Building your bottom-line means retaining more managements. To do this, some property management business owners encourage listing and selling their doors under management. But, quite often, these sales go to another agent because an in-house sales process has not been implemented. This often results in more managements being lost than retained. To retain more managements, here are three steps to build an effective sales process.
Appoint one agent (normally you or a salaried team member) to be responsible for listing and selling managed properties. Doing this ensures that you retain the sales commission, and more than likely the management too.
Implement a process whereby your current clients are given a 30-day window of exclusive buying opportunity for income-generating properties. This offers additional benefits to both the owners of these properties, as well as current clients.
As your business grows, selling to existing clients becomes easier. Since your agency is already managing the listed properties, as well as managing properties for the buyers, the opportunity to retain these managements increases to almost 100%. It’s also a great way to improve your agency’s listing stats, such as “listed and sold within 7 days”.
By reducing the cost of selling, you can reduce the commission too. In most instances, the actual net commission would be far greater than listing the property on the open market. It also helps promote you to clients who are seeking an agency to manage their property.
Property management business owners often buy rent rolls in the hope they can generate cash flow and grow their sales from the rent roll. The reality is, you have a loan on each management usually averaging seven to eight times the asset value of the management, due to loan, buying and ongoing costs to manage each property. In real terms, this means that it takes seven to eight years to pay back the debt on a purchased door. Instead, to retain more managements, you should implement an in-house sales process around your managements as this is by far a more effective long-term solution.
For more information about how you can build a sales process around your managements, contact us.