by David Sullivan
The multifamily industry has a turnover problem, but it’s not the resident turnover we primarily think of. The turnover problem is actually one that has been steadily growing for the last decade: property managers.
While many operators focus on resident turnover, losing a property manager can take a huge transitional toll on how a community functions. Property management turnover is costly and puts a strain on other onsite associates. Research from the National Apartment Association estimated 2019 turnover for onsite managers and leasing teams was 22.5% and 31.9% respectively.
So, why do property managers leave? While multiple reasons exist, delinquency management is one of the biggest factors – some of what we hear a lot is…
- “Managing delinquency sucks” – Delinquency is bad, and it generally means residents aren’t having a good experience. Paying rent late is stressful enough. Worse yet, property managers don’t sign up to collect bad debt. Who wants to approach an irate resident who is emotionally stressed because they are having trouble making ends meet — or a resident who just experienced an expensive, stressful life event — with a high-cost late fee?
- “Managing delinquent rent is time consuming” – Property managers don’t necessarily have the tools or time to understand the personal circumstances of each renter, and managing delinquent rent has become a huge part of the job that no one enjoys. The process of working with each renter is time consuming, taking at least a few hours a week per delinquent renter, at best. Property managers would prefer to spend their time sourcing great new renters and creating positive experiences for residents.
- “Approaching delinquent residents can be downright scary” – Property managers take on the burden of communicating with delinquent residents, which can create uncomfortable and tense interactions. When placing an eviction notice, some property managers are leery of someone angrily confronting them when they are embarrassed or defensive.
The industry can better support property managers when it comes to a task that drains both time and energy. A holistic approach to receivables management alleviates that debt collection responsibility, and proactive flexible rent solutions are key to this.
Flexible rent solutions can completely transform the collections process and elevate the rent payment and processing experience for both renters and property managers. According to internal data from Till, its Flexible Rent platform improves delinquent rent and cuts it by more than 50%.
A flexible rent program which personalizes a renters payment schedule can actually set renters up to succeed and prevent delinquencies. When rent payments become manageable for renters, property managers save up to 70% of their time spent on a historically challenging process. Better yet, Property Managers that offer flexibility can proactively solve delinquency issues and have a more positive relationship with their renters.
This also helps reduce the amount of friction that managers and renters face. Ask any resident if they want to hear from their property manager about rent – they’ll likely say “no.” The same goes for property managers who have to reach out to residents who have yet to pay. Introducing a third party to the collections process can help smooth those relationships and make them more productive. Not only that, but these third parties can create another layer of customer service and provide a vital extension to the property management team.
New financial amenities and flexible rent methodologies are evolving quickly and provide unique benefits for residents and property managers. It’s time for the industry to rethink the approach to enhancing the resident experience. Doing so will transform property managers’ happiness and reduce the chances of potentially debilitating turnover.
Categories: Property Management, Thought Leadership
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