic is the state of the property management industry, and we want to talk about how small to mid-size entrepreneurs can compete in this space over the next five years. Subscribe to The Property Management Show on iTunes Today to Stay Up to Date on the Latest Episodes Outside Capital In the Property Management Industry Alex: Let’s start with a tough question: at this stage, there is a lot of outside capital flowing into the industry. How do you think this shift will affect the competitive abilities of the small to midsize entrepreneur? Michael Monteiro: I think the same way that smaller independent companies have competed with better-funded companies since the beginning of time. It’s important for the property management company to first figure out how they are going to be different in the market. What will they be better at than anyone else, and what will they be known for? I think that’s how property management companies will compete with larger, better-funded companies. It might mean specializing in a specific kind of rental management or providing outstanding customer service. They need to be clear on their ideal customer and deciding what they want to be known for. Andrew Propst: I agree with that, and having their own story will make a difference. With larger companies, the story gets lost. A smaller company can go out there and share their story about how they got to where they are. They have an opportunity to connect on a local level and be meaningful. That will help them stay ahead. And it’s a great question; a lot of this is happening. Finding an identity and getting the message out there is important. On Branding for Property Management Companies Jordan: Doubling down on niche and brand, I know you both run companies where branding is a priority. Was this important to you from day one, or did it grow over time? How did your evolution happen? Andrew Propst: For me, branding was a priority from day one, just because with my personality, I care what people think about me, and I couldn’t differentiate my brand from who I am personally. We looked at our mission statement and we wanted our brand to represent our mission. I wanted to have the same message throughout our brand. We don’t think of our brand as the logo or anything like that. It’s how the public perceives us and what we do. I want that to be a good message. The brand is important and has been since day one. Michael Monteiro: I’m not sure we thought about it as brand 12 years ago, but it was important for us from the beginning. We wanted to be clear on how we would be different. Our market is competitive, and we have larger and better funded competitors in our space. But we decided early on that we would be laser focused on one property management vertical. We decided we would be laser focused on small to medium sized property management firms. And, we decided to be laser focused on residential property management. So, I’m not sure we thought about it as branding back then, but it is something we thought about in the early days: “where will we stake our claim?” That has helped us succeed in a competitive market. Where Should a Small Property Management Business Invest Time? Alex: What specific things would you advise these smaller companies to invest their time in? If they want to zero in on the perfect customer and building a brand that makes the business as attractive as possible to these folks? Michael Monteiro: We call that the ideal customer profile. The better and clearer you can be on your ideal customer, the more successful you’ll be. In property management, we hear all the time that people will take on any clients willing to hire them. Be clear on your ideal customer, and resist taking on anyone who doesn’t fit that. Andrew Propst: There are a lot of rabbit holes in property management, too. It’s a great business, and it’s a tough business for an entrepreneur because it opens so many different opportunities and avenues. So, it’s important for people good at property management to decide where to serve. There’s commercial and multi-family and real estate, but the people who run the best property management companies have the ideal customer in mind and they focus on what they do best. Then, they can do a good job growing their business. Alex: So, having a clear focus and understanding the opportunity cost of having a squirrel mentality? Andrew: Yes, there are a lot of squirrel opportunities in this business. If you don’t believe me, walk down the trade room floor. You could leave this place with a thousand different opportunities. Most property management companies don’t go out of business, they die of too many opportunities, which causes problems. Situational Property Management Issue Jordan: You

Our guest today is Andrew Warner. He runs a very popular podcast for entrepreneurs called Mixergy. If you want to learn everything that you need to know when it comes to business, you listen to Mixergy. It’s not Andrew teaching the wisdom of his ways, it’s Andrew interviewing all the top names out there. Some of his interviewees are: Tim Ferriss of the Four Hour Work Week Barbara Corcoran from Shark Tank Jessica Livingston of Y Combinator Brian Chesky and Joe Gebbia of Airbnb Gary Vaynerchuk Neil Patel and many others. There’s some significant wisdom locked in Andrew’s head that we’re going to try to unpack a little bit, specifically for our property management tribe. Below is a transcript of our conversation: Q: The concept out there is that 20 percent of the work brings 80 percent of the results. You said, and this is a quote: “when you build a start-up, the secret of success is to understand what that 20 percent is, and pay attention to it.” So, what is that 20 percent for you, Andrew? A: For me, the 20 percent is a handful of things. One of them is to talk to my customers and my audience a lot more. Anyone who is involved with or excited about what I’m doing is someone I need to talk to as much as possible. At first, I thought online research was enough, but I discovered it’s about finding ways to get people on the phone so I can talk to them and understand what they’re going through. I had been hearing that the founders of Airbnb went and lived in their customers’ homes and saw what it was like to list on the site. They wanted to understand the problems people might have. So they realized Airbnb shouldn’t be about just renting a room, but the whole house. They only discovered that when they got into a house. The thing is that it always seems so easy when you’re told to go talk to your customers. I tried doing this, but no one picks up the phone and no one wants to schedule a phone call. That creates more work for them. It took a lot of creativity to learn what my customers are going through. Q: What were some of the creative ways you learned your customers go through? A: Here’s one: I didn’t say I want to learn from you so I can improve my product. Instead, I emailed them and said thanks for being a part of my community, I want to give you a free coaching session. With free coaching, you’re going to find a struggle that they could use some help with. If they’re not going through something, they won’t take me up on it. But if they are going through something, they’re going to take me up on that offer. Once I get on a call with them, I can talk about what they want and why they signed up. They will always tell me about that one issue that they need help with and want to focus on with their free 15-minute coaching call. Then, I could understand the real problem and solve that problem or help them come up with their own solutions. More importantly, I could understand the problem better and build the solution into my interviews and everything we stand for at Mixergy. Q: That’s pretty brilliant. A: I know it won’t work for everyone, but it worked for us. The key that I’d like anyone to take away is that we want to learn from our customers what to create for them and how we can improve, but it’s a challenge to figure out how to get them on the phone. If we call them and they don’t pick up or we email them and they don’t respond, it’s not because this doesn’t work. We shouldn’t stop. Just spend some time figuring out the one thing that will work. When you figure it out, they will tell you what they need. When they tell you about the one desperate problem that they have, if you can address it even a little bit, they will be happy customers. Q: I spoke to Lisa Wise, who is running an incredible property management start-up in Washington D.C. called Nest and it’s transformational. She built her office inside a typical house that these guys manage. So the employees can touch everything that would be in a house. They know how the heater works and what happens when the air conditioner goes out. This build empathy for their customers. It accomplishes two things: It shows you how to build your product and where to go with it, and it also builds the empathy you need to transform your services. A: That’s incredibly helpful. Can she get people into the actual homes? If they can get invited to dinner or in to repair something, it would be incredible. Advice on Pricing Q: Sure. You could shadow your maintenance guy and see how tenants feel. There’s something to learn there. Within the last year, I’ve been fascinated with two things: pricing and unit economics, and how they impact the business. You recently spoke to Patrick Campbell with Price Intelligently. You mentioned something that might be useful for everyone here. You have used a tool to figure out your pricing and your revenue. Can you talk about that a little? A: Profit Well is one of his products, and I use it to get a sense of who is buying from me and what they

