Final modified on December 1st, 2022
By Stacy Holden
Regardless of a historic climb in hire costs this previous yr and surging demand for items nationwide, as we speak’s property managers are contending with a bunch of challenges, from rising materials prices, to cutthroat competitors, and even perhaps some belt-tightening efforts amid wider financial issues.
Latest analysis from AppFolio Property Supervisor – our 2022 Property Administration Business Pulse – outlines the various challenges going through rental operators amid a high-demand however revenue-hungry market. The report, which polled greater than 1,000 workers of U.S. property administration firms, additionally paperwork the struggles property administration companies face with “shiny” new proptech options. Many new options promise time and value financial savings however finally show to be clunky and insufficient because of poor integrations with present (legacy) property administration software program.
AppFolio understands that actually environment friendly enterprise software program ought to present a transparent return on funding (ROI), enhance worker productiveness and satisfaction, and finally unlock income to develop the enterprise. Our knowledge reveals, nonetheless, that many property administration companies proceed to battle in these areas.
Proptech: A Key Part in Scaling Operations
As exterior financial pressures enhance, it’s not stunning that operational effectivity (62%) and income technology (54%) have been the 2 mostly cited challenges of 2022. A superior, seamless, and complex property administration software program platform is the only most important consider fixing each of those challenges.
Sadly, many rental operators as we speak could fail to spot tech-enabled advantages due to ineffective or dated property administration software program. Moreover, these core property administration methods are unable to successfully combine with companions offering industry-leading expertise options.
What’s extra, there could also be a disconnect between property administration executives and frontline employees in notion of the effectiveness of the instruments they’ve deployed. In truth, frontline employees “on the bottom” are 11 instances extra possible than executives to think about innovation/expertise a prime problem, which suggests their potential struggles with the enterprise’ expertise is probably not reaching decision-makers.
And so the effectivity hole in tech adoption persists, which means property administration companies aren’t but realizing the complete energy of their instruments. Nonetheless, property administration groups have to undertake the mindset that expertise fosters success not solely in a single space, however all through your entire enterprise – streamlining workflows together with funds and upkeep requests, enabling digital showings, and extra. All enable property administration groups to pivot to different vital actions that finally affect the underside line positively.
In some ways, this attracts parallels to the restaurant {industry}, dealing with – and finally rising from – the adjustments pressured by COVID-19 and “going digital” (fulfilling orders and deliveries, or automating parts of wait service). Whereas at first, eating places could have considered this as an impassable hurdle, these companies went from “complicated” to important. Equally, with property administration methods, expertise is an enabler, not a hindrance.
Is the Expertise Market Normalizing?
Whereas The Nice Resignation little doubt dominated discussions even inside our {industry} final yr, there seems to be some normalization in staffing, as organizations proceed to make changes. Such change has now introduced different financial hurdles for property administration companies to the fore. Illustrating this level: human assets, staffing and recruitment have been cited as the highest problem by greater than half of respondents final yr, however in 2022 that determine dropped considerably, to 25%. As a substitute, inflationary pressures have possible elevated effectivity and income as key issues.
However efficient groups are nonetheless on the coronary heart of any profitable enterprise, and constructing or retaining expertise will all the time pose new challenges. Fortunately, expertise has a central position in making the day-to-day simpler for workers and attracting prime expertise as nicely.
As an example, coaching a brand new worker to trace funds by way of index playing cards (sure, folks nonetheless use them!) and even by way of Excel (versus a contemporary property administration software program to automate funds) is the equal to providing a brand new worker a typewriter. Sounds ludicrous, proper? The effectivity and scalability {that a} fashionable property administration platform allows in reworking a enterprise is a night-and-day distinction in comparison with handbook operations.
Fortunately, the perks of expertise in actual property are making property administration jobs each simpler and extra participating, and so extra fascinating. If groups are empowered with the correct instruments, there’s little doubt they’ll additionally make an affect on residents’ lives, together with positively influencing entry to housing, for instance.
Nonetheless, the underside line is that to maintain expertise in place, our {industry} wants to actually emphasize worker expertise – by offering tech, coaching, and instruments.
Efficient Integrations
Property administration firms want their proptech to unlock productiveness and go away clients glad. But, our knowledge reveals that some 40% of managers are sad with the mixing between their present tech stack and new companies meant to streamline work or improve buyer expertise.
Some property managers are working clunky legacy software program developed within the Eighties and, in some instances, could even be based mostly on a number of completely different database infrastructures. The system structure of those outdated options causes defective (and irritating) accomplice integrations and makes a single supply of fact an impossibility. AppFolio Property Supervisor is as an alternative powered by flexibility, spectacular performance and ease of entry, making it true software-as-a-service (SaaS) expertise.
In truth, we consider that certification – which means potential companions are vetted and accredited – is a needed step for any software program integration, together with true partnership. Integrations that now we have included in AppFolio Stack™, {the marketplace} we launched this summer season, are the results of shut collaboration between our improvement groups prioritizing the expertise of the top consumer. The platform allows AppFolio Property Supervisor customers to supply specialised options for these managing complicated portfolios. In it, now we have launched considerate options the place companions have direct entry to collaborate with our builders. This implies they’ve the instruments and knowledge wanted to develop secure integrations atop a powerful, dependable system structure.
It’s an strategy we really feel will assist change the mindset round integrations and get rid of futile finger-pointing that our clients have skilled with different software program suppliers and distributors.
Rental operators have a real accomplice in AppFolio Property Supervisor. In truth, even previous to the AppFolio Stack™ launch, 70% of our customers mentioned they continue to be glad with the expertise’s means to assist them tackle key challenges (in comparison with solely 51% of customers of different property administration options). That is an space now we have all the time prioritized, and now we’re bringing the identical strategy to our integrations market.
Delivering on the Tech Expertise
Whereas rental operators more and more embrace efficiencies fueled by expertise, the {industry} has a methods to go in standardizing such use. However, our knowledge suggests property administration firms are addressing as we speak’s challenges head-on, and time- and cost-saving platforms like AppFolio Property Supervisor could also be key in avoiding new hurdles.
It’s also clear {that a} substantial portion of renters now overwhelmingly select to lease from firms that present the very best expertise. Whereas this has generational tendencies, all of as we speak’s renters merely anticipate extra! So, what higher approach for property administration companies to face out than offering residents (and workers) a central platform with industry-leading instruments and capabilities? It’s going to little doubt ship a satisfying expertise from begin to end.
