If you want to expand your property management portfolio, there is so much you can do. Unfortunately, most managers don’t know where to start. Besides, adding properties to the areas you already cover is one thing, but making profits from it is another. If you don’t have a growth strategy, you might fail terribly. Here are actionable steps to consider.
1. Create An Expansion Strategy
You can expand in many ways, such as bringing new owners into the location you wish to explore. The option is ideal for managers who want to control their growth because they can add properties gradually. Another strategy is to find property management companies that want to sell. Before acquiring assets, ensure that the company is in good standing and makes decent profits. You can also set up a franchise to consolidate other managers to control properties under your brand.
2. Research Your Target Locations
Start by looking up opportunities in your target areas. Choose places with solid markets. For instance, single-family home rentals have been growing exponentially in suburban areas. Remember that new regions will require a new marketing strategy because of the different demographics, cultures, and rules. If your target properties are located outside your locality, make sure you understand the new place’s state regulations, taxes, and zoning rules.
3. Understand Your Expansion Needs
There is no better time to determine your company’s management process than now. Consider the gaps you need to fill and the procedures you should replicate. Consider the places where your company should grow to sustain the needs of new clients. For instance, what infrastructure do you need to take up properties in new regions? Will you require more phones or different software?
4. Develop A Budget
You spend money to make money, and that applies to real estate properties too. Adding properties to your portfolio will bring in more profits, but that will take some time. Consider your operating margins and how they will increase when you increase properties. The aim is to reduce operating costs and increase profits.
5. Know When To Quit
You should have a pre-defined stopping point. For instance, there should be a target number of profits or rental properties that define your success. If you don’t have this benchmark, you might run at a loss. Managing homes in many locations can be difficult, but having a solid plan will ease the process.