Subscribe to The Property Management Show on iTunes Today to Stay Up to Date on the Latest Episodes Our topic today is business process outsourcing for modern property management companies. My guest is Todd Breen, who has a wealth of experience in a couple of areas. He has been running his company – Home Property Management – for 30 years, so he has the broker and business building experience from the perspective of a broker and property manager. His other venture is called VirtuallyinCredible, where he does video tours, training, and international speaking. He also does business process outsourcing. Q: So Todd has the applicable knowledge on how outsourcing helps grow property management companies. My first question is the hard one – in the realm of property management, how will people know they are good prospects for potentially outsourcing work and saving money? A: I get that question a lot. People always ask if they should outsource and what type of work should they outsource. The first thing I like to do is put up a scale. On one end are the control freaks who like to micromanage every process of their business. At the other end are the people who tend to fly by the seat of their pants and are trying to get the job done. They have no systems and no processes. So we help a company decide where they are on the spectrum. As soon that’s determined, I can provide some insight on what it will be like to outsource and how their needs can best be met. So if someone has a tightly run operation with lots of systems and process already in place, they will be able to pass everything that’s in place onto us. Those people can be good outsource candidates provided they devote a lot of time and attention to learning the cultural differences in the Philippines or India or any other place that we outsource. They have to adapt a little to that culture. Half the battle is done because you already have your system and your training in place. You’re just bringing someone in from across the world. It’s not a big deal and they work virtually. The people who have no systems or procedures should outsource after learning how much easier it is to let someone else do the work for you. They need an intermediary, and that’s where we come in. We establish those systems because the more systemized you are when hiring your virtual assistants, the less systemized you need to be when you outsource. Q: So this works for a tightly run business with systems and management practices, who can hire talent from overseas for a lot less money to complete the tasks. Then, their more expensive talent can spend more time on value-added tasks than the menial data entry things. And it works for the folks who have no system, because you work with them to systemize and execute. Is that right? A: Yes. It also depends on the size of the business. We know the larger the business, the more likely they are to have proven systems in place. When I see a company with 150 doors or fewer, I know that those are the entrepreneurial owners who are newer to the process and struggling to put together all their systems. Our best client at VirtuallyinCredible is the company with 250 units or less who is thankful for the affordable help in systemizing processes in their business that they didn’t know how to do. Q: So Business Process Outsourcing (BPO) companies are everywhere. You can buy their services for any business. The advantage of working with a property management centric business like VirtuallyinCredible is that you get help with the actual data entry and PCR reports or whatever, but you also get help systemizing and doing things efficiently, securely, and with deliverables. You help them systemize and execute. A: That’s what happens. It’s such an “A-ha” moment when we do a presentation to a smaller business owner. They thought they were just getting labor help, but that comes with a built-in system, and it’s better than anything they’ve done. It works. As we go to 250-500 size companies, they have already struggled to create their own systems, and now it comes down to deciding which system is better – theirs or ours. Smaller businesses are grateful we’re here. Medium sized businesses require some communication. You have to fit well with the existing staff and handle turf battles with staff who may resist any changes. It’s a dynamic about bringing outsourcing to a medium sized business that is a bit artful. Not everyone is comfortable outsourcing. Q: There are definitely negative connotations to outsourcing work to other countries. I think people have pre-conceived notions without necessarily understanding what the true concept is. Let’s explore the ROI. You said that a higher end property management company has to learn about different cultures to build in the processes. What amount of outsourcing do they need to do to get a good return on their investment if they’re putting in the time to get to know new cultures and time zones? A: When I talk to someone

Our guest today is Lisa Wise, who is with a company called Nest DC. As we go through this show, you may want to visit nest-dc.com to get exposed to the actual website so you understand Lisa’s company and what they are all about. Subscribe to The Property Management Show on iTunes Today to Stay Up to Date on the Latest Episodes I came across Lisa’s website by accident while we were doing a property management webinar with LeadSimple. Her page was assigned to me for conversion optimization advice. As I was reviewing other websites, I stumbled upon Nest, and I got a great tour of that website. I liked how it looked from site aesthetics to their 6-minute promo video. I wanted to meet the person behind the company and talk to her about what it took to build Nest DC and where she’s going with it. Q: So on the last podcast I heard you on, which I think was Executive Leader Radio, you mentioned that you are at about 500 properties. That was about 10 months ago. Where are you right now? A: We’re in the same place right now with Nest DC, but we have spun out our portfolio and separated the residential management side of our work that falls under the umbrella of Nest DC. Our association management is no longer in that portfolio, and is now managed under Roost. So, we’re still growing and building out new opportunities for revenue streams. We’ve tightened up the portfolio so we can really focus on different specialties with the two different companies. Q: So Roost is also your company? A: Yes. Roost DC is an outgrowth of Nest. It’s a sister company. Nest has become a success because we’ve had an exceptional team. Without our staff, we don’t have anything to offer that’s out of the ordinary. I have put together a loyal, fun, sophisticated, and motivated team of people that have made this company thrive. So one of the things I wanted to do was to reward those team members with an ownership opportunity, to really feel like their stumbling upon Nest was a good, once-in-a-lifetime opportunity. Rather than splitting Nest up, which would have been logistically complicated and less prudent, we took the associations we were managing out of the portfolio and we spun that work out into a new company called Roost. Roost DC is an LLC with 11 owners. All of the Nest employees were invited to become shareholders. Eleven of them did, and we are not aware of any other employee-owned management company that is not a family. Q: Very impressive. So I am a big proponent of making sure that employees are happy. Happy employees make happy customers, and that is the perfect world. What you guys did is pretty amazing. We have a standard and generic offer like most technology start-ups where we offer options to our employees, but you actually made a company for those committed to the cause. I have met thousands of property managers in my career and I’ve never seen anything like that. How is it working for you and how long have you been doing it? A: We’re approaching the end of our second year of business with Roost and it’s been one of the best professional decisions I’ve made. I’m proud of it. One of the great things about working with colleagues who are also co-owners is that you’re getting real buy-in and commitment. There’s a focus on high-quality customer service, attention to the brand, teamwork, and a level of focus that you won’t get from an hourly employee. You can reward them all you want, but when an ownership is at stake, it really lends itself to a different customer experience, and it’s been great for business. It’s been fun to work with team members who are co-owners and it’s created a different experience for our customers. One of our chief complaints we get in the association environment is that there’s a lot of turnover. And when you’re a team of co-owners, that variable goes away. Q: When you say turnover, you mean employee turnover, right? A: Exactly. Traditional portfolio management brings a lot of turnover, and some of the buildings we work with get frustrated if one to two different managers are their point of contact annually. It’s hard to maintain the institutional knowledge that you need to manage well. Q: I couldn’t agree more. The continuity and progression of a team is paramount in a service business. I model a lot of my back end organization after the most successful property management companies I work with. The team needs to be responsible for their portfolio of clients. A lot of things can be done on an assembly line, but when it comes to relationships, it’s not assembly line work. People need to be connected to individuals making customers happy. Before becoming a property manager, what did you do, and how did you get into the property management business? A: I was a policy consultant for a healthcare organization and then moved into senior leadership roles where I was the executive director for healthcare or environmental nonprofits. I segued into that after graduating with a degree in political economy and be

