We know that you have more than likely had a property manager who wanted a higher salary or else was going to leave your agency. This is a common situation for many business owners, but it doesn’t have to be a negative one. If your property manager says they will leave unless you increase their salary, here are three ways to manage the situation so it’s win-win for both you and your team member.
You could pay your property manager a lower salary but with new higher incentives based on real financial results. For example, bonuses should not be paid on achieving 0% arrears or 100% fixed term tenancies (these should already be expectations of the role or key performance indicators). Instead, formulate income targets for their portfolio and, if these are achieved, the property manager could be paid a pre-calculated bonus, each time.
Setting portfolio income targets mean that targets have been formulated against your business income targets and, as a result, helps achieve these targets as well as boost income for your property owners. A lower salary with new higher incentives based on financial results therefore means that your business is paying for results, rather than a higher salary for the sake of keeping an employee happy at the detriment of your business.
Set salary increments into your property manager’s employment agreement. Setting salary increments means setting ‘milestones’ that your property manager can work towards in order to earn salary increases. These milestones can relate to performance, growth, training, accountability, retention, loyalty and portfolio profitability. That way, any salary increase you reward your property manager with is now positively linked to any increase they bring to your business.
Hold a one-on-one meeting with your property manager to show them the high costs associated with their portfolio, to demonstrate that you simply cannot pay them any higher salary than what is already being paid. At this time, you should provide them with the opportunity to either resign or work with you to find ways they could increase the profitability of their portfolio so that, in the future, there may be an opportunity for you to increase their salary. You should give them 24 hours to decide which option they choose moving forward.
Ultimately, it is your responsibility to ensure that your team is accountable for their performance and results. Implementing measures, such as the options above, can lead to win-win outcomes for you and your team members, and negate the need for any property manager to tell you they will leave unless you increase their salary.
Manage your property managers’ salaries, expectations and performance by choosing to implement higher bonuses, rather than higher salaries. Remember, higher salaries does not necessarily mean better results. But, higher bonuses always results in better performance.
If you want to find out more about how you can manage your property managers’ salaries, expectations and performance, contact us.