Despite the recent effects of the Covid-19 pandemic, there is still much opportunity in the market for letting agents to grow their portfolios.
September statistics from the Financial Conduct Authority show that the value of outstanding mortgage loans was 3.2% higher than a year earlier and there are a number of changes in the market which may be attracting new landlords.
The government’s stamp duty holiday on properties of £500,000 or less until March 31 2021 has provided a reason for landlords to increase their property count. Additionally, the period has caused many owner-occupiers to leave London and major cities and choose to let out their homes rather than selling them on, offering plenty of new prospects.
Finally, other agencies have been struggling during the lockdown, which may provide a chance to get ahead.
To grow your management portfolio, you’ll need to stand out in a crowded market. Think about what the unique selling proposition of your business is and tell your audience about it.
There may be many businesses out there which provide the same services as you, but if they do not tell the prospective landlords about it, then you will have the advantage.
Consider what makes you different: do you use technology solutions to improve your service? This can be a selling point in itself, especially if landlords have heard of the brand you use and trust it.
One client told us recently that they received 13 enquiries about their fully managed service from let-only landlords when they emailed their database to tell them they used Fixflo to manage their reactive repairs and proactive maintenance tasks, so it pays to communicate about what you’re doing and how you do it.
Using technology intelligently
There are plenty of out-of-the-box technical solutions available which enable the efficient management or even automation of key business processes including repairs and maintenance management, landlord prospecting and more.
Using technology to automate repetitive, manual tasks can free you up to scale your business; our 2019 Lettings Report found that 84% of agencies where each property manager manages over 300 properties provide staff with technology as part of their management processes, and the majority of these high-performing agencies integrate their CRMs with specialist software to create a custom software stack.
Choosing which technologies to use will depend on the nature of your business and where your deficiencies may lie. Some specialist websites list the major PropTech suppliers and aggregate reviews by their customers to help you choose the right partner.
Technology can also be used to greatly enhance your prospecting efforts. Tools such as Spectre can be used to mine public data about properties available to let in your area and in some cases identify their landlords. This will help your team to establish those with the highest lifetime value, allowing them to focus their business development efforts on high-yield activities. Each business must evaluate their data handling approach and make sure they are compliant with current data privacy regulations.
Another common challenge is the impact of legislation. Tech can help here, too. The Tenant Fees Act had a significant impact on the revenues of agencies, while general rules of compliance can feel difficult to keep up with.
PropTech solutions can help you record and keep track of what’s required, ensuring contractors have the right certifications and that your records are in order with an auditable paper trail. Confirming these important areas are addressed will free you up to pursue more revenue streams.
Building and scaling a team
You’ll also need a great team to bring in business. Your team should be able to work independently of your guidance, share a common goal and feel motivated and confident to work together.
Smart use of technology means you may not necessarily need a large team to take on a greater number of properties. Introducing new systems can help take the workload off your team, especially if their numbers are reduced due to sickness or furlough, and the greater efficiencies which they bring can mean there’s no need for new hires as work can be accomplished more quickly with the staff you currently have.
Simple restructuring can also bring greater efficiencies with your current employees. Identify with your team which tasks are simple, repetitive and easy for someone else to pick up, and then delegate from there.
These could be chasing invoices, gaining access from tenants or arranging certificates - anything with a low difficulty value but which still takes up valuable time.
Our Lettings Report also demonstrated the need to communicate good service quality, accountability and value for money by using hard numbers.
We found that 35% of landlords gave ‘costs’ as the number one objection they had to using agents, so agencies must communicate effectively the value they provide and show clearly what the customer is getting for their money.
Attracting new landlords is one important focus, but not if it comes at the expense of retaining current customers. It’s important to not give your current clients a reason to want to leave you.
Think of the areas that landlords feel are most important and consider how you’re meeting their expectations. These include finding quality tenants, ensuring properties do not remain empty for long periods of time and being transparent about costs.
These are easy steps you can take to maintain your current portfolio but you should also consider upselling opportunities. Are there new services you can provide beyond rent collection? If you’re already doing a good job with the services you currently offer, it may not take much to convince a customer to allow you to further be involved in their properties and increase their lifetime value. Again, technology could really help you in the provision of these services.
In a highly digital world, it’s easier than ever to grow your business - it’s just a matter of using the right tools.
The web and social media have provided highly effective ways to engage with and reach customers directly in their living rooms, while specialist technology solutions can make your business more efficient, ensure continual customer satisfaction, attract more landlords and increase revenue opportunities.
For more information on growing your letting agency portfolio, take a look at this free webinar.
*Simon Bushell is Sales Director at Fixflo, the market-leading repairs and maintenance management software.