This talk was an interesting one as we were able to corral a long-term customer in Steve Rozenberg to join us for this interview. He’s a commercial pilot for United Airlines, and he also runs one of the fastest growing property management businesses in Empire Industries located in Houston, TX. He shares his story in how we grew Empire Industries into the power that it is today. Below is a transcription of the interview: Q: Steve, welcome to the show. Can you give us a quick introduction of who you are and what you do? A: Thanks for having me. I live in Houston, Texas and I was sort of backwards in getting into what I’m doing now. I never wanted to be involved in real estate or thought about becoming an entrepreneur. I was thrust into the world because of a day that a lot of us remember, which was September 11th. I’m what people call a 9/11 entrepreneur, which means for me that day dramatically affected my life and my livelihood as an airline pilot. That safe, secure job that I thought I had as a pilot really ceased to exist on September 12th. Being an airline pilot is really specialized, and I didn’t want to find myself out of a job and on the street. I was luckily able to keep my career – I’m still an airline pilot. But hundreds of thousands of planes were grounded for the week after 9/11, and that was my “why” moment. I decided I wanted to start learning about real estate. I began buying single family homes and then apartment complexes. Q: So you got that jolt to your life and your career, and you thought that real estate would be a good way to have your money in something physical; an asset that’s not likely to disappear. Did you use a property manager when you began buying properties? A: No. Q: Why not? A: I didn’t know a lot of the things then that I know now. It’s one of those things that you think you’re smart enough to figure out on your own. Real estate is a safe and secure investment, but as an investor, making the wrong acquisitions without the right business model can take away that security quickly. I bought some properties without the right property management structure in place, and if you don’t know what you’re doing, it can be a financial disaster. Q: So the question is, how do property managers convince people – a starting investor – to think along the lines of getting help right away to avoid losses and failures? A: It’s a matter of educating them. You don’t want to tell people how good you are at property management. They don’t care. What’s important is finding out what their goals are, what they want, and how you can help them realize what they don’t know while they’re achieving those goals. So many things can happen with tenant rights, fair housing, and discrimination. Landlords are often sued because they don’t treat their property like a business. I always tell investors: you are playing with people’s lives, and that makes you liable and responsible. The IRS and the Texas Property Code and the Fair Housing Act says you’re a business. Once they start seeing it that way, they know a property manager is a necessary part of the team. It’s my job to explain how we will get them to their goals. Q: Knowing what I know now, I will never get into an investment property without first consulting and working with a property manager on the acquisition, management, and eventual sale. You are right when you say education is what’s needed. Listeners, if you go to the Empire Industries website – empireindustriesllc.com, you’ll be amazed at how many videos and books are available. If you are looking for resources and answers, this website is it. This is why Steve wins all the business. It’s education. So let’s step back a bit, how did you end up as a property management company? A: I met my business partner in a real estate investment group in Houston and we partnered on an apartment complex. After we sold the apartment complex, we took the revenue and bought some houses. We bought 20 single family homes in about a year. We bought the wrong properties. Q: What was wrong with that portfolio? A: About 70 percent of the properties we bought were in low-income areas. They weren’t bad properties, just wrong for us and the business model we were using. Our cash on cash return was high on paper – around 60 percent. We bought the homes for $50,000 or $60,000, and rented them out for $900 or $1,000 per month. But with low-income properties, what we didn’t know and what a property management company would have told us, is that our average tenancy rate was eight months. Our turnover costs were three times our other turnovers. So the tenants didn’t stay and the maintenance costs were killing us. That sucked up all our revenue and we did not account for that. At that point, we tried to hand the properties over to a management company, but we couldn’t find one that would agree to work with us. That’s when we realized we did something wrong. This was in the middle of the 2008/2009 recession, and we were stuck

If you are thinking about starting your own property management company, or looking to improve processes and organization, you will need effective property management fee structures in place so you can continue running your business that’s fair to you and your clients. Having a pricing structure for your property management company will not only help you understand the cost of running your business, but it will also help you plan ahead and make sure that each rental property is handled professionally and with consistency. Our special guest today is a property management coach – literally. She’s Kathleen Richards, “The Property Management Coach” and she provides guidance to other property management company owners on topics like this to help them to be successful with their business. She is also the broker/owner of an award-winning property management company in Santa Cruz, California – Portola Property Management (Update: Since this article was published, Kathleen has sold Portola Property Management). We felt that someone with her pedigree would be perfect to talk about setting an effective pricing structure for property management companies. The Different Pricing Structures for Property Management Companies If you’re a new company starting out, and you’re growing your business organically, (versus buying a property management company that might already have a pricing structure in place) look around and see what your competitors are doing. Figure out how you can differentiate yourself. Here are some of the common pricing structures that property management companies use: Flat-Fee Pricing Structure Sometimes property management companies charge a flat-fee, and for new property managers that may be a great way to go. You can build your business quickly that way; just make sure you don’t over-commit to all the things that will fall under that set price, otherwise you’ll be doing a lot of work for free. A fixed property management fee is easy for a property owner to understand when hiring a property manager. Percentage of the Monthly Rent Another common type of property management fee is to charge a percentage of the monthly rent of the rental property. To help decide what will be a good range, research what other local property management companies charge, and maybe charge a percentage at the low end or below that. That way you’ll get people’s attention and be more competitive. Hybrid Then there are hybrids where you charge a percentage as a monthly management fee, and then you have other value-added services with set prices. That way, you only charge extra when the rental property owner needs that service. Examples of add on services may include tenant placement fee, early termination fee, and/or a lease renewal fee. It all depends on how much your property management company charges for the initial fee, and the exact services rental property owners in your location want. If You’re Buying an Existing Property Management Company If you’re buying a property management company with an existing price structure, but the prices are lower than you’d like to charge, you have to make changes strategically. Maybe you maintain those prices at first, so the existing clients can see how great you are. Then, you educate them about what you do differently, and roll out new services or start increasing prices gradually. Changing Property Management Fees: Kathleen’s Story When Kathleen bought Portola Property Management 15 years ago, the pricing model was a single price with everything included. After a year, she communicated clearly what the property management fee really covered, and what it didn’t, and started charging separate fees for uncovered value-added services. That allowed different revenue streams to develop. Then, after a time, she offered a Classic/Deluxe/Premium pricing model. The effectiveness of these models depends on your market. In a metropolitan area like in Silicon Valley, it’s great, because people are more likely to go for Premium. They are busy and they don’t want to deal with property management. However, for residential property managers in a smaller market, people may be more price-conscious. Kathleen found that clients kept choosing the Basic price structure. As different services get requested, they would just pay for them as needed. However, it wasn’t very economical for her to have three different monthly fee options when everyone chose the same option. Property Management Pricing Structure in Smaller Markets Kathleen revamped her pricing setup fee structure once again to increase the property management fees. She raised her standard price to what used to be the premium level, and included some of the services most people had been paying for as a value-add. This new fee structure has made things simpler on her end. For example, there was an option for rental property owners to receive a preventative

