What’s behind rising demand for property management services? [The Lookout]

The Lookout is a content series that takes a deep dive into trends happening within small and mid-sized property management companies. Over the next three posts, we’ll look into a subject that our research has investigated repeatedly over the last few years: rising demand for property management services from small rental investors and mom-and-pop landlords.

The pandemic not only changed how property management companies operate—it fundamentally transformed the demand for property managers’ services. In this post, we’ll explain what’s behind this trend.

How Many Rental Owners Work with a Property Manager?

In 2019, just 55% of the small rental owners we surveyed worked with a property manager. In 2020, that number jumped up to 64%, and it has held steady at 63% ever since. That’s great news for property managers, though it does mean they’re busier than ever.

What’s going on here? When COVID-19 hit the rental market in 2020, there was a sudden need for expert advice on how to move forward with basic rental processes—and property managers answered the call, keeping owners’ properties and residents’ homes up and running in the face of incredible uncertainty.

But even as the rental market recovered from the crisis, we never saw a downturn in demand for property managers’ services.

Why do we think that is? Even now, so many aspects of rental property ownership remain more complex and more expensive than they used to be, and they involve greater legal risk. Despite the temptation to keep costs low by managing their properties themselves, rental owners continue to see the value in professional property management.

This is especially true for Accidental Landlords, who are least likely to have the expertise or desire to run their rentals on their own.

Which Property Management Services Are Most In-Demand?

There are eight main services that they expect their property management company to provide.

If you’re not offering all eight of these services, you could be losing business to competitors that do. Consider partnering with vendors in your area to bring some of these more specialized services to your clients.

In our next post, we cover how property managers can help rental owners’ properties achieve profitability—helping to further cement the value their services provide. 

You can learn about this topic and so many more in our 2023 Property Management Industry Report. And be sure to follow The Lookout on YouTube for weekly updates on our latest research on the rental market and property management industry.