The financial health and growth of the company are priorities to every property manager. As the industry has begun adapting technology, property management analytics are also changing. Whether it is tenancy, lead generation, or marketing, you can understand it all through modern data analytics. In real estate, data evaluation helps improve business performance and forecast financial growth.
Some metrics provide better evaluation of your company’s growth. With technology, identifying and using key analytics has become easier. We provide you with a list of top property management analytics that you can use to evaluate your business performance.
Why use property management analytics?
Real estate data analysis reveals a lot about consumer behavior. Analytics can change the way you build your business model, manage human resources and plan expenditures. For example, you can refine your marketing strategy by analyzing the lead origin rate from different platforms.
In 2019, more than 35% of real estate professionals planned to invest in predictive analysis. If you want to be ahead of competitors, you need to up your game using property management analytics.
You can use several metrics to evaluate the performance of your company, staff, and agents.
The top property management analytics that you need to know
Your business performance does not solely depend on profit. Other metrics can give you more information on the future performance of your company. They also provide scope for improvement by identifying problem areas. Choosing the right metrics depends on the size and type of your business. Some metrics can provide insights into your company’s overall performance. Others focus on a single area or group such as your leasing agents.
These analytics either compare with your past performance or your competitors. Here are the top analytics you can use to evaluate and improve business performance:
Tenant turnover
Analyzing tenant turnover can tell you a lot about your apartment management process. According to Resident Rated, the average tenancy duration in the US is 27.5 months. Usually, the turnover rate is higher for smaller apartments, as tenants look for more space. It is also higher in urban areas than in rural areas. If your tenant turnover is above average, it can be due to many reasons. Infrequent maintenance, outdated amenities, and high rent can make tenants leave. By evaluating the turnover rate, you can improve your property management strategy. You can also ask for feedback from residents that are leaving. This can give you a tenant’s perspective on how well you perform.
Occupancy rates
The occupancy of your properties drives your profits. Every property manager should know their occupancy and vacancy rates. While a 90% occupancy rate looks good, it can improve if the area average is 97%. Understanding what drives occupancy in your area can identify problem areas.
But having higher than average occupancy rates also indicates inefficiency in business. You may be charging lower rent or providing better facilities at lower costs. Though this looks attractive, it could affect your ROI.
Number of calls answered
Most real estate prospects communicate through calls. According to Leasehawk, leasing offices miss 49% of the total calls they receive. Tracking your calls can help you evaluate your communication strategies. If you miss out on too many leads, you can use software to automate your calls and emails. Property management software like Yardi and MRI have inbuilt tools to handle lead communication.
Outstanding debt
Outstanding debt owed to you is an excellent metric to analyze the company's cash flow. Having a high number of arrears indicates inefficiency in rent collection. You need to look into any situation where the rent is consistently late. You can manage rent payments through property management software. One way to reduce arrears is to provide digital payment options to tenants. They are quicker and more secure with financial data.
Lead conversion rates
Even if you have a high lead generation rate, the real metric you need to analyze is lead conversion. A low lead conversion rate means that you are not doing enough to move the lead through the sales funnel. Most sales are achieved after multiple follow-ups. But 44% of salespeople do not continue lead nurturing after a single follow-up attempt.
Improving your lead nurturing strategy can increase conversion rates. You can follow up through phone calls, emails, or even text messages. Make sure that your communication includes information that piques the lead’s interests.
Average days-to-lease
Rental properties can take some time to get occupied. The longer it stays vacant, the more rent you miss out on. You can compare your average days-to-lease by the area average to know if you are lagging. If your days-to-lease is below average, it could be due to several reasons. Are you advertising enough? Are you marketing on the right platform? Is your lead nurturing plan effective? These are some questions you can consider to decrease your apartment vacancy durations.
Tenant satisfaction
Measuring tenant satisfaction is a great way to know about your property management processes. You can understand your tenants' needs as well as get feedback. The best way to measure tenant satisfaction is through periodic surveys. Improving tenant satisfaction can have a positive long-term impact on the company’s revenue. It can also control the turnover rate and increase tenant retention.
Inventory of properties
As a property manager, your business keeps running on the inventory you have. Keeping track of the number of properties gained and lost can help increase inventory.
You can evaluate the effective strategies that led you to gain many properties. You can reduce client turnover by implementing similar plans. Similarly, you can identify mistakes that led you to lose properties. Rectifying your marketing strategy can go a long way in increasing your inventory.
Repair and maintenance costs
Most property managers do not keep track of repair costs, especially if they are minor ones. But these can add up over time to show as a significant expense. Evaluation of maintenance costs poses several questions.
Are most of these repairs actually required? Do you compare market prices to understand the cost of a repair, such as pipework changes? Often, you could be overspending on repairs without even realizing it. This can be revealed if you keep track of all your major and minor maintenance costs.
Property management fees
As a property manager, you may charge variable rates for different services. But if you have been losing clients or not getting many in the first place, it's time to look into what others are charging. Do you charge too much? Are you providing good services for your mentioned fees?
Conversely, you might be charging too little, especially if you are a beginner. This can get you many clients but limit your profits. Compare your fees with other property management services in your area. Also, compare your services to know if you have to increase or decrease your charges.
Rent-ready costs
Tenant turnovers are inevitable. When a tenant vacates a unit, you incur additional expenses to make the property rent-ready. Many property managers follow a standard procedure for making the apartments ready for renting again. This can involve repainting, renovations, and repairs.
Many of these expenses can be unnecessary. If a tenant has left the property in a good condition, you may not need to paint it again. Calculate the average costs to make each apartment rent-ready and identify expenses that can be avoided. Make sure that you do not compromise on the quality to decrease costs.
Revenue growth
Revenue growth sums up all other metrics to show you the overall performance of your company. Unlike most analytics, revenue growth is easier to understand. Many digital tools analyze revenue to provide easy-to-understand visual reports. A simple look at them can tell you about the well-performing areas. It can also show you what areas you can improve on.
If you find a change in revenue, you can utilize other metrics to determine the problem area. Similarly, you can use the metric to identify effective strategies to improve property management.
Use technology for better analysis
Most analytics depend on the evaluation of huge amounts of data. Property management software makes it easier to organize and analyze data to generate useful reports. The manual analysis takes a lot of time and can also be inaccurate. With digital tools, reports are more accurate and quick.
According to a McKinsey report, 85% of the participants have digitized their companies post-pandemic. If you automate your data analysis process, it puts you at an advantage over your competitors. Property management software also provides better data security. Investing in good software can not only help with analysis but also other real estate processes.
Automate your property management analytics with Assetsoft
Want to improve business performance through data analysis? We can help you!
At Assetsoft, we use the best software such as Yardi, MRI, and UiPath to provide complete property management solutions. We integrate the required tools according to your needs. Our services include software implementation, training, and technological selection. We utilize AI-based tools for data analysis.
You can get accurate reports and also customize your input through AI software. Apart from that, Assetsoft can automate all your real estate processes. Through RPA, voice integration, and IoT, we can simplify your whole property management strategy.
For more information, book a consultation with Assetsoft!