What does a landlord look for when choosing a property manager?

To be ready for 2020, businesses need to start thinking about their strategy for client attraction and success now. At realestate.com.au, we invest lots of time to speak to consumers about their idea of the future and their expectations around service.

Recently we surveyed landlords across Australia to get their views on the current property management landscape, asking:

1. How do landlords find an agent? What does the research process look like?
2. What are landlords looking for in a property manager? What do they value most?
3. How satisfied are landlords with agents? What frustrates landlords most?

It's very clear when we spend time with business owners all over Queensland that now is the time to be asking - are we growing or selling? That is a big question. The landscape in recent weeks has changed so much. We now have certainty around the future of property regulation, banks are starting to loosen lending, the RBA has reduced interest rates and the buyer demand on realestate.com.au has seen a steady spike post-election.

This is all great news for us in real estate. But, for property management we are seeing a change in the expectations of our customer - landlords and tenants are demanding more communication, higher levels of service for the same or less money and are all much hungrier for data than ever before. In some of the insights that I'll share share, it's clear that we have some opportunities to really maximise the interactions we have with consumers and separate ourselves from the pack in terms of attraction and service for 2020.

Research

When landlords are searching for a property manager, 63 per cent of landlords spent two weeks doing research on who they would like to speak to about their service offering [1]. They started their search online looking at who was advertising similar properties to theirs and really reviewing the way properties were presented and positioned online. We found:

• 38% of landlords look for agents listing similar properties to theirs on realestate.com.au[2]
• 25% of landlords look for agents listing in the same suburb as their property on realestate.com.au[2]
• 21% of landlords look for agents with the best quality listings/photos on realestate.com.au[2]

When we asked landlords who they eventually decided to do business with, 50 per cent selected the first property manager they met, often through the agency they purchased through. The other 50 per cent interviewed three or more property managers before they selected one.[1]

Value

In real estate, like most service industries, the fee our customers pay is based on the amount of value we provide or rather, the value the customer feels they get. In my role, I speak often about our Value Proposition for property management - why should a landlord choose us?

If you can't articulate this, then you've got work to do. Take a moment to write down a list of things you do as a business to attract the greatest number of tenants, in the fastest time, for the most amount of money for your clients. Aim for #75Things - a little catchphrase of mine to help motivate people to aim high. I know this is a lot, but it you get to 10, 20 or 30 - that will start to help you tell a compelling story to potential clients about why they should choose you. If you can clearly articulate your value proposition, highlight your point of difference and demonstrate your experience, you will have success with winning new business.

Satisfaction and long-term relationships

Looking at how well property managers performed on the key drivers of satisfaction, at a national level, landlords were generally satisfied with "How well they managed the tenant" at 7.21/10. Following close behind was 6.6/10 saying "How often you supply information about the property and the market" was key. Communication consistently appears as a strong decider in satisfaction, with 53% of landlords expecting to have some level of contact with you at least monthly[1].

Selecting the right tenant will positively influence landlord satisfaction, but landlords can be impatient.

We saw:

• 59% of landlords stating that 'making sure their investment property was always leased out' was a major concern.[1]
• 64% of landlords want to know how you select a tenant. [1]
• 58% want to know how you ensure rent is paid on time. [1]

Securing long-term relationships were dependent on three aspects:

1. 42% market Knowledge[1]
2. 34% management of tenant[1]
3. 24% marketing the property to get best rental price[1]

So as we reflect on the information we collected and our own feelings towards the market, I believe we're in a great position as an industry to win in 2020, provided we acknowledge that we have some incremental improvements to make to the way we service our customers.

Three things to action today:

1. Appeal to prospective landlords by:
   • Making your first impressions count! Average research timeframe was less than two weeks[1]
   • Fees and agency branding are key, so get these right.
   • Be aware that landlords are looking for greater than two years' experience[1]
2. Communicate your tenant management strategy and ongoing process to prospective landlords:
   • How are tenants selected and vetted
   • How will rent be collected and paid
   • The process for rental inspections and property maintenance
3. Develop ongoing landlord communications:
   • Desired response time is within one day of an enquiry
   • Monthly updates were most preferred ongoing
   • Updates should be customised to the landlord/property

[1] realestate.com.au &; Forethought Research, September 2018

[2] realestate.com.au Residential Consumer Omnibus July 2017