The 4th of July conjures up BBQ’s, fireworks, picnics, family time and celebrations. Independence Day is a federal holiday but if we take a moment and consider the struggle to get to independence, I can’t help but see the correlation to the struggles of being a business owner. When I ask people why they want to start a property management business usually the response has to do with the goal of independence and freedom. So how do we get there?
- Freedom to Chart Your Own Course
Most people that come to property management come from past careers and experiences. I have met very few that say, “when I grow up, I want to be a property manager.” The freedom to control your future, your income, your creativity, your ability to see a problem and solve it is the entrepreneur’s path. Doing your own thing takes courage. Family and friends may not understand or support your desire to create something. They let fear get in the way but for those that feel it is something driving them at their core they must do it.
How do we chart our own course? As with anything, have a plan. Have savings to support your transition from side hustle to a full-time business. Get educated through licensing, courses, membership in trade groups such as NARPM and find mentors. Research the marketplace and get clear on who you serve, what you offer and price for profitability. Lastly, have a support system as a resource for the ups and downs of starting and growing a property management business.
- Freedom of Time
Freedom of time is at the top of the list for why most people want to start a property management business. It comes down to flexibility and control. With remote work options people are rethinking what it means to be a business owner. No longer are you tethered to an office. There is also a shift in generations with millennials putting a priority on time and experiences.
How do we create freedom of time? Create and stick to boundaries for your business, such as business hours, and put in place systems, along with processes and procedures to build your foundation. Use the latest in software and technology to streamline the business from accounting, to how properties are shown and leased up, to maintenance management. I think back to 2005 when I got into property management professionally and it would take a full week to do owner statements. It was tedious, costly, and a drain on time and resources. Fast forward and currently it takes a couple hours. The savings both in time and money are significant. Yet, I still get calls from desperate people who are completely overwhelmed and working 24/7. How do we get more time back into our day? Time block tasks, and delegate and automate repetitive tasks. Virtual assistants have become a necessary part of property management these days. They are cost effective, take the administrative load off the staff, and allow for growth and profitability which leads to freedom of time.
- Financial Freedom
The number one reason people give me for going into property management is for the financial freedom it offers. A property management business is an asset that can be sold or can provide a nice steady cashflow in retirement or as a legacy if kept in the family. You have real options with property management. Venture Capital in the property management sphere has elevated the asset and it is no longer looked at as the ugly redheaded stepchild to real estate sales.
How do we create financial freedom? You need a strong business foundation built upon policies and procedures along with systems for each department within the business. An understanding of how to read monthly financial reports and following best practices with accounting. Basically, keep expenses low, look for new ways to generate additional revenue, provide excellent customer service, and continually look to improve how you do business. Sometimes it isn’t about having 1000 doors if you are profitable and in your sweet spot with 100 doors. Financial freedom includes having an exit strategy and reinvestment plan for the proceeds of a sale. Financial freedom means you have a secure future financially.
In celebration of our Independence Month, I wish all of you the Independence and Freedom to chart your own course in life, the freedom of time to be with the people who matter most to you, and the financial freedom to be secure, generous, and happy long after you hang up the property management hat.