Our special guest today is a property management guru and the property management coach – literally. She’s Kathleen Richards, who owns a business called The Property Management Coach. The topic we’re talking about today is pricing structures. Our customers always ask how to set up pricing. Q: Kathleen, can you give us a quick intro and tell us about what you do? A: As you said, I am a property manager and I own Portola Property Management in Santa Cruz, California. We are an award-winning company, and I’m an active member of NARPM. I’ve been involved with different conferences and I’ve served on boards at the state and local levels. I also have a coaching business called The Property Management Coach. I provide guidance to other property management company owners on topics like this and I help them to keep up with their businesses, showing them where to focus their attention and how to be successful. Q: We all need help and coaching, and someone to be the guiding light for decisions we’re making. Even if we make the right decision, we need to figure out how those decisions impact our business. How do you address pricing? A: If you’re a new company starting out and you’re growing your business organically versus buying a company that might already have a pricing structure in place, look around and see what your competitors are doing in the area. Figure out how you can differentiate yourself. Sometimes people do a flat fee and for a new business owner that may be a great way to go. You can build your business quickly that way, just make sure you don’t over-commit to all the things that will fall under that set price, otherwise you’ll be doing a lot of work for free. It’s also common to do a percentage of the rent. You need to decide what will be a good range. For example, if in your area you find out by doing your own research that all you competitors are charging X amount, maybe you charge a percentage below that. Then there are hybrids where you can charge a percentage for the monthly management and then you have other value-added services with set prices so when the owner needs that service, you charge at the time the service is provided. If you’re buying a company with an existing price structure but they’re lower than you’d like to charge, you have to make strategic changes. So maybe you keep the prices at first so the new owners can see how great you are. Then, you can educate them about what you do and then roll out new services or start increasing prices. Q: What about the concept that has been working well for technology businesses and is making its way into service businesses where you can have different service levels and prices: Good/Better/Best. The Good level is something low priced just for management and then Better and Best packages offer more and also cost more. Does that structure work? A: I did that myself. I bought a company 15 years ago that had one price with everything included. After a year I uncoupled it and I set out clearly what the management fee covered, and then I started charging separate fees for value-added services. That allowed different revenue streams to come in. Then over time I offered a Classic/Deluxe/Premium pricing model. I think that works well depending on your market. If you’re in Silicon Valley, that’s great, and people will always go for Premium. They are busy and they don’t want to deal with property management. But in a smaller market, that’s maybe more price consciousness, and I found that everyone kept choosing the Basic price structure. So that’s the entry level price and as you want different services, you just pay for them as needed. That worked in my market. But it took a lot to have three different options and have everyone choose same option. So I revamped again and increased my management fees to be more premium based and I threw in some of those things people had been paying for. One example is the preventative maintenance check on all our properties. We allowed owners to opt in or out but that caused a lot of logistical problems. So we decided that everyone would have that service. It’s included as a freebie and helps us validate our higher management fee. We still have certain services that we pay for on a per price basis. So I have a bit of a hybrid. Q: I love the opportunity to earn our customer’s business at a lower level and you have the opportunity to upsell. It’s a win-win, and the relationship is healthy. The biggest reason why a landlord doesn’t hire a property manager is in their perception of the price. They cannot connect the value to the price. So offering a low price and then leaving yourself an upsell opportunity is a great way to do it. Is the risk that they will all choose the lower package? A: That strategy worked because while people do choose the lower price you can educate them about your different services. We send out quarterly newsletters about our new services. As they trust you and you educate them about different things, y

Subscribe to The Property Management Show on iTunes Today to Stay Up to Date on the Latest Episodes The topic today is how to compensate a salesperson for your property management company. If we have a chance, we’ll talk about when you should hire that salesperson and shed some light on how to find and interview and retain the best salespeople for your property management shop. Our guest is Duke Dodson who runs Dodson Property Management. He has one of the fastest growing property management companies in the U.S., and he’s uniquely positioned to talk about this. Q: Thanks for joining us, Duke. Tell us a little about your company and your story. When did you first decide to hire a salesperson? How far along were you in your growth trajectory? A: I started my property management company in 2007. It was just me, so I was the business development person and the salesperson. When I got to the point that we had 300 units under management, I hired the first salesperson. Q: Do you mind if I stop you and ask how long it took to get to 300? A: It took about three years. I decided to hire someone because I was a good salesperson but not a great one, and I was doing business development and sales 10 to 20 percent of the time during the day. I knew if I could find someone to do it better than me full-time, I would grow. I was averaging 100 units a year when it was just me, and then when I brought in a salesperson, that growth went to 300-plus units a year. Q: There is something to be said about setting up systems to be able to accept this kind of growth. For most property managers, growing by 10 properties a month is a good goal. So 300 a year is a great launching pad. I don’t know of any information in NARPM or the general property management industry that talks about sales compensation. So how did you come up with a strategy? A: There was no roadmap early on, so I had to make it up. I looked at the type of person I wanted in the role and then I had to figure out the compensation model that person would be comfortable with. It’s rare to find someone with property management experience and sales experience. So unless you’re going to poach this person from another company, it’s going to be difficult for a property manager to find a salesperson with experience in single family management. I looked at other salespeople I might want to attract. Pharmaceutical and medical sales seemed the way to go because these are high energy, results-driven professionals. So I looked at those models. Some had a small salary plus commission and others worked solely on commission. I liked those models. So with our first salesperson, I provided a straight commission and no salary. I built it so that if he did well in the first year, then his compensation would increase in the second, third and fourth years, so it would be hard to walk away. He could earn a great income if he performed. Q: So you used a recurring compensation plan. He got to eat a bit of what he killed over time and each account brought him a percentage. A: Right, if he brought in a single family home for us to manage, he earned 25 percent of all the revenue associated with that property for one year. Then if he retained the property under our management in year 2 and 3, he’d continue to earn 15 percent. In year four, the commission would drop off. Q: That’s a lot of money. A: I learned that the industry standard was similar to that, and I also learned that you get what you pay for. If you want that top notch rainmaker, they will need to make a good living and you’ll have to compensate appropriately. But you may not need a rainmaker. If you’re getting a lot of warm leads from SEO and content, you don’t necessarily need a rainmaker, you need someone with good sales structure and organizational skills who can do presentations. That person doesn’t need to make $150,000 a year. You’ll find a good salesperson who can earn $60,000 or $80,000 a year. If you’re paying high rainmaker numbers, make sure they are bringing in a lot of business. Q: So for a younger company, it made sense to pay your salesperson a full commission of 25 percent of the annual contract value (ACV), for each property. And initially, you had a bit of a continuation plan that dropped commission but kept them interested in staying with your company. My worry is that you don’t want your salespeople to get fat and lazy. You want them sharp. How do you do that? A: Now we are on our second business development person and we’re using a completely different compensation model. It’s partial salary and partial commission. There’s a one-time commission when they source something. So there’s no danger of becoming fat and lazy. The way you prevent that is by hiring someone who isn’t prone to that. You want someone who will always push and stay hungry. If they get that way, change the compensation model or find someone new. This model we’re using now is much simpler. They get a salary and a certain number of dollars to bring

