Big Data and Property Management

Big data is the latest buzzword for most businesses around the world, and it has a major role to play in property management. With the burst of information and data, available today, big data is an apt phrase, and is mainly used for benchmarking, risk analysis, predictive analysis, and business intelligence. Here are certain important points to consider when you think of using big data for property management.

 

Lay Down Benchmarks

 

It is pivotal to know where you are starting from, to figure out where you intend to reach. Hence, the first thing property management can do with big data is lay down benchmarks for making improvements and raising efficiencies. For instance, utilities can be managed in a much better way, whether is it for going green or being sustainable. With benchmarks, residents and property management can understand the meaning behind the numbers, so that decisions can be taken more intelligently for creating efficiencies and cutting costs.

 

Simplifying Business Analytics

 

Overanalyzing data is not going to produce better results, and in fact, it can sometimes be counterproductive. Once the data has been collected, reach for the goals that are easily achievable first. For instance, trying to figure out Energy Star rating for units might be difficult, but the data can provide many indicators where energy efficiency is possible.

 

Information is Important

 

Even though big data has become a buzzword recently, the importance of information has never been undermined or not deemed essential. Collecting information and data has always been a priority for analytics and business intelligence. Hence, it is all about collecting the right information and data, to make the right decisions.

 

The Importance of Clean Data

 

The phrase, "Garbage in, garbage out" is popular amongst programmers, and it is equally relevant to data. Property management will have many entry points for data including the vendors, staff, home office, and so on, which makes clean data entry a challenging task.

 

For instance, property management might need a professional service to clean up utility data. However, steps should be taken to develop a culture for entering clean data. People who enter data should be made aware about the expected quality of data. For example, rather than allowing the staff full freedom to enter marketing sources, a drop-down list of notable sources would make the entries cleaner. When data is clean, the analytics are much sharper for providing predictions that are more accurate. 

 

Intelligence and Right Action

 

When you are studying a report, you usually want to see another report to take a better decision. This can however, go on and you might not know the full picture ever. Therefore, developing intelligence systems is a priority in businesses, as when this system is functioning optimally, it will compel right action.

 

 

In property management, business intelligence will have a big role to play in centralized reporting predictive analysis, risk mitigation, and revenue management. The latest property management software are now not merely data collecting tools but also have robust reporting features that can prompt the right actions. 

Key Performance Indicators for Energy Management

Energy management is a key area where property management has the opportunity save costs and increase profit margins. In most properties, invoices for electricity, water, fuel oil, gas, storm drainage, sewer, and refuse costs are major items and have to be managed effectively.

 

However, for measuring and reducing these costs, property management should know about KPIs (Key Performance Indicators). In order to use KPIs effectively, there should be a process to obtain high-level view and manage energy data. Property management should be able to measure, benchmark, compare, and analyze KPIs.

 

On most properties, managers usually struggle with excel spreadsheets, whereas some take the help of invoice processing software or vendors. Some even employ experts to customize the system according to the requirements of the property. Ultimately, a system has to be in place that is highly capable of measurement and verification.

 

Property management can then define factors, which are critical to the management of energy spending. For such a process to work, it is critical to compare KPIs, since each property and its management is different, and the importance of KPIs may vary. However, the following KPIs should be always considered for forming a strategy for energy management.

 

Costs of Energy

 

Cost is one of the KPIs that will always top the list on any property. Some prefer to compare cost between sites, while some like to categorize items and compare between them. However, energy management and savings is much easier when you line up energy spends by cost. The best place to find where most money can be saved is the place where it is being spent the most.

 

Then strategies can be developed to reduce the percentage of spend gradually. However, other important areas should not be ignored, such as discrepancies in invoices and possible leaks. Nevertheless, cost should be your benchmark and must be give top priority.

 

Energy Rates

 

Property management can have direct control in certain situations by exercising the best energy rates. Current rates will have to be reviewed and potential rates will have to be investigated. Wherever this is possible, savings can be made even before implementing strategies for reducing cost through usage.

