Imagine an office filled with three-ring binders, stacks of carbon-paper receipt copies, post-dated checks waiting to be cashed and the day’s schedule hand-scrawled on a whiteboard. You might be picturing a scene from a movie depicting life before the internet — but this is the daily reality, still, in thousands of property management offices across the country.
While digital technologies have transformed nearly everything we do from buying groceries to finding a ride across town, the field of property management has not “gone digital” at the same rate. I can’t think of many other sectors where consumers still regularly pay by physical check or where voicemail is the primary way of keeping in touch. But as renters make up an increasingly influential part of the American housing market — and a tech-savvy one at that — the industry tech forgot may finally be ready for a complete digital overhaul.
Updating Property Management For The Digital Age
The oldest industries are sometimes the most difficult to change — and real estate has been around, well, forever. Heavily regulated and touching on everything from law to banking, the process of leasing a home hasn’t lent itself to easy digitization.
Meanwhile, property managers, often small-to-midsize businesses (SMBs) or sole proprietors, have traditionally made up their processes on the fly, scheduling maintenance shifts on whiteboards and keeping track of leases on paper. I’ve talked to hundreds of property managers, and they acknowledge that while their systems aren’t always pretty, they work. It’s not that they haven’t wanted to try new technology. But time is always limited, new systems can be daunting to learn and their priority has traditionally been finding new clients to serve. So new tools for residents and owners took a backseat.
But the reality is that technology has dramatically changed consumer expectations. Self-management and real-time access to information, feedback and service has become the norm for banking, travel, retail, ride-hailing and more. Smartphone access to key services is no longer considered a convenience but a necessity. For most of us, going back to a world without Google Maps, Uber or Airbnb is hard to imagine.
Property management — and really, the whole of real estate tech — hasn’t been able to innovate as quickly as other industries. And these changes have begun to create a gulf between residents and their managers. Having to hound your landlord about that leaky sink is no longer just inconvenient; it’s become a reason to consider moving. Indeed, our 2018 Renter Report, which surveyed 1,200 renters nationwide, shows that as renting becomes a popular option for Americans across the economic and demographic spectrum, expectations for service and responsiveness have shifted dramatically. Eighty-seven percent of millennial respondents prefer to manage their leasing process online, and two-thirds of residents across all demographics prefer to manage communications online.
The Proptech Residents And Property Managers Actually Want
But progress is finally being made in this space. The property tech industry now represents one of the fastest growing tech sectors, attracting more than $12 billion in venture capital in 2017 alone. Homebuying apps like Redfin and Homesnap are now practically household names. Meanwhile, an initial wave of rent tech startups has succeeded in bringing virtual apartment tours to the mainstream and simplifying apartment searches.
The latest generation of proptech is poised to streamline how residents, owners and property managers interact and manage tasks such as viewings, background checks, signing leases, paying rent and submitting maintenance requests. In the end, automating many of these mundane and time-consuming tasks should help property managers focus on a key and often overlooked amenity: creating a sense of community that makes rental properties feel like home. Rather than manually running credit checks or sourcing handymen for dishwashers on the fritz, managers can put more time into creating vibrant, living properties, growing their business and serving residents.
I’ve spent my career — 25 years and counting — working at the intersection of small businesses and technology. During that time, I saw the power that technology offers SMBs that take full advantage and give it the priority it demands. What excites me today about the property management space is that this same untapped potential to leverage technology to make the lives of frontline managers easier and improve their bottom lines exists throughout this industry. That’s a big reason why I made the shift two years ago to this proptech sector. Property management software can help companies be more efficient and profitable, while also making it easier to communicate and build connections with residents.
Admittedly, we’re not there yet across the board. I still walk into many property management offices where fax machines are regularly used and the ways of doing business are the same as they’ve been for years. To be clear, many of these managers are doing an exceptional job serving their residents with the tools they have. Every SMB owner is crunched for time and money — investing in a new software platform just isn’t everyone’s top priority. But the reality is that, soon enough, the reliance on the tried-and-true processes will start to hold property management firms back from meeting the expectations of their residents and clients.
Gone will be the days where technology adoption is optional, as resident expectations will demand the shift toward greater reliance on technology and online tools. At the same time, the benefit to property management firms is tangible: technology will enable property managers to do more with less and automate the rote and repetitive parts of their job. At the end of the day, technology can free up more time for managers to do what they do best — provide exceptional service to residents and owners and grow their business.