How to grow a property management company?

Question

Jonathan Twombly · Answer

@Filipe Pereira  I agree with @Andrew Johnson.  The advice that I usually give to people about how to find a good manager is to look for managers who specialize in precisely the type of property that the owner holds.  Precisely.  So that means a manager who specializes in managing 100+ unit Class A properties is a bad fit for an owner who buys 100+ unit Class C properties.

Turning that logic around, it's going to be tough for you to get into bigger properties unless you do two things.  (Well, there are probably others, but here are two that will help.)

First, you want to start marketing yourself like crazy about being able to manage the bigger properties, so that people know who you are.

Second, network like crazy.  One way to break in and start doing bigger properties is to network with owners and potential owners and build relationships with them.  Chances are, if you go to your local REIA or real estate meet up, there will be lots of people looking to break into real estate who don't know a single other manager.  Now, most of these people will never do anything, but some of them will, and you want to be the manager that they know when they need one.

This is a little cynical, but there are a lot of owners who will never do any due diligence.  Probably most of them will never do any due diligence, because most people are lazy.  If they see a good marketing pitch and they like you personally, they will hire you, regardless of your experience.  But then it is up to you to do a kick-ass job managing the property and making great money for them.  You'll only get a couple of chances to screw up before your reputation is ruined.  So make sure that you make the most of your chances.  If you get a break and then you do really well by the owners, your good reputation will spread and you'll wind up with more business than you can handle.

There is an analogy with brokers here.  Brokers have a really bad reputation in the general public's mind, because there are low barriers to entry and that means that most brokers are actually bad.  But this opens up an enormous opportunity for people like my brother, who has built a successful business just on the basis of serving his clients with great integrity.  When you do that, word travels fast.

The same thing applies to managers.  Among owners, managers have very bad reputations, especially when it comes to smaller properties.  People I coach and advise constantly talk about how hard it is to find good managers.  In fact, last night, I was interviewed for a podcast and beforehand the host was complaining to me about the trouble she was having finding a good manager for her SFRs.  Barriers to entry are low, which means that there are many people managing properties who are not really competent to do it.  But this opens an enormous window of opportunity, especially with smaller properties, to be THE GUY in your market who is super-qualified and does an amazing job for his clients.  If you can be that guy, word will get out, and you will be overwhelmed with offers.

Marc Cunningham · Answer

I suggest you start with 'content marketing' from your web site. Start recording short videos clips in which you address very specific topic on property management issues in your area. This will not only drive traffic to your website, but will also help you with SEO as google and youtube will "find" you and start ranking you higher. I am happy to share how we are using 'content marketing' to grow our property management business. It is easy and virtually free. E-mail or IM me an I am happy to e-mail you what we do.

Theo Hicks · Answer

Search the various rental listing sites (Apartments.com, Craigslist, Zillow, etc.) and reach out to the owners. You've already identified a "need" since they have a vacancy.

Joe White · Answer

My property management company grows by referrals from current landlords and even from the tenants that live in our rentals. It's not uncommon for someone looking for a great property management service to ask tenants of one of our properties, who we are. Also, most rental landlords looking for property managers will look at the top property management reviews. keep those up - that's done by being responsive with tenants. Good luck!

Oscar Pinto · Answer

As an agent I send mailers to 2-4 unit home owners , 2500 6X11 post cards every other month, attempting to get listings. I just started adding "Ask about our property management services".

Sending mailers for only property management does not make financial sense in our market, so piggybacking on a just list /sold mailer may work.

Filipe Pereira · Answer

Great stuff, everyone, thank you! I've taken much of what has been mentioned here, and put it into action. I've also begun going after "expired" MLS listings. My thought here is that if the seller was interested in selling because managing was too much of a headache, I might be able to solve that problem :)

Kevin Hunter · Answer

@Filipe Pereira, congrats on the success thus far.  I would suggest you reach out to as many management companies as you can.  Pick their brains, ask questions, see how they did it.  Learn from experience.  Good luck!

Craig Bellot · Answer

What has worked for us is helping owners online and at meet ups solve their rental property questions and management headaches.

Have a question about evictions? Ask us! Need a good contractor? Here's a referral.

It's truly amazing how going out of your way to help an owner comes back to you in referrals and other business.

Filipe Pereira · Answer

Yes! Working on that right now!

How to grow a property management company?

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