Property managers – create value and generate income by automating tedious tasks
Automation could be their ticket to a more profitable career in property management.
Property's poorer cousin
Property management is often seen as the poor relation to real estate sales – and not without reason.
According to Statistics Canada, real estate is the single biggest contributor to the Canadian economy, accounting for just under 13% of total GDP at last count – around $253 billion in 2012-adjusted dollars – and delivering more than half of Canada's quarterly growth.
But the sector is dominated by sales, followed by non-residential and then residential leasing. At Statistics Canada's last count, the property management sector as a whole – commercial and residential – generated just $7 billion in revenue. Canada's real estate market may be booming, but Canada's property managers aren't seeing the benefits.
Making property management pay
There are good reasons for property managers to be optimistic, though. The rental sector is growing. Canadians are living in rented homes for longer. More and more are preparing to rent for life, especially in major hubs like the Greater Toronto Area, Vancouver and Ottawa. Property management has the potential to become a real third pillar of Canada's real estate sector – but seizing that chance requires a change of business model and the adoption of new technology.
Currently, many property managers rely on time and labour-intensive, difficult to scale services like property maintenance and inspections to generate an income. Demand for these kinds of services will always exist, but the time and money spent delivering them makes it hard for property managers to find the time to grow their businesses. Real estate companies and multifamily developers end up treating them as an unprofitable afterthought.
"Instead of clearing snow or negotiating with condo boards on behalf of landlords, property managers can generate sustainable, scalable revenue by offering technology-driven services like automated payment processing,"
"Payment reconciliation is an area ripe for innovation – in many ways, rent payment processes in Canada lag behind the rest of the world. While some multifamily developers now accept recurring direct deposits, the Canadian residential rental sector still mostly runs on one-off Interac e-Transfers and cheques – both of which are time-consuming to administer and full of potential for costly errors," he says.
"By automating rental payment reconciliation, property managers can save time for their clients without increasing their own admin burden. Incoming payments can be automatically matched to the right renters, commission deducted and owners paid in just a few clicks – all on the same day the rent comes in. Rule-based automation is also highly scalable – it works the same way whether a property manager is reconciling payments for five units or 500, so they have the flexibility to grow with a growing market. And when payment processing is automated, reporting can be automated too – owners can be sent instant, up-to-date statements without any additional effort. It's a very attractive value proposition for them – high-value services rendered with the utmost efficiency."
Speed, security and transparency make automated payment processing a service that property owners will attach significant value to, despite taking a fraction of the time and resources to deliver. Forward-thinking property managers should rush to add it to their range of services.
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Notes to Editors
PayProp is an automated transactional and reconciliation platform for the residential property rental sector that is both easier to use and more powerful than existing solutions offered by banks and traditional software vendors.
PayProp was launched in 2004 and has quickly grown to become one of the largest processors of rental payments for the property management industry.
PayProp is part of the Humanstate Group, an international company with subsidiaries in the United Kingdom, United States, Switzerland, Canada and South Africa.
For more information, visit: www.payprop.ca.