 

Therefore, property management should have very acute knowledge about the current rates, which will make comparisons possible. For instance, when comparing three properties in the same area, if even one is paying a different rate, then something could be wrong. After investigation, property management might have to make changes to lower cost of one or two of the sites.

 

Rates can be controlled through energy procurement. Most states are now allowing deregulation of gas or electricity. It is possible to get an outcome where the rate structure could be lower, and the benefits can be procured over a long term basis. It is best to open the door towards a service provider that understands the multifamily industry and has experience in providing services to this segment.

 

Usage Measurement

 

This is the key area where strategies can be formed for reducing costs. It is quite simple since usage equals cost. Therefore measuring, managing, and reducing usage will ultimately reduce costs.

 

 

Marvelous Maintenance Management

Repair and maintenance are often considered major issues in property management, especially on apartment properties. Whether the unit is new or old, there will be pipes leaking, HVAC units failing, and water heaters malfunctioning. Maintenance and repair is a major expense, which often eats away the profit margin and ROI. Even though these tasks are inevitable, effective management can help in reducing costs. Apart from acquiring better deals on replacement items there is much more to effective maintenance management.

 

A Highly Skilled Job

 

Many property managers feel maintenance is a messy business and most do not have the skill set to handle these tasks. In maintenance, one needs to be able to run projects smoothly, manage deadlines, have a keen eye for detail, and manage vendors or maintenance teams. Especially, vendors should be effectively managed to make sure the tasks are being accomplished at reasonable rates.

 

An Organizational Mindset

 

Poor record keeping, overpaying for materials, and having the wrong team for the job, are often the main reasons for failure. Ideally, superlative maintenance management would mean having effective leadership, establishing efficient reporting procedures, having clear descriptions of jobs, and most importantly having a balanced mix of primary and secondary vendors who are able to deliver.

 

Property management should aim to develop an effective maintenance management program that incorporates streamlined processes for leveraging available opportunities and plan execution. Streamlining can be done by firstly identifying who can do what, how it can be done, and how it can be executed. This would include choosing the appropriate vendors, forming the right agreements with them, and implementing standardized costing. These three things are the foundations of your maintenance management strategy and hence should be carefully planned and executed.

 

Ignore Technology at Your Own Peril

 

Lastly, property management should seriously consider choosing effective maintenance management software that will serve as a tool. However, the difference between tool usage and process execution should be clear. If the process is not executed properly, the technological advantage of using software will be defeated, and in fact, the software could create more issues and increased workloads. For instance, such a situation could be compared to using a wrench for hammering a nail, instead of a hammer.

 

A lot has changed in the past few years including the expectations of tenants and the rules and regulations of the state and city that have to be complied. Having the best maintenance management software could make a major difference in not just the management of larger projects but also in the execution of day-to-day things such as turnovers and service requests. The software will enable property management to track projects in accordance with a set time, which will provide property managers with the required control for overseeing each task to the very last detail.

 

Survival is at Stake

 

Summing up, managing maintenance projects effectively is all about managing processes, people, and technology. Mishandling any one of these three aspects can seriously upset management of the project, and could result in increased costs, poor turnaround time, dissatisfied tenants, and can ultimately detrimentally impact the property’s bottom line.  

 

 

How to Improve Forecasting in Property Management

Property management will have to prepare their budgets for the coming year, and the performance in the next year will be acutely influenced by how well this budget forecast was prepared. The performance of the budget will depend on many factors including management practices, behavior of the market, and prevailing economic conditions.

 

Forecasting is a special skill that can help property management see how the property is going to perform strategically and financially in the near future. Expense and revenue forecasting also helps to gain insight into possible pitfalls or opportunities that may lie ahead. However, most property managers do not like to open the window to forecasting, and it is usually seen as a required task rather than a useful tool.

