One property management expert says focusing on returns and add-ons, not commission, is the key to uncovering extra revenue.
Domain Property Advocates director Melanie Dennis said she is seeing too many online posts and articles by PMs that show they are more focused on the commission percentage than the dollar return.
“Know your numbers and the average cost you need to achieve from each property,” she told Residential Property Manager.
“Based on your business model, it might be $80 per month or $120 per month – whatever it is, know it, and do not be prepared to accept business that goes below it.
“There is absolutely no point in managing property where you are paying to do it rather than the client paying you!” she added.
Ms Dennis said it is also important not to forget the “add-ons”.
“Do you charge an ‘out of the usual’ hourly rate? Do you charge appropriately for attending tribunal hearings? Are you charging for statements both monthly and end of financial year? When was the last time you reviewed these costs?” she said.
“A business managing 500 properties can have an injection of funds each month by raising the current $2 statement fee to $3.50. That is an extra $750 per month or $9,000 per annum, as an example,” she added.
Ms Dennis said the key to adding revenue to your business is to consistently review.
“Advertising, for example, goes up for us – and as a result, it also needs to for your clients.”