This “Las Vegas vs. Memphis” interview is the first episode of our “Investment Property Showdown” sub-series within the Property Management Show podcast umbrella. This also serves as the 7th episode of The Property Management Show — the very first podcast dedicated to the property management industry and its success. Key Takeaways: When investing in real estate, location and down payment are key factors to consider. It is important to research the local market and understand the best strategies for success. A down payment of 20-25% is recommended. In Memphis, the median home price is just shy of $150,000, and investors can leverage up to 50% of the purchase price. In Las Vegas, the median home price is in the $212,000 to $215,000 range. It is important to find the right partner in a property management company and treat the investment as a business. Douglas and George are two great resources for investing in Memphis and Las Vegas, respectively. When investing in either city, it is important to monitor the property and make sure the property manager is doing the job that the investor wants them to do. Chapter 1: Investing in rental properties: Las Vegas vs Memphis. – Alex hosts Investment Property Showdown to discuss which area is best for investment property: Las Vegas or Memphis – Douglas explains Memphis’ economic stability, growth & rent to price ratio; George mentions Las Vegas’ low prices & potential business growth – Douglas & George explain minimum down payment & median home price in Las Vegas. Chapter 2: Real Estate Investing Strategies. – Real estate investing can be profitable, but understanding the market and best strategies is key. – Median home price in Memphis is $150,000, leverage up to 50% of purchase price for higher return. – Appreciation rate in suburbs is 3-5%, Las Vegas varies by zip code. Henderson is expensive to buy/renovate. – Research local market to make informed decisions and maximize ROI. Chapter 3: Investing in Property. – Location and down payment are key factors when investing in property; single-family homes in the range of $200,000-$250,000 are recommended. – Avoid homes in homeowner’s associations; 20-25% down payment is recommended. – Property manager should be hired; formula for Memphis success includes investing in older homes for $50,000 with zero-25% down and expecting $800 in rent. Chapter 4: Investing in Las Vegas and Memphis. – Las Vegas and Memphis offer great opportunities for real estate investments, but research and interviews are needed to find the right property management company. – Las Vegas houses rent for a minimum of $1200/month, while Memphis houses rent for $800/month. – Douglas and George can help investors find properties in their respective cities. The post Where to Buy Real Estate: Las Vegas v. Memphis – Investment Property Showdown appeared first on Fourandhalf Marketing Agency for Property Managers.

Subscribe to The Property Management Show on iTunes Today to Stay Up to Date on the Latest Episodes The topic today is understanding the process of joining a property management franchise when you’re starting your property management business. We have two guests who are the perfect people to speak on the subject. Randall Henderson, the Director of Training for Property Management, Inc., and, the person who needs no introduction if you’ve heard of NARPM: Brian Birdy. He’s joining us today as Vice President of Residential Management for PMI. They’re going to give us an introduction to their company and talk about what sets them up as experts in the franchise field. Randall: Property Management, Inc. has been around for about seven years. We’ve had explosive growth recently, and in the last couple of years we’ve added 60-plus franchisees. What differentiates PMI in the industry is that we offer a wide variety of property management types. Not only do we do residential management, but also commercial and association management. The residential piece is still our primary focus, but we have added more pieces for our property management franchises. The franchise world is growing in the property management industry because starting a business from scratch is a challenging and scary thing. So these new business owners who come in are nervous and they want some systems in place. They want to work with people who have been there and understand the industry. They want someone who can provide value on technology. I came to PMI after running different real estate companies. I’m a broker and that’s what led me to a place where I can help train and teach new entrepreneurs. Brian: One of the things about franchising is you do have someone physically there ready to train you. That’s one of the things Randall has successfully established. He has put together an extensive training program which gives our franchisees so much more than what I had when I started there. NARPM is a valuable organization and we recommend that everyone join it and participate, but it isn’t there to take you on a moment by moment tour of the industry. PMI gives our franchisees a significant training that never ends. It’s formulated and includes weekly activities forever. You always have an opportunity to learn something new to grow your business. I have 20 years of experience with a property management company, and I’m a national instructor with NARPM. This year, the interest level in franchising and specifically in PMI is at its highest that anyone has ever seen. We have a team that can support that, so the momentum is exciting. Q: Property management has truly grown in prominence as a recurring revenue business. It also has the potential for complementary business units like real estate sales and maintenance, which increases the lifetime value of a customer. With that, here’s my first question. What does a franchise really solve for a potential entrepreneur who wants to start a property management company? Who should consider a franchise? What’s the profile of a person who should consider your franchise? Brian: It’s right for the person who is willing to recognize that you are building and growing a business. This person needs to have the time, energy, desire, and finances to invest in the future of the business. Property management is a fantastic business to be growing, but you need to realize that buying a franchise doesn’t mean buying a business. It’s buying what you need to grow the business. You must actively give the time and energy to grow it or your franchise will struggle. Buying a franchise gives you a boost and a kick-start to getting the business going. You get training and guidance, visibility and a lot of support. You’re given the tools without the expense that others would have to pay to acquire. Q: Do you have to be in the industry or can you come from anywhere? Brian: You can come from anywhere. It’s better, easier, and faster if you come from the industry or you’re a Realtor because you already know some things and have some background. You can be a property manager ready for the next step. There are advantages for those people. The training aspect is easier and there’s the fact that someone in the industry may already have some doors. But if you’re struggling and you’re making all the mistakes and you’re not growing, you might realize you need some help. That’s when it’s important to consider a franchise. I come from a family business that was very small. If I had known I could go to a franchise model, with the tools a franchise gives me, I’d probably be retired right now. The growth would have been faster and there would be less mistakes and less money lost. I would have given credit all along to the franchise brand. That’s why I can tell people today that unless you are a significant manager in the market you’re working right now, think about a franchise. It’s available for anyone and everyone. Randall: I always ask what will ma

Subscribe to The Property Management Show on iTunes Today to Stay Up to Date on the Latest Episodes The topic today is how building a culture of innovation can grow your property management business. Our guest is Chris Hermanski, someone I’ve known for six years. Chris, can you tell us about yourself and how you came to be a property manager? A: I’m the owner of Mainlander Property Management, in Oswego, Oregon. Our emphasis is managing individually owned single family homes and condominiums. We have a portfolio of about 1,300 to 1,400 properties and we work with 1,000 to 1,100 clients. My degree is in business management and I’ve been doing this for 35 years. I kind of fell into the property management business. I was selling real estate for a few years, but that was when interest rates were high, so it was hard to make a lot of money. Then I started managing houses for builders and we built the property management company from there. I have been involved with NARPM since 1997. I’ve served on the Board of Directors for eight years, I’m a past national president and I founded the Broker Owner event. That’s really our platform for connecting with owners of property management companies and dealing with what’s new and coming. Q: It’s an honor to have you on our show because I know you’re busy so catching you for a few minutes is important. Let’s dive right in. I don’t think there is any more product innovation left. To really build something new you have to innovate the factory, not the product. I say this because one of the people I look up to the most is Daymond John, who said on Shark Tank that there’s nothing new that’s been introduced for the last 500 years. We are interpreting the old in a new way. Even Twitter is essentially a pigeon mail. It’s a note on a bird that gets scaled up dramatically with digital channels. You have been innovative with your company. In my early Appfolio days, you were already an established client. How do you come to be in the forefront of technology and how do you pick the good innovations? A: We are always looking for the next way to improve and enhance our business. I believe in technology and how it can enhance what we’re doing. I like learning how to apply it. I don’t look to the property management world; instead I look to other experiences I have as a consumer. Sometimes the property management field lags behind other industries. So I look to banking, the real estate community, and little things come up. I always thought it was cool when I had a dentist appointment and I got a text as soon as I made an appointment, then a reminder text a few weeks later, and then a text before my appointment. It might have been annoying, but I never missed an appointment. So I thought that would be cool if we could use the same technology for showings. We have come up with some technology that we think is ground floor right now, and we’re working to implement that. You have to keep your antennae up and see what’s going on and how it might apply to what you’re doing. With Appfolio, we were using a software product before that for accounting that was archaic and not doing well. We came across someone doing a fact-finding exercise for a property management solution, which became Appfolio. We were able to tell them what would make a perfect property management program. They created a dream cloud of what we needed. That was exciting. There are other innovations that are also exciting and speaking to what we need. Remote lockboxes and using standard business technologies like scanning our answering services or voicemail systems. We are always aware of how we can incorporate things from the property management industry and even outside of the industry. Q: Tell us about your decision making process. A company like Appfolio approaches you, and you know that switching software would be significant. How many properties did you have then? A: 1000 plus, I believe. Q: So there were a lot of properties to switch, which comes with some risk. I know that LeadSimple also came to you around the same time, but you weren’t interested in trying that technology just yet. So I’m curious: you made the move with Appfolio, but you weren’t ready for LeadSimple at the time. I know you’re using it now, but you didn’t then. How do you decide what’s good for right now and what you need to wait and see before you adopt it? A: A little of it is gut instinct and the rest is knowing what your current needs are. With LeadSimple, I felt like I was a fish swimming up hill to get it started. Our staff wasn’t quite ready to make that switch. But everyone was frustrated with accounting, so we were eager to try Appfolio. We used that system right next to our current system. That made it an easy transition. We were simply replacing the backbone of our operations. LeadSimple was more of capturing and managing and in the old days, we could be more casual about that. Today, it’s a more competitive field, so the technology we get fr

