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Property Management


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How many properties can a single person manage?

with Sarah Bell

With a strong background in maths, Property Management guru Sarah Bell explains a mathematical approach to this question.

1. Establish strain

It all starts with Strain Theory. Sarah says, “A strain is where your operational capacity has been reached with the existing set of variables. In property management, it’s time to implement strains when everyone is in tears or people quit. Everyone is different.” Make a note.

2. Establish a number value for the operating human resources

Calculate the cost of labour. Calculating strain is when human resources are at their limit. Work out how many properties you're managing now if you're at strain. That's your magic number - that's your limit now. What varies is how many properties you can responsibly manage without getting to strain and being at strain now. You can add property managers or you can save capacity by introducing efficiencies.

 

3. Introduce efficiencies

Inspect real estate

Sarah says, “We use Inspect Real Estate to send out an automatic web book with information about the property, so it saved us lots and lots of conversations that didn't really need to occur in a digital world. It had a dramatic impact on our inquiry and also followup inquiry and people looking for applications That saved us about a 15% efficiency across the whole department.”

Switch to REST

Sarah says, “This gave us landlord portals and a whole bunch of new functionality that we didn't have under our previous trust accounting software. We thought it would give us a 10% efficiency”.

Property management play book

Sarah developed a comprehensive play book and it saved the company 10%. She explains, “It wasn't that we decided to shortcut or dramatically do our operations any differently, but we weren't having to really think about what needed to come next and we were communicating better because everyone was singing from the same hymn sheets”.

4. Quantify the human resources that will be in place in the future

Sarah says, “You use this if you are looking at putting an additional property manager or additional team member or changing the structure of your department. The value has to be constant to the values that we applied in the first step or it won't work. For example, if you're not going to have any greater input as a business owner in the property management department than you did have previously and we gave you 5% of the productivity, then you need to keep 5% in this next step. Where the first step had to add up to a hundred, because we're at capacity, we're building capacity now so the total will be over a hundred and then we get a multiplication factor”.

5. The final part of the formula

For Sarah’s office, the new capacity factor for human resources was 140. We have a multiplication factor of 1.4. Now we have to work out a quantitative, which is a number value for efficiencies that we're going to introduce. And there’s the answer!

 

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Sarah Bell