 

Secondly, forecasting can be a major chore if it is not aided by software and automation. Usually, forecasts for apartment properties are done by utilizing spreadsheets, which require quite a bit of preparation and there could be many errors in the formulas used. Here are important points to consider that can make the process of forecasting much easier.

 

Obtain the Right Numbers

 

Right in the beginning, the correct data will be required for identifying trends and for determining a baseline. If the numbers do not represent realistic projections then the forecast is not likely to work.

 

Easy and Seamless Access to Data

 

Data being the crucial factor in forecasting, it should be easy to access. This will speed up the forecasting process dramatically. Data should be seamlessly available, so that it can be easily captured and imported into the preferred forecasting tool. A magnificent tool will enable storage and quick modification of the data. On the other hand, manual copying tasks and flipping between printed spreadsheets will slow down the process considerably.

 

Tracking Performance

 

To forecast with stunning accuracy it is pivotal to track previous performance levels. The system used by property management should have in-built features for generating reports on different aspects of the property. For instance, in order to project energy costs, you will require a detailed overview of utility invoices, which can be analyzed easily.

 

Collaborating and Sharing Data Online

 

Collaborating with professional vendors and business groups can greatly improve forecasting accuracy. In this regard, a striking web-based tool would be very useful that enables quick data sharing. Otherwise, property management will have to handle and send spreadsheets manually, which is cumbersome and slow.

 

Keep Provisions for Seasonal Changes

 

Seasonal changes have a resounding influence on revenue and expenses. For instance, consumption of water will be more in summer season, which is going to hike up the water bill. Hence, instead of a yearly average cost, it is better to incorporate seasonal trends, which can improve cost forecasting and the budget for those particular months.

 

Accuracy of your forecasts will play a major role in not only in long-term predictions of performance but also in short-term decision making of operations. Forecasting is a strategic process that can help property managers discover profitable avenues and potential areas of savings, by analyzing past performances and expense trends.

 

 

Accessibility Compliance in Property Management

All properties must comply with the Americans with Disabilities Act (ADA) 1990 and the Fair Housing Amendments Act of 1988. Non-compliance could result in huge damage settlements and costly lawsuits. Property management can prevent exposure to such risks provided they simply understand the laws and rules about accessibility compliance.

 

One of the major misconceptions is that apartment units are automatically accessibility compliant when they are newly built. However, this is not usually so because ADA approval may not have been given by a federal or state agency such as HUD (Department of Housing and Urban Development). There is no check carried out by HUD or state agencies to see if the newly constructed units are accessible.

 

Running into Problems

 

This means if the architect has not designed the property according to accessibility laws then the property could get into trouble when there is a tax credit inspection by a state agency, and it could be much worse when a mobility-impaired tenant files a lawsuit. In the past few years, there have been number of accessibility violations, and apartment properties had to pay huge settlement for damages and many were in seven figures.

 

There are fantastic chances that many properties are non-compliant with accessibility rules, even if the builder has completed the transition and self-evaluations plans required in 1989 by HUD. Most of the compliance issues, which were reviewed about 25 years back, may not be relevant, as the property could have changed for a variety of reasons. Even though the rules of the Fair Housing Act do not change often, the level of required compliance of the property might change. For instance, a thermostat being replaced in an apartment unit might be placed too high.

 

Suitable Outside Help

 

To determine potential risks of non-compliance, it would be a stellar idea to have the property professionally assessed for accessibility compliance. Look at the charges as an investment in risk management, since it can save the property millions of dollars in lawsuits. It is strategic to have the assessment done by a professional team, since it can be a daunting task. One has to be knowledgeable about the many local, state, and federal rules, and know which of them apply to the age of the property.

 

Areas of Focus

 

Most accessibility non-compliance problems arise when the property is older, the thresholds are high, the accessible parking spaces are not enough, and thermostats and switches are not easily accessible. Other issues include narrow doors and not enough floor area for accommodating wheelchairs, and blocked sidewalks due to parked cars.