Subscribe to The Property Management Show on iTunes Today to Stay Up to Date on the Latest Episodes My Co-Host and colleague Jordan Muela, with LeadSimple, visited the Fourandhalf studio to help me map out a solid sales process for your property management company. How to Set Up a Solid Sales Process for Your Property Management Company Hello and welcome to The Property Management Show. I am your host, Alex Osenenko. My day job is serving as the CEO of Fourandhalf, a marketing company working exclusively with fee-based property management companies. I have spent the last seven years of my life helping property management companies become more successful by improving sales, marketing and operational efficiencies. In this show, we’ll deconstruct success down to its key components and invite subject matter experts to help you improve every facet of your business. The topic today is how to set up a sales process for your property management company. The timing is good for us to help you put together a process so you can compete effectively and take advantage of every owner lead that comes into your company. You don’t need specific sales tools. Our guest is Jordan Muela, the creator of a property management CRM system, so his talents are in the sales process and how to automate it. But we’re talking about putting together a sales process that is so simple, it can be written on a notepad. Q: So Jordan, let’s dive right in and talk about the first stage of the sales process. Initially, when that lead comes in, whether it’s an email lead or a phone call, what is the most important thing that needs to be done? A: Discovery is what has to happen first in your sales process. Engage with people. Control yourself and don’t start talking about yourself and what you do. Start the listening process. Ask questions. Q: Yes. As a professional sales person, I am always extremely successful with any product I’m selling, and it’s not because I’m a great talker or a sweet guy. It’s because I ask good questions. I listen and I listen with intention and I’m able to dig a little deeper and ask a few more questions and understand the pain point and the problem. Don’t lead with a discount because if you do that, you’ve already lost. People don’t buy based on price necessarily. They say they care about your fees because they don’t know what questions to ask. In discovery, you connect with them emotionally. Tell us about acceptable response times. A: Getting someone on the phone as quickly as possible is basic. There are some very slow response times in this industry. The average response time in the property management industry is 39 hours. This is mind blowing and depressing. No one really owns that number because every property manager we talk to tell us they respond quickly. But responding quickly isn’t the goal. Responding first is the goal. It closes the sale. Q: I just read some reports on the status of the property management industry and where it’s going. I see a clear path for growth for property management companies. People want to rent and move around instead of buying. So property management is getting very popular and profitable. But there are more people competing for the management contracts because it’s so attractive. That’s why the sales process set up is crucial. Accounting has to be something you systemize. If you don’t have a grasp on trust accounting, you aren’t in compliance and you can’t run your business. Next, you need to systemize your sales process. I don’t think anything else will bring you as much value as those two pieces. Inspection software and marketing are secondary. Get your accounting and your sales process in place, and move on. Do you agree? A: That makes so much sense. It might sound backwards to some people. They think they need the leads first. But if you get those leads and there’s no sales process, you’re wasting your money and the leads will not work. So it’s a first order of business, definitely. Q: For the first few years that we were in business at Fourandhalf, I was the only sales person. It was one of my duties as CEO, but I had many others. The only way I could do sales successfully is by using a process. You may think that if you’re the only one selling, you don’t need a process. That’s not true because without a process, you can’t grow. The sales process for one is as important as the sales process for 10. What else do you have to tell us about techniques for discovery? A: Qualification is very important. When you’re thinking about sales qualification, we recommend using the acronym BANT – Budget, Authority, Need and Timeline. It’s a handy thing to keep in mind. You need to know if the owner you’re talking to has a budget. If he’s underwater on his mortgage and struggling to keep the home afloat, he might not be the best property management client for you. You need to know if they have the authority – do they actually own the home? Then think about their needs. Do they have crazy requ

Our guests today are Kim and Scott Hampton with of Hampton & Hampton Property Management. Kim and Scott take us through their story of starting and building a successful property management company in Orlando, Florida. Subscribe to The Property Management Show on iTunes Today to Stay Up to Date on the Latest Episodes The Property Management Show is brought to you by Fourandhalf. We help property managers strategize and implement marketing plans that bring in owner leads. Click the image below to get a free marketing assessment and find out how to start getting better clients into your portfolio. The post “How We Did It” – A Husband and Wife Story of Starting and Building a Successful Property Management Company appeared first on Fourandhalf Marketing Agency for Property Managers.

Our guest today is Jindou Lee, CEO of Happyco.com, a company that provides Mobile Inspection tools for the Property Management industry. Alex, who hosts the podcast, is the CEO of Fourandhalf, a digital marketing agency that works exclusively with the Property Management industry. Happy Co and Fourandhalf are very different businesses, however the success of both relies in building and retaining best-in-class team of people who represent the company values to their customers every every day. In this Podcast interview, Jindou and Alex discuss the specific methods of hiring and motivating their team to achieve peak performance and keep the office as a fun and productive environment. Property management companies are service based businesses and the quality of your team will literally make or break your business. Please share your team building ideas and advice in the comment section. Enjoy the interview and thank you for tuning in. Subscribe to The Property Management Show on iTunes Today to Stay Up to Date on the Latest Episodes The Property Management Show is brought to you by Fourandhalf. We help property managers strategize and implement marketing plans that bring in owner leads. Click the image below to get a free marketing assessment and find out how to start getting better clients into your portfolio. The post How to Hire and Retain the Best Talent for Your Property Management Company with Jindou Lee appeared first on Fourandhalf Marketing Agency for Property Managers.

