What does the new year bring for property managers?
By Yassir Awan, Director at SBA Property Management
2022 was a busy year for property managers. Faced with ongoing economic uncertainty and the national housing shortage, property managers are focusing on innovative ways to overcome a host of challenges and maintain customer satisfaction, growth, and profitability.
With the cost-of-living crisis ongoing, at the forefront of our minds is the challenge of maintaining affordability for clients and tenants, while managing rising business costs amidst pandemic-driven inflation.
In 2023, property managers will be looking for ways to adapt and streamline their services to overcome these barriers and provide solutions for tenants. So, what can we expect to see in the sector as we embrace the year ahead?
It comes as no surprise that economic uncertainty will continue this year as inflation continues to be volatile. Particularly in the rental market, affordability continues to be a major concern for consumers, property investors, owners, and managers alike.
The seller’s market is predicted to continue well into this year, meaning that high sales prices will drive rental owners to sell their properties for a bigger sum – which can prevent investors from acquiring new rentals at a good price. Alongside this, the cost of operating and maintaining rental properties continues to rise due to inflation, supply chain issues and labour shortages following the pandemic.
All this presents challenges for tenants, who are facing an overcrowded market with a low supply of lower priced properties and increases in rent prices – amidst other financial concerns such as the cost of energy, utilities, and consumer goods.
At SBA Property Management, we will continue to support our clients and tenants to bring down costs and support their budget management where possible in the next year. By reviewing our utilities contracts on a block-by-block basis, our leaseholders can expect full transparency and regular updates from us about costs, repairs, and maintenance, as we ensure all costs accurately reflect tenants’ individual situations.
As the knock-on effects of the pandemic ease, experts are predicting that house prices will decrease next year, with a transition to a buyer’s market predicted by mid-late 2023, therefore reducing the pressure on renters.
Amid ongoing economic uncertainty, it is important for property managers to stay up to date with industry regulations to ensure no unexpected costs are concurred.
On 1st April 2023, the next round of EPC Regulations will come into force, as part of the government’s push to achieve net zero emissions by 2030. This means that all rented commercial property will need to have an EPC rating of band ‘E’ or better – otherwise, landlords face potential fines of up to £150,000.
Green initiatives in housing have been acknowledged to make repairs more expensive. To manage these costs and new regulations, rental property management software and new digital technologies have become increasingly popular in the industry, as property managers are constantly re-evaluating their services to ensure optimisation.
Integrated into current systems, digital property management software can support the streamlining of an organisations services and processes through a range of tools.
‘PropTech’ – the application of digital technology to the property industry – has seen an increased uptake in recent years. The rise of Software as a Service (SaaS) sees applications delivered over the internet as a service, rather than via an installed software, and frees users from complex functions making the management process easier.
At SBA, we will be installing our very own management software this year, ‘MySBA’, to support our offering and maximise efficiency – both in terms of keeping costs down for the business, but also to improve our tenant experience.
Software such as MySBA will provide tenants with a quick and easy tool to enhance their living experience, allowing them access to support from their landlord or property manager within minutes.
Improved tenant experience is high up on the agenda for property managers this year, as more of the Gen Z population enter the rental market with expectations for fast communication and efficient problem-solving services in an age of internet driven use.
Growth and profitability
Despite economic uncertainty, there is optimism in the industry as we embrace 2023. Property managers are looking to grow their portfolios, and there are more companies entering the market due to high rent growth and rental demand.
With mainstream house prices set to fall by -10% next year and a marked improvement in mortgage affordability in 2023, the market looks promising for property managers wanting to grow their portfolios.
It is crucial for property managers to continue to provide high quality service to tenants, as we all navigate the unstable economic climate.