 

Do not Fix what is not Broken

 

 

Therefore, it is best for property management to detect accessibility issues early and have them sorted out immediately. Secondly, even if the property has been checked and has been certified earlier, it is prudent to do an inspection now to make sure it still complies with accessibility rules. Whenever, there are renovations and repairs, make sure to keep accessibility rules in mind and do not alter the original placements of switches and thermostats, especially when the property has be inspected previously and it has passed all the requirements. 

Managing Energy for all Properties

According to studies, around ten billion can be saved a year through effective management in the multifamily industry. For property management, when utility or energy is usually the second largest line item, it is surprising that many companies do not actively participate in a program of energy management. Most property managers do not know where to start, or developing a program that will yield the best energy to cost ratio. Here is a striking plan outline that can help develop a concrete energy management plan.

 

Contacting an Energy Expert and Improving Relationships with Utilities

 

If property management has already initiated some system for managing utility then they would already be in contact with an energy expert. This professional can provide some very useful advice and suggestions for improving the existing system. Local utilities also now have different types of discounts and incentive programs that are worth investigating. Many people are not aware of these programs and they could be particularly useful in the multifamily industry.

 

Gathering and Tracking Billing Data for Utilities

 

Managing cost is not possible when you do not know how much energy is being used and what you are being charged. Hence, the first step would be to gather and track invoice data of utilities. This will provide a fantastic and specific idea about energy consumption on the property, the rates being charged, and property management has the opportunity to check the accuracy of billed amount. If these processes are not possible in house, then the job could be outsourced to invoice processing companies, who can handle it more professionally.

 

Using Utility Management System

 

Simply collecting and storing data will not be of much use, unless it is analyzed for better revenue outcomes. Property management could generate a spreadsheet from the collected data and have it analyzed. However, a superior way would be to use a SaaS (Software as a Service) based system, as it would provide better visibility, control, and tools that can help in reducing costs. If there were no expert available to professionally run such a system then it would be best to leave it in the capable hands of an energy expert or an invoice-processing vendor.

 

Reviewing Data Regularly

 

Energy management process involves analyzing data from different angles and finding potential areas of saving. Property management should consider employing a person who has energy management or analytic certification. Reviewing the data professionally, at least once a week is vital in energy management. If a full-time person is not available, a professional from the utility service or invoice processing service could be called to inspect the data at regular intervals.

 

Ranking Costs

 

Some of the important utility metrics that are important to rank would be electricity, water usage, and sewer costs. However, other areas that are paramount for your property should be included as well. Whether it is common areas, apartment units or some other aspect on your portfolio, the high cost areas will yield the best opportunities for saving capital.  

 

 

The Worst Mistakes Property Management can Make

Property management is a challenging profession and the property manager has a tough job of satisfying the tenants as well as the property owner. A minor mistake or small amount of carelessness could cost the business dearly, and hence property managers have to be vigilant and focused. However, there are many instances of property management committing major and sometimes irreversible blunders, which are listed here.

 

Poor Process for Screening Tenants

 

Tenant screening should be given top priority and there should not be any room for carelessness or mistakes. In fact, before the application process, only those prospects should be allowed to apply that meet certain criteria. During the application process, property managers should follow strict protocol in screening procedures and carry out a credit and criminal background check, and reference the properties where the tenant had stayed before.

 

Not Taking Preventive or Intervening Actions for Rent Arrears

 

First, there should be specific terms and conditions in the lease that cover late payment of rent. The tenant should feel that property manager has some strict policy regarding rent collection, and there are penalties for not paying the rent on time.

 

Secondly, property management should make sure that all the things are actually put into practice; otherwise, tenants will obtain the feeling property management is not really serious about implementing the lease clauses. Even in cases where the tenant is going through actual financial difficulties, it would not be wise to be tolerant beyond a point, since it will be very difficult for the tenant to catch up on the arrears later.

