When property owners hear the term “property management,” they conjure up a variety of definitions – most of which are not accurate.
The challenge is that without a standardized scope of services provided by property managers, it’s easy for confusion and frustration to take hold, because most client expectations don’t align with the actual services rendered by a property manager.
Why the Current Situation is Problematic
Property management as an industry is poorly understood in the marketplace. Because of this, people make up their own definition about what a property manager should and shouldn’t be doing.
This is problematic for a few reasons.
First, without some level of standardization, it can be difficult to compare quotes among companies, as their scope of services often vary widely.
Second, many property owners fail to differentiate between the services of asset management and property management [link to previous post]. Failing to understand the differences between these two roles can cause friction. But the bottom line is that it is simply not within the realm of services for a property manager to offer advice and guidance on the positioning, branding and overall strategic forecasting of a given real estate investment. Their job is to manage the property, collect the rent, and ensure the units are safe and habitable.
Why the Push for Industry Standardization
Nearly every property manager can attest to the fact that the level of expectation that the customer has rarely matches what the property manager is expecting to provide. When you mix real property, money and people, there are a lot of opportunities for problems and issues to arise.
In order to fix this, we at RL Property Management believe there needs to be some kind of a standard scope of service for property management – a baseline definition of what property management is.
As it currently stands, there is vast inconsistency among property managers. For example, what one property manager calls a leasing fee, another one might call a letting fee, and yet another may call it a vacancy fee or a marketing fee.
This inconsistency means it’s very difficult for a property owner or investor to compare property managers because each one uses their own language. Their pricing structures may also be completely different as is their scope of service.
With a standardized definition of services, we believe everyone is going to be happier because you strip away some of that confusion and can streamline and improve operations when everyone is on the same page.
To hear more from us as we discuss asset management and property management, listen to episode 8 of our podcast Owner Occupied. As always, feel free to get in touch to let us know what’s on your mind when it comes to property management.