Subscribe to The Property Management Show on iTunes Today to Stay Up to Date on the Latest Episodes Our guest today is Jordan Muela, CEO of LeadSimple, a company that provides CRM solutions to the Property Management industry. Alex, who hosts the podcast, is the CEO of Fourandhalf, a digital marketing agency that works exclusively with the Property Management industry. Over the last few years, Jordan and Alex built their respective businesses to a multi million dollar growth machines while solving real problems in the Property Management industry. After seeing 100s of property management companies succeed and fail, Alex and Jordan have a wealth of experience to share on how to Grow and Scale a Property Management business in 2016 and beyond. Take a listen. Here is the transcript of the Interview: 10 Property Management Business Growth Hacks for 2016 Hello and welcome to The Property Management Show. I am your host, Alex Osenenko. My day job is serving as the CEO of Fourandhalf, a marketing company working exclusively with fee-based property management companies. I have spent the last seven years of my life helping property management companies become more successful by improving sales, marketing and operational efficiencies. In this show, we’ll deconstruct success down to its key components and invite subject matter experts to help you improve every facet of your business The topic today is 10 tips for growth hacking your property management business. Let’s define growth hacking. It’s an interesting term that a lot of people don’t understand. I had to go on Google and look it up. Growth hacking is a marketing technique that use creativity, analytical thinking and social metrics to sell products and gain exposure. Specifically, most growth hackers focus on low cost and innovative alternatives to traditional media marketing. Our guest and co-host is Jordan Muela, who is the CEO of LeadSimple, which provides software for property managers to handle their lead nurturing and sales process. Each of us will provide five growth hacks that we see as being useful for property managers. Jordan: Productized Rental Reports. A lot of companies have different offers and enticements to get people in the door. A popular offer is to establish an exchange of information for an email address. The rental report allows potential customers to find out how much their home will rent for. It’s a straight forward, basic proposition. Consumers understand what they’re being offered. A lot of people are putting this offer out there, so the challenge is in getting them to bite. You want to provide a rental report that is interesting and well designed. People will feel like they gained something. Don’t jot some information down or type it up loosely in a Word document. Work with a company like Rent Range which has professionally put-together report. You can customize them with your brand logo. This provides a nice, slick deliverable. When you get people to your website and you’re offering this report, take a miniaturized image of it and use it as part of the enticement. People need to see a visual ahead of time so they know they’re getting something of value. Renters Warehouse does this really well. Check out their Contact Us form and you’ll see the preview graphic of the report. It’s an inexpensive offer that will give you a lot more mileage out of website traffic. Alex: Once you start getting those leads, people who want to download that report and see what their house will rent for might not be ready to work with you right away. That’s okay, because it leads us to my first growth hack, which has to do with marketing and growing your business. Content. At Fourandhalf, we talk about the value of content all the time. We know that 80 percent of all searches are long tail, which means people are asking Google questions. Another interesting statistic is this: Amazon.com makes 57 percent of its sales from keywords outside of popular terms. So people aren’t searching for shoes, but they might be searching for green shoes that reach the knee for fishing. This demonstrates that content is by far the foundational way to monetize just about every avenue of your business, including productized rental property reports, your website and pay-per-click programs. Here’s an example of content and how it can become your ultimate growth hack: Five Ways to Remodel your Rental Property in Chattanooga to Cash Flow in 2016. There’s your article. If 50 people find it in 60 days, how many of them do you think will have a rental property in Chattanooga that they are thinking of remodeling? Most of them. That’s why content is my number one. Jordan: I love content because you don’t just publish and leads start coming. You produce the content and the value comes in over a period of time; maybe 5, 10 or 15 years. It’s the gift that keeps on giving. Lead Nurturing. Lead nurturing is so valuable. Lead nurturing is not throwing away leads that don’t convert within 14 d

Our guest today is Scott Brady, President of Progressive Property Management in South California. Scott and Alex discuss a specific property management growth strategy: targeting SMIPOs or Self Managing Investment Property Owners. Scott reveals how he doubled his company size every year for the last 4 years by implementing the “Blue Ocean SMIPO Strategy”. Subscribe to The Property Management Show on iTunes Today to Stay Up to Date on the Latest Episodes The Property Management Show is brought to you by Fourandhalf. We help property managers strategize and implement marketing plans that bring in owner leads. Click the image below to get a free marketing assessment and find out how to start getting better clients into your portfolio. The post Growing a Property Managing Company by Targeting Self Managing Investment Property Owners – Blue Ocean Strategy with Scott Brady appeared first on Fourandhalf Marketing Agency for Property Managers.

Subscribe to The Property Management Show on iTunes Today to Stay Up to Date on the Latest Episodes Our guest today is Kathleen Richards, President of Portola Property Management and PropertyManagementCoach.com. Our interview is geared towards a newer Property Management company that may need help establishing their pricing and hiring people. However, this interview contains plenty of useful advice for both newer and seasoned Property Management business owners. Transcript of the Podcast: Starting a Property Management Company: How Much to Charge and How to Build a Team Hello and welcome to The Property Management Show. I am your host, Alex Osenenko. My day job is serving as the CEO of Fourandhalf, a marketing company working exclusively with fee-based property management companies. I have spent the last seven years of my life helping property management companies become more successful by improving sales, marketing and operational efficiencies. In this show, we’ll deconstruct success down to its key components and invite subject matter experts to help you improve every facet of your business. The topic today is starting a property management company, and how much to charge for your services and how to build a team. To help me talk about this is Kathleen Richards, the CEO and President of Portola Property Management and the founder of ThePropertyManagerCoach.com. She has journeyed from property manager to property management coach. Q: Kathleen, thanks for being with us. Why don’t you introduce yourself and tell our listeners what you do. A: Thanks for having me. I’ve owned Portola Property Management in Santa Cruz for 10 years. Prior to that, I worked in Silicon Valley, so I have a background in tech, finance and business. That helped me to grow my companies. Over 10 years, I have taught a lot of classes at community colleges and conferences. A lot of new people in the industry don’t have a formal education in property management and they’re learning as they go. So I became a certified coach, and I’ve been coaching individuals who manage or own properties. I wanted to help my industry colleagues get up to speed quicker, so I evolved into business coaching. I don’t want someone to spend 10 years getting to where I am. We can learn from each other and grow without struggling and working so hard. Q: So when someone is starting a property management business, how do they determine their fee structure and how do they create it for future growth? Most new managers want to make sure they can help their company grow, and be competitive without giving away too much. Do people change their fees very often? A: Most people don’t, but they should be. There’s a money mindset that people have when they run a business. It comes from how we view money. There’s always a debate about whether it’s okay to raise prices and add services. Some people think they will lose clients: If I raise my prices, I will lose clients. They have a money mindset that they’re not valuable enough to charge their fees. If you are too cheap, you’ll get the cheapest owners who don’t want to spend money on their properties. You’ll be fighting over maintenance needs and your stress level goes up. Cut out those owners. Raise your prices and increase your value. If you are confident that you’re the best in your area, people sense that and they will pay that. I’m not the cheapest but people stay with me and no one asks me to accept less. Be prepared to explain what your price is and why. If someone isn’t willing to pay what you are asking, invite them to hop around and maybe you can work together in the future. That’s scary for a newbie. Q: They have to win the business somehow. A new property management company needs a price point that is low enough to attract a buyer. So maybe they can also have auxiliary services where they make money. Some successful property management companies have contracting business as well. They do remodeling and they lead with that service, providing rehab services for investors. So that’s an incredible opportunity for new companies to charge a flat fee and then have additional revenues. It comes down to strategy, doesn’t it? A: Yes. I have a maintenance company too. The difference is the quality of owner. You can take on beaten down properties. But the owner needs to come for your expertise and be willing to pay for it. My in-house maintenance department is valuable, and owners or investors must be willing to write the check. In Santa Cruz, we don’t have a lot of new construction. We developed an in-house maintenance department so we can be on top of maintenance needs. This is a surfing area, so when the surf is good, some of the local vendors are out there rather than getting our jobs done. We wanted to be sure we had maintenance teams ready to show up, so we created our own. Q: So the people who are just starting out with no experience can’t say they’ve been doing this for 20 years. So how do they set up a price matrix? A:

Our guest today is Jordan Muela, CEO of LeadSimple.com, a sales CRM software tool designed specifically for property management firms. Jordan and Alex discuss how successful property management companies use both Pay-per-click and Pay-per-lead strategy to scale and grow their businesses. Subscribe to The Property Management Show on iTunes Today to Stay Up to Date on the Latest Episodes How to Scale a Property Management Business Through Pay Per Click and Pay Per Lead Hello and welcome to The Property Management Show. I am your host, Alex Osenenko. My day job is serving as the CEO of Fourandhalf, a marketing company working exclusively with fee-based property management companies. I have spent the last seven years of my life helping property management companies become more successful by improving sales, marketing and operational efficiencies. In this show, we’ll deconstruct success down to its key components and invite subject matter experts to help you improve every facet of your business. The topic today is how to scale a property management business through Pay-per-click or Pay-per-lead methods. Our guest is a resident expert on anything to do with sales, and he is specifically experienced in the Pay-per-lead world. He runs a company called ManageMyProperty.com. Today we are talking to Jordan Muela, the CEO of LeadSimple.com. Q: Please walk us through the ManageMyProperty.com. What does it do and what is it all about? I started in the industry working for a venture-backed Homeowners Association company back in 2007. From there, we decided to start a business that sold leads. It’s a Pay-per-lead model and it’s called ManageMyProperty. Then, we started a second company that provides lead software, and that’s called LeadSimple. Q: So ManageMyProperty is exclusively for management companies. Is it exclusively for residential property managers, or does it deal with other sorts of leads? About 90 percent of our business is with the residential market. There’s a small portion of homeowners associations that we work with, but the vast majority of the work we do is for single family homes. Q: I see some consistencies with companies being very successful with Pay-per-lead and Pay-per-click and then some companies are more reserved about buying leads. I’ve created a list of five common traits that make companies successful with these models, and I’ve asked Jordan to put together his list as well. We’re going to compare our notes and see what we can come up with. That should help our listeners decide how to buy leads. So what is the first reason that people are successful with Pay-per-lead campaigns? People are successful because they understand what they’re paying for. There is a high volume of churn, which means there are a smaller number of companies who stay with it. They dominate because they have a great strategy and they stick with it and sell. Then, there are other companies that will come into the market, do it for a period of time and determine that it is too expensive or it doesn’t work, and they go away. That disparity does merit having an understanding of how this works. Folks that are succeeding know what they’re paying for. They understand this is an opportunity to make a sale and it’s not an actual guaranteed sales result. It’s not like getting referrals. For people who are just starting out, they don’t get past the referral stage. Referrals are fantastic, and we always want to optimize that. However, it’s not a push button mechanism that will give you leads on demand. So if you want to scale your business, you’ve got to explore the scary world of paid marketing. Pay-per-lead is one of those options. Another thing to understand is how the bidding model works. The bidding model will be a first price or second price auction. A first price auction is where you bid $10 and you pay $10. A second price auction is where you bid $10 and you pay up to $10, but the system will manage your bid and keep it as low as possible while still maintaining the best possible rank. Those are two pretty different systems. One is not better than the other, but with a lot of Pay-per-lead services, we’re talking about a paradigm where that lead is going to go to more than one vendor. Consumers are seeing a list of companies and deciding who they want to contact. They’re going to want to talk to more than one company; this is a huge asset and investment, so you’re aware of the fact that it’s nice to get quotes from more than one company. For some property managers, that comes as a surprise or a disappointment. You want an exclusive lead, but that’s not how it works. So it may not provide the best return on your investment to bid yourself all the way to the top of the list. There are 10 companies in a list and any consumer who contacts a person on that list will probably contact three or four companies. If you’re in the top three or four spots, you will likely get a high percentage of the leads without paying top dollar. So it’

Our guest today is Michael Catalano, CEO of Real Estate Connections, a property management firm based in the Silicon Valley, CA. If you’ve ever wondered who to buy or sell a property management company, then this Podcast is for you. Subscribe to The Property Management Show on iTunes Today to Stay Up to Date on the Latest Episodes Here is the transcript of the interview (You can play the full interview above, or download the episode into your iTunes or Android) Hello and welcome to The Property Management Show. I am your host, Alex Osenenko. My day job is serving as the CEO of Fourandhalf, a marketing company working exclusively with fee-based property managers. I have spent the last seven years of my life helping property management companies become more successful by improving sales, marketing and operational efficiencies. In this show, we’ll deconstruct success down to its key components and invite subject matter experts to help you improve every facet of your business. The topic today is how to buy or sell a property management company. That’s a vast subject, and our guest is certainly able to speak to the topic and clarify many of the different things that can confuse the issue. Not a lot of property management companies are bought and sold every year. There are only a few experts, and Mike Catalano is one of them. He is the CEO and president of a company called Real Estate Connections in the Bay area. He’s also an angel investor and a good friend. Q: Let’s start with a question that I wonder myself: Why would someone buy a property management company? What are some of the reasons behind this? Buying a property management company is the fastest way to grow your business. It’s always great to grow organically and advertise online, and you want to attract more business through word of mouth and referrals. Those are great strategies to maintain your business and allow it to grow at a decent pace, but the quickest way to grow a company is to buy one. Q: So buying a company is essentially a way to expedite your own growth? Absolutely. If Google can guarantee that you can get 200 new properties in a year with advertising and search, but you can also do that right away by purchasing a property management company for the same amount of money that you’d pay Google, you’re getting a good deal. Q: If you want to grow your business by acquisitions, how would you find a property management company for sale? They are hard to come by. Word of mouth in the industry helps. Years ago, I would not tell a lot of people know that I was interested in purchasing, because I worried it was pretty arrogant to express your interest in buying someone’s company; a business like this can be extremely personal. But then several years ago I mentioned it in a networking group, and I learned that people are open to it. Let your local and state chapters of NARPM know. Talk to banks that hold trust accounts for property management companies. There aren’t a lot of them, so obviously the bank you use is a good place to start. I came across a few business brokers that I work with, and I let them know that I was interested in buying a property management business. So it can be a word of mouth strategy. Q: When was the first time you bought a company? I helped a company that I worked for when I was in my early 20’s. That company purchased a handful of businesses and those were the first purchases I went through. I didn’t own the company, but I went through the process and as director of operations at that property management firm, I learned how to do it. Later on in my career, I started purchasing them within my own company. It’s changed a lot over the years. The evaluations have changed, the process of finding the companies has changes and the people who want to buy and sell have changed. This is an interesting subject because it comes up at every NARPM event now, and it’s interesting to a lot of people. There’s not a perfect science, but it comes down to what works for you as the owner of a property management company. Q: Things are always changing dramatically in the property management field, but there are some fundamental frameworks we can apply to this. We need to put it together and provide people with a foundation when they’re looking at these things. One of the questions I recently heard in response to a blog was: how do you evaluate a property management company? When you evaluate a company to purchase, you have to evaluate based on what it’s worth to you. A lot of times, the people selling it will set a price. So you have an idea of what they’re looking for. Then, you have to dive in deep to your finances. Figure out what makes sense for you. When I go to purchase a company, I can absorb a lot of their properties. So that allows me to pay more, knowing that I will make more. You won’t make money right off the bat because you’ll need the payment, and how you structure that is up to you. There are a few areas where you can find