 

Avoiding Routine Inspections

 

Inspections should be carried out periodically, since that will reveal structural problems, safety hazards, and other issues on the property. In case of internal inspection of units, tenants should be given sufficient notice about the inspection according to legal guidelines. Even on smaller properties, a routine inspection is an essential task that property management cannot afford to ignore.

 

Avoiding Communication

 

Many property managers prefer to remain distant and hard to approach in order to avoid receiving maintenance requests and complaints. Maintaining concrete relationships with tenants is key to tenant retention and reducing vacancies. It is much worse when the property manager ignores phone calls or avoids replying emails from tenants. In fact, when communication lines are kept open, many issues on the property can be resolved quickly and relatively cheaply. Maintaining proper communications will not only improve relations with tenants but also improve the reputation of the property.

 

Not Keeping Track of Renewals

 

Ignoring renewals is the quickest way of reducing a stable income. Lease renewals should be given top priority and the property manager should make sure the tenant is given stellar reasons to stay on.

 

Mishandle Security Deposits

 

Many property owners and property managers are known to mismanage security deposit amounts of tenants. They are not returned to the tenant on time when they leave the property, and many tenants have to give several reminders and threaten legal action to get their money back. Security deposits should be accounted for in a separate account and all the legalities have to be followed regarding these amounts. Any property manager or property management firm who messes this up will lose business because word travels fast in this regard.

 

 

 

 

Best Free Apps for Property Management

A property manager has a busy schedule and usually has to multitask to keep up with the increasing workload. With the dramatic increase in development of mobile technology, property management now has several tools at its disposal to make their job easier. Here is a list of the best free apps that a property manager might find very useful.

 

iAuditor

 

This app is developed by Safety Culture, and it enables property managers to conduct safety inspections much quicker and in an easy manner. iAuditor is considered the most popular app for inspection checklist around the world, since it can be used for conducting more than 25,000 inspections in over 80 countries.

 

The app provides more than 20,000 inspection forms in its Public Library, and you can build your own form within seconds. The numerous forms available in the library is the result of users from around the world collaborating and sharing various safety inspection checklists. iAuthor is being used for working efficiently and smarter, by international airlines, fire departments, government agencies, and single trades people.

 

iAuthor is not merely a checklist as smart fields enable users to develop actions for responses, and create better intelligence into the templates. The main features of this app includes:

 

o   Dynamic and smart fields

o   Template creator

o   Weighting

o   Scoring

o   Export to various report types in one go

o   Nesting and branching of sub-categories

o   Tick boxes

o   Options for mark-up or image annotation

o   Templates can be pin locked

o   Enables setting of default email for various audits

o   Option for exporting in PDF and CSV

o   Sections can be stamped with date and time

 

OfficeTime

 

This free app is excellent for tracking time and it is quite intuitive as well. OfficeTime will enable the property manager to easily track the time spend on different tasks, and to optimize efficiency. It can also enable the person track their particular project, its life, the time spent, and the expenses. The various features of the app are ideal for small teams and freelancers. Here are its main features:

 

ü  Enables multitasking, as multiple timers can be run at the same time

ü  Tasks can be switched quickly

ü  Tracking is possible by category and project

ü  The app can work offline, which means there is no need for 3G of WiFi connectivity

 

The full version provides these additional features:

 

§  Unlimited categories and projects can be tracked

§  Custom date reports

§  Export to Numbers or Excel

§  Can be synced to PC or Mac

§  Generate cross team reports from your computer

 

HelloSign

 

HelloSign enables you to sing documents on the go, without having to download or scan, print, and sign the document. Property manager can simply take a picture of a PDF document or import it from Google Drive or email. He can then sign with his finger on the screen, and then send the signed document through email. The app also offers features for editing the PDF document with checkmarks, and text, apart from the signature component. 

 

 

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